LaSoft has been in the custom software development market for over 10 years. Since 2020, due to the COVID challenge, LaSoft’s team has taken a curve towards changing business strategy, strengthening its portfolio, and expanding the partner ecosystem. Economic fluctuations, the war in Ukraine, the global geopolitical crisis, and new technologies led to dramatic changes when our team started to focus on integrating innovative technologies and expertise in demand to meet the urgent needs of potential clients who see hybrid cloud, ML, AI, IoT, etc. and digital transformation efforts as crucial sources of competitive advantage.
NOTE!
The software market is set for remarkable global growth. By 2024, revenue in this sector is projected to reach an impressive $702.00 billion. Enterprise Software is expected to lead among its segments, with an estimated market value of $294.30 billion by 2024.
Additionally, the software market revenue is projected to grow at a steady annual rate of 5.01% from 2024 to 2029, increasing the market size to $896.20 billion by 2029. Notably, the United States is expected to generate the highest revenue in the global software market, with a forecasted revenue of $363.40 billion in 2024 alone.
Key Takeaways
- Technological advancements and geopolitical events, including wars and economic fluctuations, have reshaped the custom software development market and business processes.
- AI and ML are transforming industries by streamlining operations, automating tasks, and creating specialized tech roles, such as Data Scientists and ML Engineers.
- Low-code and no-code tools impact the traditional development process, helping with rapid prototyping.
- The outsourcing software development market remains viable, with businesses seeking dedicated teams that transform legacy systems and deliver robust solutions rather than simply providing technical expertise.
- With over a decade of experience, LaSoft focuses on long-term viability by embracing innovative technologies and offering a solution-oriented approach, leveraging AI, ML, IoT, and low-code platforms to meet evolving client needs.
- Clients increasingly demand business solutions that address specific challenges and enhance operational efficiency rather than team-based software services. LaSoft follows the trend and is adapting by offering custom software solutions that deliver measurable results.
- LaSoft has adjusted its approach to project scoping and estimation by starting with the project discovery stage, ensuring realistic budgets and clear deliverables.
Factors Causing Instability in the Software Development Market
- Economic fluctuations due to war in Ukraine and Israel, and an unstable geopolitical situation;
- AI offers technological transformation in many industries;
- The rise in demand for no-code and low-code solutions;
- Changes in the outsourcing market, which should be taken into consideration while building a business strategy;
Economic Factor in Custom Software Development Services
Economic fluctuations affect the custom software development market in many ways, including demand, project scope, and budget. During economic growth, businesses are more willing to invest in custom software. With a bigger budget, companies will be interested in complex long-term software projects that align with their specific operations and growth strategy.
On the other hand, companies will cut back on IT spending during economic downturns or times of uncertainty to save resources. Custom software development, especially if expensive, will be delayed, scaled back, or even stopped altogether. In such times, businesses prioritize smaller, short-term projects that deliver immediate value over large custom software initiatives. Under such conditions, customers sometimes consider shifting towards “cost-saving” technologies like low-code and no-code platforms.
Economic factors also impact outsourcing trends in software development. During an economic slowdown, companies look for more affordable development options and often outsource to stable regions with lower labor costs. A good example is the recent growth of software development services in Latin America, which is considered a relatively stable region.
Sources: Grandviewresearch
Top players from the enterprise software segment will focus more on high-quality, niche, or specialized developers, even if they cost more. At the same time, SMB players will recruit talent to achieve an optimal cost vs quality balance.
Another impact of economic changes is the shift in demand for emerging technologies. During stable periods, companies will invest in advanced technologies like AI, blockchain, or IoT that require innovation and custom software solutions and expertise. In economically challenging times, demand for basic, maintenance-oriented software development increases and focuses more on system optimization, security, and cost efficiency.
Real Situation in the Custom Software Development Market: Slowdown and Its Impact
Despite reports by Statista and other research platforms, the software development market has started experiencing a significant slowdown, which is reflected in reduced hiring activity, layoffs, and a decline in demand for tech positions.
If we observe the situation in the large enterprises segment, we can learn that the wave of tech layoffs continues into 2024; this year, we have already seen over 130,000 job cuts across 457 companies, according to the independent tracker Layoffs.fyi,
Giants like Tesla, Amazon, Google, TikTok, Snap, and Microsoft have implemented layoffs at the beginning of 2024. Additionally, smaller startups experienced considerable downsizing, some even shutting down operations entirely.
US Tech Sector Layoffs in Public and Private Custom Software Development Companies, 2022-2024
Source: Trueup.
