Should You Hire a UA Agency or Build In-House? (2025 Guide)

The decision between hiring a user acquisition agency and building an in-house team isn't binary.

Most apps that scale successfully use both at different stages. Early on, agencies provide speed and expertise. At scale, in-house teams offer control and institutional knowledge.

The key is knowing which model fits your current stage, budget, and strategic priorities.

Here's how to decide.

The Core Trade-Off

Agencies give you:

• Immediate expertise across channels and platforms
• Speed to launch without hiring and onboarding overhead
• Access to proven creative production and testing frameworks
• Flexibility to scale up or down based on performance

In-house teams give you:

• Full control over strategy, execution, and optimization
• Deep product and business context that agencies can't replicate
• Lower cost per dollar spent at scale (no agency fees)
• Institutional knowledge that compounds over time

The right choice depends on where you are and where you're going.

When to Hire an Agency

Agencies make the most sense in specific situations:

1. You're Just Starting Paid UA (Spending <$50K/month)

Why agencies work here:

You don't yet know which channels will perform, what creative concepts resonate, or how to structure campaigns efficiently. Agencies have launched hundreds of apps and can shortcut your learning curve.

Cost comparison:

• Agency cost: 15-25% of spend + potential minimum retainer ($5K-$10K/month)
• In-house cost: $120K-$180K/year for a mid-level UA manager + benefits + tools + creative production

At $30,000/month in ad spend, an agency costs approximately $35,000-$40,000/month all-in. Hiring one person costs $10,000-$15,000/month in salary alone, plus onboarding time, tools, and creative costs.

The math is clear: Below $50,000/month, agencies are more cost-effective.

2. You're Testing New Channels

Agencies that specialize in specific channels (TikTok, Snapchat, Reddit) have already solved the problems you're about to encounter.

What they provide:

• Platform relationships and account rep access
• Tested creative frameworks and production pipelines
• Benchmarks from similar apps in your category
• Faster time to insights (weeks instead of months)

Example:

Testing TikTok for the first time requires understanding Spark Ads, native video best practices, creative iteration cycles, and TikTok-specific targeting nuances. An agency that's launched 50 TikTok campaigns can get you to break-even in 4-6 weeks. An in-house hire learning from scratch might take 4-6 months.

3. You Need Creative Production at Scale

Creative is the highest-leverage variable in paid UA, but producing high-quality video and static ads consistently is expensive and operationally complex.

Agency advantage:

Many UA agencies include creative production as part of their service, with existing relationships with creators, video editors, and designers. They can test 10-15 creative concepts per week while your in-house team struggles to produce 3.

Why this matters:

Apps that refresh creative weekly see 30-50% better performance than those that refresh monthly. Agencies solve the creative bottleneck by having production infrastructure already in place.

4. You Have Budget Volatility

If your UA spend fluctuates significantly month-to-month (e.g., seasonal apps, fundraising-dependent growth), agencies offer flexibility that fixed headcount doesn't.

The benefit:

You can scale agency spend from $50K to $200K/month without hiring. You can pause or reduce spend without layoffs. This flexibility is valuable when growth is unpredictable.

When to Build In-House

In-house teams make sense once you've achieved specific milestones:

1. You're Spending $100K+/Month Consistently

At this scale, agency fees start to exceed the cost of full-time employees.

Cost comparison at $100K/month spend:

• Agency cost: $115,000-$125,000/month (15-25% fee)
• In-house team cost: $25,000-$35,000/month for 2-3 full-time employees (UA Manager, UA Analyst, Creative Producer)

The crossover:

Around $100,000/month in consistent spend, in-house becomes more cost-effective. At $250,000+/month, the cost advantage is significant.

2. Your Channels Are Proven and Predictable

If you've validated that Facebook, TikTok, and ASA work profitably, and you're optimizing for efficiency rather than discovering what works, in-house teams excel.

Why:

In-house teams can iterate daily, A/B test incrementally, and optimize based on deep product knowledge. Agencies are better at 0-to-1 discovery. In-house teams are better at 1-to-10 optimization.

3. You Need Tight Product-Marketing Alignment

Agencies execute based on the brief you provide. In-house teams sit in product meetings, understand roadmap priorities, and align UA strategy with product launches.

