Dedicated Development Team in Eastern Europe in 2025 

To hire a software development team abroad is no longer an exception—it’s the new black. And it’s no surprise: with the software market growing from $9.8 billion in 2025 to an expected $17.1 billion in 2029, Eastern Europe is becoming the top choice for tech companies looking to tap into new market potential while optimizing costs. Now’s the time to explore what your business can gain from this rise and what unique value proposition Eastern Europe has to offer you. 

I’m Maryna Panchuk, Head of IT Recruitment at Alcor—a tech R&D accelerator that helps you hire elite software developers from Eastern Europe while providing a 360-degree EOR coverage and operational support. We build fully integrated teams at 40% lower cost and with no buy-out fees compared to traditional IT outstaffing.  

In this article, you’ll uncover the key reasons for choosing EE as your next destination for building a dedicated development team, learn how to navigate potential challenges, get actionable tips on choosing a reliable partner, as well as a curated list of top locations to hire highly skilled dedicated developers. 

Key Takeaways

1. A dedicated development team is a group of skilled professionals who work exclusively on a company’s software product and are hired through a staffing provider.
2. Key reasons to hiresoftware developers from Eastern Europeinclude access to a 1.8K talent pool and up to 55% savings on developer salaries compared to the US. Plus, strong tech and data science skills, combined with a Western mindset, make these engineers a perfect match.
3. Countries like Poland, Ukraine, Romania, and Bulgaria offer a vasttech talentpool, top-notch STEM graduates, favorable taxation, and the opportunity to enable round-the-clock product development.
4. Choosing the cooperation model is one of the most important steps when building a DDT. Ensure that you check their employment options (e.g., FTA vs. B2B contracts), tech expertise, client reviews, and ability to scale the team according to your needs.
5. An alternative approach to building a development team is to establish your own tech R&D center. This model allows you to manage your own team directly, retain full control, and ensure long-term scalability.

What Is a Dedicated Development Team?

A dedicated development team is a software crew that works exclusively on your product but gets hired by a staffing provider. Oftentimes, such a team works on a remote basis and consists of software developers from different locations, allowing the company to save on salaries, taxes, office maintenance costs, and operational expenses. Dedicated development teams work best for S&M-sized tech companies that struggle to finding experienced professionals to enhance their engineering teams or seek ways to expand into the market. This business model can help reduce costs without compromising on necessary expertise. Below, you will find more benefits of a dedicated development team and reasons to hire software developers from Eastern Europe.  

7 Reasons for Hiring Eastern European Developers

1. Tech talent goldmine  

Did you know that today, Eastern Europe is home to over 1.8 million tech specialists? The first place in this region is taken by Poland, which boasts the biggest number of tech talents – 650K. In the second place, we find Ukraine, with about 302K programmers. Then, the list is followed by Hungary (253K), Romania (250K), and the Czech Republic (130K). For tech leaders hungry to grow their development teams, Eastern Europe is a truly golden ticket to scale faster. 

2. Affordable remunerations 

Big talent pool—big cost? Not at all! In the case of software developers in Eastern Europe, you can tap into a massive pool while keeping your budget in check. The annual salary rates for these professionals are approximately 20% lower than in Western Europe, and when compared to the US and Canada, you could save up to 55%—all without sacrificing software quality. Compare the rates in the table below to see yourself.  

Average Annual Software Developer Salary
	Middle	Senior	Team Lead
USA	$97,100	$118,600	$142,00
Canada	$113,000	$132,000	$150,000
Germany	$73,500	$90,000	$109,000
UK	$64,000	$83,000	$120,000
Ukraine	$40,000	$62,000	$74,300
Poland	$51,200	$75,300	$89,000
Bulgaria	$42,800	$65,000	$77,000
Romania	$48,000	$71,600	$84,200

Explore our research on React Developer salary, QA engineer, and iOS developer salaries—or contact us for custom salary insights! 
 

3. Versatile expertise 

Another vital reason why international tech companies prefer building an outsourced dedicated development team in Eastern Europe is the high level of expertise and talent among local software developers.  

