Buy vs Build Your Own LMS: How to Make the Right Decision in 2025?

Are you considering whether to build your own LMS or buy one?

This comprehensive guide will help you make the right decision by exploring the benefits and challenges of each approach. Whether you're leaning towards custom development or purchasing a ready-made solution, we've got you covered.

What we will explore together:

• When considering building an LMS from scratch, you have full control and ownership, allowing for complete customization. You also avoid dealing with contracts and dependency on an LMS provider. However, developing your own LMS can be time-consuming and expensive, with costs ranging from $70,000 to $400,000, alongside ongoing maintenance and updates.
• Meanwhile, buying an LMS is a popular choice for virtual academies and organizations due to its quick implementation and cost efficiency. LMS support, maintenance, and upgrades are typically included in the package. The main drawback is dependency on the provider, and customization options may vary depending on your chosen LMS.
• Disco, a next-gen LMS with extensive customization options, offers a top-notch solution to your dilemma. Its flexible learning platform and customizable pricing allow you to create a branded academy and learning organization.

Building your own LMS offers the advantage of complete customization, allowing you to tailor the system to your specific needs. However, this option can be time-consuming and costly.

On the other hand, buying an LMS can save time and resources, providing a ready-made solution with ongoing support and updates. In this article, we'll explore the benefits and challenges of both building and buying an LMS. 

We'll also share a case study of a learning organization to help you better understand the practical implications of each choice.

What is a learning management system (LMS)?

A learning management system (LMS) is a powerful software application designed to streamline the creation, management, and delivery of educational content and courses.

It serves as a centralized platform where educators can develop and share courses, track student progress, and evaluate performance. An LMS is indispensable for educational institutions, businesses, and organizations aiming to provide high-quality online learning experiences.

By leveraging an LMS, organizations can streamline the learning process, making it more efficient and accessible for learners.

Types of learning management systems

Learning Management Systems come in various forms, each catering to different needs and preferences. Here are the primary types:

• Open-source LMS: These systems are free to use and modify, offering a high degree of customization. They are ideal for organizations with technical expertise and a desire for flexibility.
• Proprietary LMS: These are commercial products that require a license or subscription. They often come with dedicated support and regular updates, making them a reliable choice for many organizations.
• Self-hosted LMS: Installed and maintained on the organization’s own servers, these systems provide complete control over data and customization but require significant IT resources.
• SaaS LMS: Cloud-based and provided as a service by the vendor, these systems are easy to deploy and maintain, with the vendor handling updates and security.
• Integrated LMS: Designed to work seamlessly with other applications and systems, these LMSs enhance functionality by integrating with tools like student information systems and learning analytics platforms.
• Non-integrated LMS: Standalone systems that do not integrate with other applications, suitable for organizations looking for a simple, self-contained solution.

Understanding these types helps organizations choose the LMS that best fits their needs and technical capabilities.

When should you consider buying or building your own LMS?

Let’s say your team is expanding, and it’s time to elevate your training programs by consolidating your internal content in one place.

Or perhaps your virtual academy, which started from scratch, now boasts 100 students/alumni, and it’s time to scale up with a learning platform.

So, which option should you choose: building your own LMS or buying one?

The answer depends on your current situation.

Organizations with sufficient resources, such as a budget for building and maintaining software, ample time to wait for their LMS to be developed, and a tech team (either in-house or freelancers), are better off considering building their own custom learning management systems.

This option provides complete control and the ability to tailor the system precisely to your specific requirements.

In addition, if your organization has unique needs that off-the-shelf solutions cannot meet, building your own LMS allows for full customization to create a bespoke learning experience that aligns perfectly with your goals and preferences.

Conversely, if you are an organization or a virtual academy without these resources, the best choice is to buy a ready-made LMS. This allows you to start creating and monetizing your courses and training programs immediately.

Ready-made LMS platforms come with built-in features, ongoing support, and regular updates, enabling you to focus on delivering quality content without the hassle of technical development.

Making an informed decision requires understanding the pros and cons of each option. So let’s dive in and explore the benefits and challenges of both building and buying an LMS.

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Building your own LMS

Building your own LMS offers organizations complete control over their learning platforms. 

However, the management system development process involves significant time commitments, with development taking 400 to 500 hours. The costs for a development team, designers, and project managers can be substantial.

Thus, weighing the advantages against potential drawbacks is essential to determine if a custom LMS fits your organization.

Advantages of custom learning management system development

1. Full control and ownership

One of the primary advantages of custom LMS development is the ability to maintain proprietary ownership.

This means you have full control over your learning platform, from its features and design to the content it delivers. A custom LMS can be tailored to include only the specific tools and functionalities your organization requires, avoiding the clutter of unnecessary features.

This tailored approach can significantly enhance the user experience, making the platform more intuitive and aligned with your training objectives.