Example:

If you're launching a new feature that fundamentally changes your value proposition, an in-house team can immediately shift messaging, creative, and targeting. An agency requires a new brief, creative production cycle, and approval process—adding weeks of lag.

4. You Want to Build Proprietary Capabilities

In-house teams build institutional knowledge that compounds over time.

What this looks like:

• Custom attribution models tailored to your business
• Proprietary creative testing frameworks
• Category-specific targeting insights
• Optimized campaign structures that reflect your unique LTV patterns

Agencies take this knowledge with them when they offboard. In-house teams make you smarter permanently.

The Hybrid Model (Often the Best Choice)

Most apps that scale past $200,000/month use a hybrid approach:

In-house owns:

• Strategy and budgeting decisions
• Campaign structure and optimization
• Attribution and analytics
• Performance reporting and forecasting

Agencies handle:

• Creative production and testing
• New channel exploration
• Specialized campaigns (influencer, content networks)
• Surge capacity during peak periods

Why this works:

You maintain strategic control and institutional knowledge while accessing specialized expertise and creative production at scale.

Example structure:

• In-house: 1 Head of Growth, 1-2 UA Managers, 1 UA Analyst
• Agency: Creative production partner ($10K-$15K/month retainer) + new channel testing agencies as needed

This gives you the control and efficiency of in-house with the speed and creativity of agencies.

Cost Breakdown: Agency vs In-House

Agency Model

Typical structure:

• Management fee: 15-25% of ad spend
• Minimum retainer: $5,000-$10,000/month
• Creative production: Often included, sometimes additional fee

Example at $100K/month spend:

• Ad spend: $100,000
• Agency fee (20%): $20,000
• Creative production: $5,000-$10,000
• Total cost: $125,000-$130,000/month

In-House Model

Typical team at $100K/month spend:

• UA Manager: $120K-$150K/year ($10K-$12.5K/month)
• UA Analyst: $80K-$100K/year ($6.5K-$8.5K/month)
• Creative Producer: $90K-$120K/year ($7.5K-$10K/month)
• Benefits (30%): $7,200-$9,300/month
• Tools (MMP, analytics, creative): $2,000-$3,000/month
• Freelance creative: $5,000-$8,000/month
• Total cost: $38,000-$51,000/month

Break-even point: Around $100,000-$150,000/month in ad spend, in-house becomes more cost-effective.

Common Mistakes

Mistake 1: Hiring In-House Too Early

You bring on a UA Manager at $20,000/month spend. They spend 3 months learning what an agency could have taught you in 3 weeks. By month 6, you're behind on growth targets and out $60,000 in salary.

The fix:

Start with an agency until you hit $50,000-$75,000/month in proven spend. Then transition.

Mistake 2: Staying with Agencies Too Long

You're spending $250,000/month and paying $50,000-$60,000 in agency fees. You could hire 3 experienced people for the same cost and have full control.

The fix:

At $150,000+/month, start planning the transition to in-house or hybrid model.

Mistake 3: Treating Agencies Like Outsourced Labor

You hand off UA to an agency and expect them to operate independently. They lack product context, can't attend roadmap meetings, and optimize for metrics that don't align with business goals.

The fix:

Even with agencies, you need internal ownership. Someone on your team should meet weekly, review performance, provide product context, and ensure strategic alignment.

Mistake 4: Building In-House Without Systems

You hire a UA team but don't provide clear KPIs, attribution infrastructure, or creative production support. They spend months building infrastructure instead of driving growth.

The fix:

Before hiring in-house, ensure you have:

• Clear LTV and CAC targets
• Functional attribution and analytics
• Creative production process (in-house or outsourced)
• Defined reporting cadence and accountability

Decision Framework

Use this framework to evaluate your current situation:

Choose an Agency If:

• You're spending less than $100,000/month
• You're testing new channels for the first time
• You need creative production at scale
• Your spend fluctuates significantly month-to-month
• You lack internal UA expertise

Build In-House If:

• You're spending $100,000+/month consistently
• Your primary channels are proven and predictable
• You need tight product-marketing alignment
• You want to build proprietary capabilities
• You have budget for 2-3+ full-time hires

Use a Hybrid Model If:

• You're spending $200,000+/month
• You have proven channels but want to test new ones
• You need strategic control but lack creative production
• You want to balance cost efficiency with specialized expertise

Transition Strategy: Agency to In-House

If you're moving from agency to in-house, plan the transition carefully:

Phase 1: Hire Your First UA Lead (Month 1-3)

Bring on a senior UA Manager or Head of Growth while the agency is still running campaigns. They shadow the agency, learn what's working, and prepare for handoff.