• Top-quality STEM education 

Technical education in Eastern Europe is globally recognized. This region provides higher STEM education in around 300 HE institutions, a good share of which can be found in the QS World University Rankings 2025: Top Global Universities. Among them are such leading universities as Warsaw University of Technology, National Technical University of Ukraine, Politehnica University of Bucharest, and the Czech Technical University in Prague.  

Overall, computer science and software engineering have been gaining popularity among young people in Eastern Europe, resulting in a steady increase in tech students and graduates in the region. For instance, Poland had an impressive number of 73,850 ICT students in the 2023/2024 academic year, which is 3,200 more compared to the previous year. 

• Exceptional tech skills 

What else makes outsourcing recruitment of software developers to Eastern Europe highly attractive for technology companies is an up-to-date attitude to the latest tech trends/practices and expertise in a broad array of programming languages among local developers: 

Poland: JavaScript, Java, Python, TypeScript 

Romania: PHP, C#, Java, C++ 

Ukraine : JavaScript, Java, C#, Python, and PHP 

Bulgaria : C#, JavaScript, Java, and Python   

Their deep tech expertise is undeniable, as Eastern European programmers consistently top Coursera’s ranking. When it comes to data science skills, the top-3 positions are held by the Czech Republic, Bulgaria, and Ukraine. In contrast, Poland, Czechia, and Slovakia lead the pack in tech proficiency. 

• High English proficiency  

According to the EF English Proficiency Index, Romania, Poland, and Bulgaria rank among the top 3 in the region for English proficiency. Moreover, it’s not uncommon for these engineers to be fluent in an additional European language, such as French, German, or Spanish. This makes Eastern European software developers even more attractive, as effective communication is key to successful collaboration. 

4. Western-oriented mindset 

When it comes to building a dedicated software team in any offshoring destination, many tech leaders are concerned about the potential cultural barriers. However, if they choose to transfer software engineering to Eastern Europe, this won’t be a problem, as they feel an affinity with Western values and work ethics. Furthermore, these engineers can easily adapt to new working conditions and contribute to building a healthy workplace environment.  

5. Business-friendly environment  

Every year, the governments of Eastern European countries develop new legislation and policies aimed at simplifying business and tax conditions to attract more high-profile companies to their local markets. And here’s something interesting: 

• Poland: Grants a 200% tax deduction on R&D costs, covering expenses like employee wages, materials, research services, and specialized equipment, making it highly attractive for innovation-driven businesses. 
• Romania: Allows an additional 50% deduction on R&D expenses, accelerated depreciation for R&D equipment, and a 10-year profit tax exemption for companies focused solely on innovation and R&D, maximizing long-term financial benefits. 

• Ukraine: Ukraine’s Diia.City offers a special legal and tax regime for the tech sector. It features favorable tax rates (personal income tax of 5% and social security contributions of 22% from a min. salary of $41.6/month) and flexible employment through gig contracts, providing cost-effective and scalable solutions for tech businesses. 

Currently, a US-based tech company, People.ai, is benefiting from Ukraine’s budget-friendly developer salaries and taxes with its own R&D center. Alcor took the first step by devising an efficient legal structure and setting up the office in just one month while hiring and onboarding a team of 25+ hi-tech developers in Eastern Europe. Then, People.ai took the next one—scaling its development to a new level and transforming into a tech unicorn that builds the industry’s leading data and AI platform.  

6. Cross-time zone collaboration  

Here are two cases showing how you can benefit from the time zone of your dedicated software development team in Eastern Europe: 

Case 1: If you’re a tech executive of a Western European tech company, the optimal geographic location and average time difference of just 1–2 hours allow your nearshore developers from EE to follow the same schedule as your headquarters. This enables real-time collaboration and streamlined communication between your teams. 

Case 2: If you’re a CTO of a US-based tech business, you can fully leverage the 6–7-hour (East Coast) to 10-hour (West Coast) time difference to create a round-the-clock development process. When your day ends, your Eastern European developers are just getting started—implementing your feedback, refining your product, and continuing development while you rest.  