2. Full customization

A custom LMS allows for greater adaptability and branding opportunities. You can design the platform to reflect your organization’s unique identity, creating a cohesive and branded learning experience.

Unlike third-party platforms, a custom LMS provides the freedom to innovate and evolve without being constrained by vendor limitations or contracts.

3. No contracts

By building your own LMS, you are not bound to any contracts or subscription plans.

You are free to continue or discontinue the development of your learning platform depending on the performance of your learning business. This flexibility allows you to adapt to changing needs and priorities without the constraints of vendor agreements.

Additionally, it ensures that you retain full control over updates and modifications, aligning the platform’s evolution with your organizational goals.

Disadvantages of building your own LMS

Building your own LMS can lead to substantial upfront costs, prolonged development time, and the necessity for continuous maintenance and updates

These factors may outweigh the perceived benefits of customization. Actually, the effect of building an LMS on organizations is enormous.

Any organization that writes its own code experiences technical debt, and that means businesses end up spending all their allocated resources just keeping the tech operational. Developing and deploying new features becomes impossible.

1. Time-consuming

The development process can be lengthy, potentially taking up to a year or more, delaying the implementation of your training programs and impacting your overall strategy.

2. High upfront cost

The upfront costs are significant, requiring a team of developers, designers, and project managers. These costs can escalate quickly, making it a substantial financial investment.

3. Ongoing maintenance and updates

Maintenance is another critical consideration. A self-built LMS requires ongoing maintenance to remain functional and up-to-date.

Unlike cloud-based systems with automatic updates, custom LMS platforms depend on manual updates by the administrator, increasing the workload. The complexity of maintenance can also be affected by the number of functions and modules in the system.

Learning management system development: Key considerations

Developing a Learning Management System involves several critical considerations to ensure it meets the needs of users and provides a high-quality online learning experience.

Here are the key factors to keep in mind:

• User management: The system should efficiently manage user accounts, roles, and permissions, ensuring that administrators can easily control access and maintain security.
• Learning materials: A successful learning management system must support a variety of learning materials, including text, images, videos, and quizzes, to cater to different learning styles.
• Course creation: The LMS should enable educators to create and manage courses effortlessly, including setting up course structures, adding learning materials, and assigning assessments.
• Assessment and evaluation: The system should provide robust tools for assessing student performance and offering feedback, helping learners understand their progress and areas for improvement.
• Reporting and analytics: Detailed reports and analytics on student performance and progress are essential for educators to track effectiveness and make data-driven decisions.
• Integration: The ability to integrate with other applications and systems, such as student information systems and learning analytics platforms, enhances the LMS’s functionality and user experience.
• Security: Protecting user data and learning materials is paramount. The LMS should have strong security measures in place to safeguard sensitive information.
• Scalability: As the user base grows, the system should be able to scale accordingly, ensuring consistent performance and reliability.
• Customization: The LMS should be customizable to meet the specific needs of the organization, allowing for a tailored learning experience that aligns with organizational goals.

By carefully considering these factors, organizations can develop a successful learning management system that supports their educational objectives and provides a seamless learning experience for users.

Cost analysis of building a custom LMS

Building a custom LMS involves significant initial and ongoing costs.

The total labor costs associated with LMS development can range from $70,000 to $400,000, depending on the complexity of the project. Additional technology and infrastructure costs can further increase the financial investment required.

Ongoing maintenance expenses can also accumulate over time, with annual maintenance costs ranging from $5,000 to $50,000. These costs include regular updates, technical support, and any additional features or modules added to the system.

When deciding whether to build or buy an LMS, both the initial and long-term costs must be considered.

So let's take a look at the benefits and limitations of the other option...

Buying an LMS

Since buying an LMS is a popular option, there are thousands of learning management systems available for every type of learning program.

If you are looking for an LMS that supports course creation, internal training programs, and events management, you can consider Disco, the next generation of LMS, a modern and AI-powered learning platform that works well for virtual academies, corporate training, internal training, and workforce upskilling.

Unlike traditional LMS platforms, Disco offers advanced functionality, going beyond what a typical LMS can achieve. Organizations can build their modern academy with Disco with no technical skills or specialized team.

The platform provides the flexibility to create unique, transformative learning experiences that traditional LMS platforms simply can’t match.‍

Advantages of buying an LMS

1. Immediate availability

When you buy an LMS, you can start using it right away.

This means you can quickly experiment and build your learning programs without the long hours, days, or even months of work with tech teams or consultants required to develop a custom LMS. By buying an LMS, you can literally create and publish your programs and training in a day!

2. Resource efficiency

Building an LMS requires significant resources, such as money, time, and people. Not every organization has the capacity to provide all these resources simultaneously.

Buying an LMS reduces this burden, as you only need a budget for the subscription fee, which ranges from $100 to $5,000 depending on the type of plan and features you need.