Phase 2: Transition Primary Channels (Month 4-6)

Your new hire takes over one channel at a time (usually starting with Facebook). Agency continues to run secondary channels and creative production.

Phase 3: Expand Team and Own Strategy (Month 7-12)

Hire additional team members (Analyst, Creative Producer) and take full ownership of strategy. Agency shifts to creative production partner or new channel testing only.

Phase 4: Full In-House or Hybrid (Month 12+)

Decide whether to fully internalize or maintain agency relationships for creative and new channel work.

Red Flags When Evaluating Agencies

Not all agencies are equal. Watch for:

• No case studies in your category: They'll learn on your budget
• Guarantees of specific CPIs or ROAS: No reputable agency guarantees outcomes
• Opaque reporting: You should have full access to ad accounts and data
• Long-term contracts without performance clauses: Good agencies earn retention through results
• Minimal creative production: If they outsource creative, you're paying a middleman

The 2025 Landscape

Global app install ad spending is projected to reach $94.9 billion in 2025, up 20% from 2023. As competition intensifies, the quality of execution matters more than ever.

What this means:

• Agencies are professionalizing: Top agencies now offer sophisticated attribution modeling, creative testing frameworks, and ML-driven optimization
• In-house teams face higher bars: You need specialists, not generalists, to compete at scale
• Hybrid models are standard: Most apps spending $500K+/month use agencies for creative and new channels while maintaining in-house optimization

Decision Checklist

Before deciding:

• Calculate your total cost of ownership (agency fees vs in-house salaries + benefits + tools + creative)
• Assess your current monthly ad spend and 12-month forecast
• Evaluate whether your channels are in discovery or optimization phase
• Determine if you need creative production support
• Consider your team's current UA expertise level
• Define success criteria and accountability structure

Current Benchmarks

Monthly Ad Spend	Recommended Model	Estimated Total Cost
<$50K	Agency	$60K-$70K/month
$50K-$100K	Agency or Hybrid	$70K-$130K/month
$100K-$200K	Hybrid	$120K-$180K/month
$200K+	Hybrid or In-House	$180K-$300K+/month

Agency Fee Range: 15-25% of ad spend + $5K-$10K minimum retainer

In-House Team Cost (3 people): $300K-$400K/year loaded cost (salary + benefits + tools)

Source: Business of Apps, inBeat, Addict Mobile (2024-2025 data)

FAQs

When should I hire a UA agency instead of building in-house?

Hire an agency when you're spending less than $100,000/month, testing new channels, need immediate expertise, or lack internal creative production capabilities. Agencies are more cost-effective than in-house teams until you reach consistent scale.

How much do UA agencies typically cost?

Most agencies charge 15-25% of ad spend as a management fee, with minimum monthly retainers of $5,000-$10,000. Total cost is often lower than hiring full-time employees when factoring in salaries, benefits, tools, and creative production.

What's the best hybrid approach between agency and in-house?

Many successful apps maintain in-house UA leads for strategy and optimization while using agencies for creative production, new channel testing, and campaign execution. This balances control with specialized expertise.

At what spend level does in-house become more cost-effective than agencies?

Around $100,000-$150,000/month in consistent ad spend, in-house teams become more cost-effective than agencies. At $250,000+/month, the cost advantage of in-house is significant.

How long does it take to transition from agency to in-house?

Plan for 6-12 months for a full transition. Start by hiring a senior UA lead to shadow the agency (Months 1-3), gradually take over primary channels (Months 4-6), expand the team (Months 7-12), then decide on full in-house or hybrid model.

---

The agency vs in-house decision isn't permanent. Start with what makes sense for your current stage, then evolve as you scale. The best teams know when to leverage external expertise and when to build internal capabilities.