7. Robust data security

Another reason why it’s a good idea to have a team for software development in Eastern Europe is data privacy and protection. Since most countries of this region are EU member-states, they are obliged to follow its regulatory structure, such as GDPR, and comply with international standards like ISO/IEC 27001, while CCPA is relevant when working with US companies. 

To protect your IP rights and ensure full compliance of your business, an experienced provider who knows the international tech landscape like the back of their hand is essential.  

Alcor—Your Trusted Partner in Building Dedicated Development Teams

As an R&D center accelerator, we specialize in building loyal teams of 10 to 100 developers within a year across Eastern Europe and Latin America. Our all-in-one place solution is tailored to the expansion needs of hi-tech companies and offers: 

– Comprehensive EOR for tech services: Alcor’s team handles all aspects of developer employment, from FTE and B2B contracts, SLAs, NDAs, on/offboarding to compliance with local labor laws, payroll processing, and employee benefits management, freeing you to focus on scaling your business. 

– Top-notch talent recruitment: Our 40 tech recruiters specialize in securing the top 10% of senior and lead software developers from Eastern Europe and LATAM, with 80% of candidates advancing to the interview stage. It takes us only 2-6 weeks to close a vacancy, while 98,6% of hires pass probation successfully. 

– Holistic back-office support: From arranging office and coworking space leases to purchasing the necessary hardware, Alcor ensures a seamless operational setup and 24/7 in-country support. 

Why choose our R&D center over other models? Because you deserve a development team for ownership and progress, not just access and process. With our solution, you   

• Build a team of 30 Silicon Valley-caliber talents in 3 months, 

• Enjoy full integration and loyalty of developers from day one,  

• Avoid any buy-out fees, pre-payment, and markups, 

• Scale with ready-made legal entities, 100% compliantly.  

Real Example of Hiring a Dedicated Development Team in Eastern Europe

Once, Dotmatics, a US-based product company that develops scientific software, was in your shoes. They wanted to enter a new Eastern European market without taking on the risks of IT outstaffing. Instead, they decided to set up their own engineering team with Alcor. Here’s what their choice brought them:  

• Hiring: We dedicated 4 headhunters who hired 30+ seasoned software developers, including a Director of Engineering, Full Stack, React, QA Automation, DevOps, Node.js, and other engineers. 

• Legal: We managed payroll and accounting, ensured legal compliance, handled onboarding and offboarding, processed remuneration remittance, and took care of benefits management, allowing Dotmatics to skip the red tape and focus on scaling their business. 

• Operational: With our continuous operational support, laptop procurement for developers was handled efficiently and within a short timeframe. 

Which Country in Eastern Europe to Choose for Software Development?

Poland 

Although this country is considered one of the most popular destinations to hire developers in Eastern Europe, IT recruitment in Poland and its business conditions are not devoid of peculiarities. According to the Global Business Complexity Index, Poland ranks 2nd in Eastern Europe. This is due to constantly changing legislation and a compounded tax system.  

The latter is closely connected to another issue—different types of employment. Despite the obvious financial advantage of B2B contracts, the Umowa o prace (employment contract) continues to dominate the market. Thus, if you plan on recruiting Polish software developers, consult a professional service provider who will help you employ specialists on the best terms and make your business legally compliant. 

Romania

When it comes to offshore software development in Eastern Europe, building a team of programmers in Romania may be trickier due to its limited number of tech hubs. Unlike Poland, which has six major tech centers, Romania can only account for one really developed hub—Bucharest—and two emerging ones: Cluj-Napoca and Iași. Consequently, this fact can affect the hiring process. However, if you partner with an experienced local provider, you shouldn’t have to worry about time-consuming talent acquisition in Romania.   

Ukraine 

Ukraine ranks second in Eastern Europe in terms of the number of tech professionals and shines with prominent tech hubs, including Kyiv, Lviv, Dnipro, Kharkiv, and Odesa. A fast-growing tech landscape and strong AI expertise are driving Ukraine forward.  