🪩 Disco, the next-gen LMS, offers an organizational plan and custom pricing for mid to large enterprises. If you want to get a custom quote for your organization, book a live demo with the Disco team for a free consultation and custom quote based on your needs.

3. Customization options

You might think that buying an LMS limits your ability to customize your learning management system.

However, modern LMSs allow for deep customization options to brand the platform with your own identity, including colors, images, appearances, and labels. Although not every LMS offers high customization, using a customizable LMS like Disco ensures you can tailor the software to your brand.

4. Maintenance and upgrades included

Unlike developing your software, buying an LMS frees you from maintenance and upgrade responsibilities.

Ongoing maintenance and upgrades in features and functionalities are already included in what you pay the LMS provider. Although some LMSs offer licensing options for some of their features, you generally do not need to worry about maintenance for other functionalities.

5. Included support and training

As a customer, you play an integral role in helping LMS providers improve their products and services. Therefore, most LMSs offer free customer support and training.

Top-rated LMSs like Disco provide customer education in the Disco Academy where you can join for free to receive product updates and interact with other members.

Disadvantages of having a ready-made LMS

1. Dependency on the provider

When you buy an LMS, you become dependent on the provider.

Unlike building your own LMS, where you have complete independence, subscribing to an LMS means you are bound by the provider's terms and conditions, which can sometimes limit your flexibility.

2. Potential licensing costs

Some LMSs offer licensing options for certain functionalities, which can add to the overall cost for organizations. It is important to consider these potential additional expenses when evaluating an LMS.

Case Study: How A.CRE transforms its training programs with Disco’s next-gen LMS

If you think you're the only one who is experiencing this dilemma, you are not alone.

Other organizations, mid-to-large ones have also undergone this journey, and here's a story from A.CRE on how they decided to buy an LMS rather than build their own.

Adventures in Commercial Real Estate (A.CRE), renowned for its industry-leading training programs, once undertook the ambitious journey of building its own LMS from the ground up.

However, as they grew, the limitations of maintaining a custom-built system became clear—it was costly, time-consuming, and lacked the scalability they needed to support their expanding training programs. Therefore, A.CRE chose Disco, the next-gen platform they had hoped to build for themselves. 

With Disco, A.CRE found an intuitive, all-in-one learning platform that met all their needs without the expense and complexity of custom development. Confident in Disco’s alignment with their vision, A.CRE seamlessly transitioned from their custom-built app.

Now, instead of focusing on software development, the A.CRE team can devote their energy entirely to growing their learning business.

The move has resulted in significant cost savings, countless hours reclaimed, and resources reallocated to enhance and expand the learning experience for their members.

Wrapping Up...

The decision to build or buy an LMS depends on various factors, including cost, customization needs, and long-term maintenance requirements.

Building a custom LMS offers unparalleled flexibility and control, allowing organizations to create a tailored learning experience that aligns with their specific goals. However, it also involves significant initial and ongoing costs, as well as extensive development time.

Buying an off-the-shelf LMS provides a quicker and more cost-effective solution, with access to quality-tested features and expert support.

Ultimately, the choice between building and buying an LMS should be guided by a comprehensive understanding of your organization’s needs and resources. By carefully weighing the pros and cons of each option, you can make an informed decision that best supports your training and development objectives.

DISCO: An ultra-modern, AI-powered, and customizable LMS in 2025

If you have chosen the path of buying an LMS, consider placing Disco at the top of your list. Among the thousands of available LMSs, Disco stands out due to its ultra-modern interface, intuitive design, and advanced functionalities essential for thriving in this AI-driven era.

The Disco platform is trusted by renowned organizations such as CourseHero, Kaplan, A.CRE, Toronto Board of Trade, AllWomen, YSpace, the PORCH community, and many more. Disco has earned accolades, including being recognized as the Most Innovative Company in Education by Fast Company.

Disco is a versatile and flexible software solution designed for L&D programs and virtual academies. With Disco, you can create and publish your training programs in just a day or less using its ready-made platform.

You can even try it without any upfront cost. Disco offers a 14-day free trial, allowing you to evaluate if it is the right choice for your organization. Experience the benefits of Disco by trying it out or speaking with our customer representative. Book a demo to get a custom quotation and address any questions you may have.

Frequently Asked Questions (FAQs)

How long does it typically take to build a custom LMS?

Typically, building your own learning management system can take a year or more. This is influenced by the project's complexity and available resources. The timeline underscores the importance of thorough planning and resource allocation in the development process.

What are the cost considerations for building versus buying an LMS?

The cost considerations indicate that purchasing an online learning management system is often more cost-effective and faster to implement compared to building one, which entails substantial initial and ongoing expenses for labor and maintenance. Therefore, for most organizations, buying an LMS presents a more advantageous financial choice.

When should an organization consider building a custom LMS?

An organization should consider building a custom LMS when it has specific training requirements that off-the-shelf solutions cannot fulfill, or when it seeks significant customization and ownership of the platform.