US Tech Sector Layoffs in Public and Private Custom Software Development Companies, 2022-2024
| Year | Layoffs |
| 2024 | 94.733 |
| 2023 | 191.000 |
| 2022 | 93.000 |
Source: Crunchbase
Many companies cut costs, including reducing tech budgets and delaying large-scale software projects. Concerns about a potential economic downturn due to global instability and economic uncertainties have led companies to adopt a cautious approach, focusing on essential operations rather than expanding IT teams or initiating new development projects.
Source: Axios
Another factor in massive layoffs is that in previous years, many companies, particularly in tech, expanded their workforce rapidly to invest in digital transformation or new digital product development. As demand stabilizes, these companies are scaling back, resulting in layoffs and pausing cooperation with outsourced teams.
Influence of Artificial Intelligence on the Tech Job Market
Significant technological transformations can significantly impact the advancement of AI or ML. While it may still have limitations, it will undoubtedly continue to evolve. AI is already offering new opportunities for businesses to reduce repetitive, simple tasks, streamline business operations, help automate routine tasks, help a team with data processing and building strategies, effectively communicate with customers 24/7, offer technical support, etc. Is there a negative impact of artificial intelligence on employment? Find out more about the effects of AI on the labor market.
Artificial Intelligence Market Size, 2020-2030
Source: Statista
Machine Learning, a subset of AI, has significantly influenced the job market by creating new roles and fields. Specialized jobs such as Data Scientists, ML Engineers, and AI Specialists have appeared. These roles focus on building, training, and optimizing ML models to analyze large data sets and generate predictive insights. Beyond direct ML-focused positions, this technology encouraged development for fields like Data Engineering and Ethics in AI, where experts manage the data pipeline, ensure model accuracy, and address ethical considerations in AI applications. This ongoing evolution has broadened the scope of career opportunities, shaping a workforce skilled in leveraging ML to drive business intelligence, innovation, and operational efficiency across industries. This is the problem our world will be experiencing for the next 10-15 years, reducing demand for low-skilled workers and increasing demand for high-skilled workers. According to McKinsey’s report, AI may displace around 300 million jobs globally. Another report suggests that as early as 2030, AI could contribute to creating 20 million to 50 million jobs.
No-code and Low-code Software Development
Low-code and no-code software have transformed the software development market by providing diverse software solutions across multiple industries, thereby reducing reliance on expert developers and expediting project timelines. These platforms enable companies to save time by building apps, analytics dashboards, and platforms using drag-and-drop interfaces, pre-built templates, and intuitive customization options. Still, the client must find no-code or low-code developers to build functional initial solutions, like prototypes or MVPs.
Businesses get apparent benefits, such as:
- Launching their product to market faster,
- Validating product ideas,
- Get customers’ feedback on functionality to adapt the product later to market changes and preferences,
- No-code and low-code tools support agile methodologies, enabling rapid development cycles.
This option supports digital transformation initiatives by enabling small and medium enterprises and startups to develop initial custom apps and tailored software solutions, providing cost-saving options and eliminating the lengthy timelines associated with traditional development.
Changes in Outsourcing Custom Software Developers
There are concerns due to the political situation in outsourcing to Eastern Europe, particularly to Ukraine. The war factor builds the impression of instability in customers’ minds. However, Ukrainian companies continue to address the issue by opening offices in various countries, distributing teams across different regions, and launching new products for clients worldwide.
High competition and clients seeking solutions to their problems, rather than just professional teams, pose challenges in the market. These changes in the market also reflect that firms focus on using in-house resources. Still, Statista predicts growth in the outsourcing market; however, any custom software development company should focus on refining its strategy and business value.
Source: Statista
What is the IMD World Digital Competitiveness Ranking and How It Impacts the IT Market
To gain valuable insights into growing and developed markets that are ready for digitalization, anyone concerned can explore the IMD World Digital Competitiveness Ranking (WDCR) for potential partnerships for transformation. It is a report published annually by the IMD World Competitiveness Center, measuring the capacity and potential of 67 global economies to adopt and explore digital technologies. Emerging technologies are a core driver for economic and social transformation.
Global studies show that countries ranking higher in this report consistently achieve greater GDP growth, attract foreign investment, and maintain higher living standards.