As of 2025, the country is home to 13,200 AI and ML developers, while its startup ecosystem keeps evolving thanks to emerging unicorns like Creatio—an AI-native platform that automates CRM and workflows with no code. The result? A 120% increase in the tech sector investments in 2024 compared to the previous year. However, the ongoing war may pose certain challenges to business expansion, making a local partner a guiding star to navigate these risks. 

Bulgaria

Bulgaria is an appealing offshoring destination due to its #1 position in EE for data science skills. What is more, the country has a stable tech market and is even ranked the #3 innovation economy in the region. Its developers also place #4 among European countries in software engineering, web, and mobile development.  

Last but not least, 50 STEM universities in Bulgaria add 6,100 skilled ICT graduates annually to its talent pool—yet, it’s still not enough. That’s where a local partner becomes your magic wand to reach your staffing goals.

Things to Consider Before Hiring a Dedicated Development Team in Eastern Europe

Choosing the right cooperation model

• IT outstaffing: The provider assigns their software developers to your project on a temporary basis. This model offers fast access to tech talent and minimizes your legal and admin responsibilities. However, it also comes with lower developer loyalty, as these engineers are likely to be reassigned to another project within a year. In addition, you may face buy-out fees if you decide to hire them directly, and there’s a common practice of selling lower-level developers at senior engineer rates. 

• Tech recruitment: Involves sourcing, screening, and hiring IT specialists directly to your in-house team through a local recruitment partner. This model can be cost-effective if your company already has a legal presence in the local market. However, you’ll need to take full responsibility for all HR tasks, as well as legal, tax, and administrative matters.

• Software R&D Center: This means building your own development office in another country with a full-fledged team and operational support. The R&D center provides you with full control over your engineering team, along with a strong dedication and genuine interest in developing your product. You also benefit from long-term cost efficiency and business stability. However, keep in mind that this approach requires excellent knowledge of the local market and comprehensive legal and operational support. 

Pro tip: If you only need 2–3 specialists for a short-term project, IT outstaffing or tech recruitment would be more cost-effective solutions. But if you’re a serious tech company looking to scale in a new location and work with dedicated developers, then an R&D center is your ideal choice.

Employment option

Another important step is selecting the employment model. Whether it’s hiring full-time employees (FTE) through a local entity or engaging developers via B2B contracts, each approach comes with its own features.  

• FTE contracts: This model involves setting up your own legal entity in a foreign country and officially hiring developers as full-time employees. Here, employers have minimal chances of employee misclassification and lower turnover risks, while developers are better protected by labor laws.

• B2B contracts: In this case, developers work as independent contractors or sole proprietors, signing a business-to-business agreement with your company. This model offers flexibility, low administrative overhead, and cost optimization due to the absence of social benefits and employer tax obligations. 

Pro tip: Consider the pros and cons of each hiring model, along with the specific tax implications that come with them. Alcor’s legal team, with IT-focused expertise, can guide you through the process just like we did for Franki. 

Legal entity

Every Eastern European country has its own mix of legal specifics for business incorporation. If you decide to establish your own legal entity, make sure you’ve thoroughly researched the local legal landscape and understand all the nuances. Otherwise, you risk facing issues or penalties for non-compliance with local legislation. Also, keep in mind that in this case, you’ll be fully responsible for tax management, which requires a team of experienced payroll managers. 

Pro tip: If you have strong internal capabilities, setting up a legal entity may work for you, offering control and stability. However, keep in mind the complex tax and legal specifics in each country. That’s why many tech companies choose tech-focused EOR services to avoid local pitfalls and ensure full compliance from day one. 

Remote team management issues

Some tech owners get frustrated while pondering the challenges of managing offshore teams. These may include chaotic communication, impeded progress tracking, and decreased team productivity. But in reality, the devil is not as black as he is painted. If you take into account the nuances of remote team management, it can become just like having in-house developers.  

Pro tip: Focus on key aspects such as establishing a solid workflow, scheduling regular meetings, utilizing effective management tools, and fostering team spirit.  Or choose to build a dedicated offshore development center, where developers are truly yours from day one, fully aligned with your corporate culture and a perfect cultural fit. 

