Outsourcing vs Co-Development: Why It’s Not an Either-Or

About Francesco: With over 10 years of project management experience, Francesco leads project operations and oversees IT infrastructure implementation at Forge Studios.   

As Deconstructor of Fun recently pointed out: the most successful studios today aren’t scaling by hiring but through co-development. With the rising pressure to build bigger and better titles (and faster too), many studios are turning to trusted external partners to meet the challenge.  

But as the interest in this path grows, the following questions are often raised:  

• What’s the difference between co-development and outsourcing?  

• Are they interchangeable?  

• Is one better than another?   

At Forge Studios, we’ve worked as both an outsourcing partner and a co-development partner across dozens of IPs. Here’s what we’ve learned about when each model works best and what separates a service provider from a true collaborator.  

#1 Co-development and outsourcing are equally valuable but serve different purposes 

It’s not an either-or situation. In fact, it’s common for an external development studio to be a co-development partner for one client while simultaneously handling straightforward outsourcing tasks for another. Projects differ widely, as do the needs of studio teams and company policies. 

That said, it’s natural for a studio with ambitious, long-term and multi-departmental growth goals to lean toward co-development. Outsourcing remains a valid and viable path, but growth within that model tends to inevitably be limited.  

#2 Co-development offers deeper collaboration and strategic involvement  

The clearest difference between co-development and outsourcing is communication style. The more integrated the external team is and the more access they have to your project, the more it resembles a true co-development partnership.  

Outsourcing working relationships are more limited to executing and delivering isolated tasks with minimal strategic input. In contrast, bringing a partner into your project early allows you to align on art and visual direction, co-define production pipelines, and solve problems together.  As a result, it becomes an additional support system and a true extension of your team.  

#3 Co-development readiness is dependent on mindset, not just capability  

Your studio is ready for co-development when you overcome the taboo of external delegation. It’s not just a matter of getting approval from top management. It also requires buy-in across the studio. It is important to have team members who can manage external relationships because a promising opportunity can still fall apart if your internal structure doesn’t support effective collaboration.  

On the other side, an external development partner is ready for co-development when they are technically capable in addition to being able to manage workflows collaboratively and communicate clearly across teams. 

Here are a few key questions worth asking. If you can confidently say yes, co-development may be the right fit:  

• Are we ready to trust an external partner with responsibilities and ownership to a part of our game and not just tasks?  

• Do we want a collaborator who can contribute to the process, not just executing parts of it? 

• Do we have the internal structure to support a true partnership? One that involves shared planning, open communication, and collaborative problem solving?  

#4 The partnership and feedback are different  

In traditional outsourcing, feedback typically centers on asset quality and delivery timelines. In co-development, the feedback becomes more collaborative as if it’s among peers working side by side,  and not constantly evaluating them.  

While a co-development partner is still technically external, the partnership feels more internal. You plan together, solve problems together, and move forward as one team.  

All this to say, both models coexist in today’s market. Some external development partners thrive as high-quality asset providers, while others evolve into strategic co-development partners.  

The right choice depends on your goals, timeline, and willingness to build trust and grow. Either way, know what kind of partnership you need and choose a partner who can meet you there.  

For more information about Forge Studios and the services we offer, send us an e-mail at business@forgestudios.com.

In the meantime, check out our latest work on Art Station here.