The WDCR evaluates countries across three primary dimensions:
| Knowledge | It derives from the level of educational infrastructure, which underlies the process of digital transformation through the discovery, understanding, and learning of new technologies, research, and development (R&D). |
| Technology | The report assesses a supportive regulatory framework that not only ensures the efficient execution of business activities and the enforcement of regulations but also fosters business development and technological innovation. |
| Future readiness | The report evaluates how prepared an economy is to embrace and drive digital transformation. Achieving true competitiveness requires more than just having access to digital technologies; it demands that these technologies are fully adopted and integrated into society. Successful adoption depends on a society’s adaptive mindset and readiness to engage in digital processes, such as online transactions, e-services, and other technology-driven activities that shape modern economic and social dynamics. |
Why It Matters for the IT Market
Tech investors, business leaders, and government officials use the WDCR to gauge which economies are best positioned for digital growth, helping to identify countries and emerging markets. For businesses evaluating nearshore vs. offshore, WDCR offers actionable intelligence on talent availability, digital maturity, and resilience, key factors in selecting the ideal partner for software development projects.
Key Highlights from WDCR 2024
Top Performers: Singapore leads globally, followed by Switzerland and Denmark — underscoring their digital strength.
Expanding Scope: The ranking now includes more economies, such as Ghana, Nigeria, and Puerto Rico, broadening global digital competitiveness data.
In summary, the IMD World Digital Competitiveness Ranking provides business decision-makers with a powerful benchmark, highlighting economies that combine digital talent, tech infrastructure, and future readiness. For companies looking to build or expand a nearshore development strategy, particularly in Central and Eastern Europe, the WDCR offers clear evidence of where quality, affordability, and resilience converge.
Top 20 the 2024 IMD World Digital Competitiveness Ranking
- SG
- 100
- CH
- 93.15
- DK
- 91.99
- US
- 91.31
- SE
- 90.42
- KR
- 88.62
- HK
- 88.11
- NL
- 87.03
- TW
- 86.33
- NO
- 84.58
- AE
- 84.06
- FI
- 83.57
- CA
- 83.16
- CN
- 82.59
- AT
- 81.24
- IL
- 80.75
- IE
- 80.34
- UK
- 78.21
- IS
- 78.18
- FR
- 76.58
- BE
- 75.61
- LT
- 75.56
- DE
- 75.32
Source:IMD
LaSoft Prospects in the Developing Custom Software from Andriy Tatchyn
LaSoft, a custom software development company with over 10 years of experience serving SMBs and enterprise-level clients, has navigated this crisis relatively stably. Our firm shows a growth of 10%-15%. So the question we face is about more than just sustaining the business or preparing it for the future challenges; it’s about ensuring long-term viability until 2030 and beyond.
We must diversify our offerings by investing in new technologies, such as AI and low-code/no-code solutions, and focusing on markets where highly skilled expertise is more important than basic development work. We continue to move forward, creating customized software solutions that meet the diverse needs and niches of our clients, making them both practical and affordable.
Examples of Our Ready-to-Use Digital Products
Out-of-the-Box Dashboard Constructor by LaSoft
The LaSoft team experts know how KPI analysis can drive critical processes and enhance customer interactions. This understanding inspired us to create a tool for effectively evaluating various business processes and outcomes. We have developed a ready-to-use analytics dashboard system that efficiently visualizes data for companies across different industries.
This solution allows managers to rely on our all-in-one tool to streamline data analysis and decision-making. Our analytics dashboard is a valuable option for companies seeking to implement data-driven insights without the time-consuming and costly custom development process. Featuring a comprehensive widget library, it allows users to customize or modify dashboards as needed, ensuring a tailored solution that meets unique business requirements.
LiveCharts by LaSoft Innovation Lab
We created our Innovative Lab to offer our clients solutions that can help promote their business and brand loyalty. As a pilot project, our team has developed Live Charts, a solution designed to deliver content to end users most engagingly. It helps create dynamic, visually compelling charts to add to any website, blog post, or online article.
Strengthening our resilience through partnerships, emphasizing quality, and exploring niche areas within software development could enable us to survive and lead in this new paradigm. Looking ahead, our adaptability and proactive approach will define our place in the industry in 2030.
AI Assistant For Logistics Companies
LaSoft introduces an AI Voice Assistant designed explicitly for the logistics industry. This advanced tool supports brokers by automatically validating carriers and negotiating competitive rates, saving time and optimizing negotiation processes.
Our expertise lies in creating software solutions that streamline workflows and automate business processes for our clients. The AI Voice Assistant simplifies logistics operations by:
- Validating MC numbers for efficient carrier selection;
- Negotiating prices based on the target cost per load;
- Ensuring 24/7 service availability while reducing labor costs;
- Finalizing shipping details and preparing deals for manager review.