5 Roles and Responsibilities of a Dedicated Development Team in Eastern Europe

Speaking about software development outsourcing in Eastern Europe, what positions in your team can you cover? With almost two million qualified specialists on the market, the answer is – just about any. Still, let’s take a more detailed look at five key roles in a software development team to ensure.  

1. Tech/Team Lead

A tech team lead is a programmer with vast experience and a notable technical stack who is responsible for guiding and mentoring coders in technical matters, reviewing their code, and making decisions regarding system modifications. Additionally, you might need to hire a team lead who is focused on creating a productive work environment, facilitating communication inside the team, motivating team members, and tracking the overall team performance. 

2. Product Manager

A product manager researches the market, oversees product development, and launches the product on the market. Their main responsibility is to help the company achieve its goals through the product. These specialists cooperate with software developers, business analysts, UI/UX designers, and other team members and conduct team meetings.  

3. Software Developers

Eastern European software developers can be a great extension to any tech team as they use their knowledge of the required programming languages, frameworks, libraries, and other technologies to create the product. For instance, Front-end and Back-end Engineers, as well as Full Stack Developers, abound in Eastern Europe. With Front-end specialists managing the outlook of the website and Back-end professionals dealing with its internal structure, one can assemble a full web development team or opt to hire a full-stack developer who is skilled in both fields. 

4. QA Engineers & Testers

These specialists have a shared responsibility, which is to ensure high product quality. QA Engineers analyze if the software or particular features work properly by creating test scenarios and applying them to identify software bugs and errors. At the same time, QA testers test websites and applications by making observations about the user’s journey, offering suggestions for improvement, and creating reports about the results. 

5. UI/UX Designers

UI/UX designers must possess skills such as developing wireframes, outlining user flow, researching the target audience, comprehending information architecture patterns, and utilizing visual design tools. UX designers ensure software accessibility to the users, and UI designers are in charge of the visual aspect. The goal is to ensure functionality and proper navigation on the website. 

Our 40 tech recruiters can easily find the exact expertise and cultural fit you’re looking for. Just share your hiring goals on a quick call, and we’ll send you a detailed report with the estimated cost of your future team. 

Tips to Hire a Dedicated Team Provider in Eastern Europe

Headhunting offshore programmers can be quite an arduous, time-consuming, and expensive process if done incorrectly. Thus, to successfully assemble a dedicated development team in Eastern Europe, think of cooperating with a local dedicated team provider. Consider the following features to select a trusted partner: 

Local IT market expertise

Deep knowledge of the local market is crucial when it comes to quickly and effectively assembling a top-notch development team. Your ideal partner should keep you updated on the availability of developers, their tech stacks, and salaries, as well as be well-versed in the tech industry and recruitment trends. Tech expertise is especially important. Many general vendors are not familiar with all the nuances of tech legislation in the EE market. Look for those who have been operating in your market for years and understand the local tech landscape. 

Vast tech recruitment experience

There are quite a lot of agencies that hire Eastern European developers, but have little to no experience in recruiting tech specialists for product software companies. How can you spot them in the crowd? Such vendors usually have a similar pattern of behavior: firstly, they bury you in irrelevant CVs to show how broad their candidate base is, proceed with job interviews without proper pre-screening of applicants, and then get stuck in the first phase of the interview just to stall and rip you off. To avoid taking the bait, pay attention to such defying aspects as:  

• a large team of seasoned tech recruiters;  

• an extensive internal candidate network;  

• outlined recruitment guarantees. 
• availability of case studies and client reviews on independent platforms that prove the company’s broad experience in tech recruitment. 

Well-thought-out hiring strategy

Your ideal tech staffing partner should possess a genuine interest and a strong desire to do their best to create a successful offshore team. To make it happen, they will present you with a well-elaborated hiring strategy that covers each stage of the recruitment process, including specified KPIs, a set of hiring technologies & resources, and details on pricing. 

Outlined guarantees

Finally, one of the most concrete indicators of the high professionalism and credibility of an IT recruitment agency is its guarantees. If a company can vouch for the quality of its product & services publicly, it’s a green light for you to consider partnering with them.