- This solution enhances efficiency, reduces costs, and simplifies the complexities of logistics workflows.
CommUNIty Solution: An AI-Powered Social Network for Higher Education
In an academic environment, universities and colleges need more than static LMS systems or overburdened email threads. The Lasoft team researched the edtech market needs and developed an off-the-shelf solution, CommUNIty. Our AI-managed internal social platform redefines digital campus life by facilitating interactions between teachers, education staff, administrators, and students. Let’s explore the benefits our clients gain by implementing this solution.
Streamlining Administrative Workflows
Gone are the days of digesting masses of emails and pinging through slow LMS interfaces. With CommUNIty, routine questions, such as course deadlines, exam times, webinar links, or department announcements, are handled instantly by an AI assistant trained to understand academic language and context. The advantage is obvious, professors spend less time repeating answers and more time focused on teaching. Administrators gain visibility into trending inquiries, enabling them to address concerns and prioritize policy updates preemptively.
Elevating Student-Faculty Interaction
CommUNIty is designed like a private social network, mirroring platforms students already know. Students post questions, share ideas in group chats, or message instructors directly. Behind the scenes, the AI agent organizes these conversations, surfaces patterns, and nudges faculty to respond. It sends real-time notifications for assignment changes or upcoming events, ensuring students stay informed and engaged.
Personalizing Academic Support at Scale
CommUNIty’s AI bridges that gap by analyzing sentiment in posts, flagging signs of disengagement or confusion. It surfaces personalized learning suggestions and reminds students about critical academic milestones.
Amplifying Learning Beyond the Classroom
The platform supports profile pages for professors and courses, acting like a dynamic directory where students can explore faculty of interest and access office hours. Event and webinar notifications appear in personalized feeds, while integrated calendars and reminders ensure learners never miss a workshop or consultation.
Why CommUNIty Works Where Traditional Tools Fall Short
| Familiar UI, Education-first Design | Students interact via a social media-style interface, but tailored to respect privacy and academic structure. |
| AI That Serves, Not Replaces: | The assistant handles routine tasks, freeing staff for creative teaching. |
| Data-Driven Support: | Engagement analytics and sentiment insights let educators understand student needs. |
| Built for Scale and Compliance: | From colleges to entire university systems, CommUNIty grows with your institution while honoring privacy standards and data security. |
Andriy Tatchyn, the founder of LaSoft, shares how the team finds opportunities in market changes
How is LaSoft addressing any perceptions of risk related to outsourcing to Ukraine, especially from a geopolitical uncertainty perspective?
The geopolitical events are affecting the perceptions of outsourcing to Ukraine, so we’re actively working to build confidence in our stability and resilience. We’ve opened offices in Poland, which is protected by NATO alliances. 37% of our employees work from locations other than Ukraine, and those who still stay in Ukraine are located in Lviv (the west and the safest part of Ukraine). Even those employees can be relocated to Poland if there is an urgent need. We never stopped our operations for the last 2 years of work, not for a single day.
In 2022, we sent our clients weekly status updates on our Business Continuity Activities. By 2025, we will be well-prepared, and we will now provide these updates only once a month. Our commitment to uninterrupted service delivery and proactive risk management reassures clients that LaSoft is fully prepared to handle any challenges that may arise.
Considering the trend toward solution-based development over team-based services, how is LaSoft positioning itself to meet clients’ changing expectations?
At LaSoft, we understand how global economic changes impact our clients’ priorities and project expectations. Our team has shifted to a more adaptive, solution-oriented approach to achieve specific business outcomes rather than focusing solely on technical development. As many companies aim to become sustainable and conserve resources like time and money, our team implements advanced technologies to automate business processes, helping companies become client-oriented and competitive.
LaSoft Admin Panel
We offer our product admin panel by LaSoft as a low-code solution for the fast and cost-efficient implementation of admin systems; it allows clients to save approximately 35%-40% on developing complex custom admin systems.
Built with predefined components, the LaSoft Admin Panel allows you to create, update, and manage instances (users, companies, products, vendors, etc.) while ensuring seamless interdependencies between them. It’s about efficiency and full customizability to your company’s branding, workflows, and specific business needs.
Our admin panel offers customizable designs, including color schemes, fonts, icons, and branding, to suit your preferences. Thus, the client can create a user-friendly interface consistent with the corporate identity.
Dynamic functionality allows the addition of industry-specific workflows, dashboards, analytics, onboarding processes, and verification workflows to suit your operational needs. Our panel helps manage, control, and visualize data from one centralized workspace — without writing a single line of code.
The LaSoft Admin Panel has been successfully tested and implemented in numerous projects, including HR management, legal compliance, sales, and real estate applications.
With the increasing importance of digital transformation technologies like AI, ML, and IoT, how is LaSoft preparing to leverage these for a competitive advantage?
Our software engineers are fully committed to elevating expert skills in emerging technologies, and we’re actively incorporating AI and ML into our projects. We continually invest in upskilling our team, teaching newcomers in our LaSoft Academy, forming professional groups, and refining our technical expertise to integrate advanced technologies into products that deliver competitive advantages for our clients. Our teams focus on creating customized software development projects and off-the-shelf solutions that help automate the company’s processes and can be adjusted to our clients’ strategic goals.
AI Project Example: Age Line: An Open-Source Solution
Age Line is an innovative platform designed to address the challenges of an aging society. It is a resource that helps seniors make informed decisions about where to live, access healthcare, and discover programs and businesses tailored to their needs. AI technology and a data-driven approach help Age Line provide reliable, actionable content to enhance the quality of life for older adults.
One of Age Line’s standout features is aggregating complex user reviews and average location ratings from top evaluation platforms across the US, which delivers accurate assessments of living options.
The LaSoft team was crucial in developing Age Line by integrating an advanced machine-learning solution into the platform. This innovative system automatically finds relevant city photos and updates the database without human intervention. By automating this repetitive task, the solution saved the client an impressive $300,000—equivalent to 30,000 hours of manual work.
Do you believe that LaSoft’s future lies more in developing specific products and point solutions than in traditional custom development? How might this shift impact LaSoft’s business model?
It’s part of our strategy. LaSoft continues to focus on developing products and targeted solutions that solve specific business challenges, as well as custom development. We have created the Lasoft Innovation Lab to develop software solutions that help businesses gain valuable tools for commercial success.
For example, our team created Live Charts, a solution intended to bring any content to a final user in the most engaging way, according to our research findings and user feedback. Live Charts platform allows you to create engaging, dynamic visuals that can be easily integrated into any website, blog post, or online article.
Our tool offers a variety of customization options, so you can tailor the charts to fit the specific needs of your content. Whether you’re highlighting trends, comparing data sets, or breaking down complex information into digestible visuals, Live Charts can transform how your audience experiences your content, get more traffic to your digital product, and build brand awareness among customers.
Our proactive shift aligns with the market’s demand for solutions that deliver immediate and measurable impact. This may result in a hybrid model of custom development and off-the-shelf software. As we explore this direction, we’re also mindful of how it will enhance our value to clients as a custom software development team. Explore our web-based solution.
How does LaSoft view the rise of low-code and no-code platforms? Are they seen as a threat to traditional development or as an opportunity?
At LaSoft, we consider the rise of low-code and no-code platforms a significant opportunity rather than a threat to traditional development. We utilize these solutions to validate market ideas when our clients require urgent MVP testing.
DataPoint as a Low-code Solution from LaSoft
We plan to launch DataPoint in 2025 for startups, small and medium businesses, and large enterprises. This customizable low-code solution will help companies with data integration to analyze and visualize metrics. Unlike other data analytics platforms is a ready-to-use system that seamlessly connects to any data source and allows users to create customized analytics dashboards.
You can integrate this solution with various data sources, including databases, APIs, cloud services, and spreadsheets. We aim to ensure that DataPoint helps consolidate your business information in one place.
A low-code solution with minimal coding effort means you don’t need advanced programming skills to create dashboards. With a library of widgets, charts, and design templates, you can easily configure and customize dashboards to meet your specific business goals with drag-and-drop ease. Change layouts, customize visual elements, and create interactive reports.
How has LaSoft adjusted its project scope and estimation approach to facilitate practical cooperation with clients and benefit all parties involved?
We’ve adapted our project scoping and estimation approach to ensure fair, mutually beneficial cooperation. As a vital part of our services, we advise our clients to do the discovery stage to validate a business idea and then test it in the market with a prototype or MVP.
This stage helps estimate costs and set realistic budgets, align clear deliverables from the outset, and create adaptable project scopes. Estimating a project’s time and cost is an essential part of the project discovery process. Our team developed LaEstimator, an accurate estimating tool, to help you plan resources and budgets effectively. Our tool provides a transparent view of project costs and realistic timelines for delivering the final product. This information helps with the allocation and management of financial resources.
