Danielle, I would expect you would get many different opinions on this depending on how the person answering has been burned. Many will tell you that you must have an internal person because they will not run off, however, I have known many startups where the CTO left because they got tired of not getting paid or their full time job got in the way of their putting in much time on the startup.
The real issue is finding someone with the correct level of integrity and software development skills that you can trust. If the developer is not experienced with what you are trying to accomplish, your odds of success are slimmer as they will be making mistakes that may limit your chance of success. Look at their experience both with developing software and with understanding how business works. Make sure they can communicate well with you and can understand what you are asking for. Above all, verify their experience and talk to some people they have worked with in the past.
Just because someone is not an "Employee" does not automatically mean that they will not stay with you for a long time. I have clients I have worked with for 20 years and although I am not their employee, they know they will be able to get hold of me on the phone. I am sure there are lot's of other developers like that.
Also note that there are software development companies like mine that will take an equity or royalty stake in lieu of all cash for the development of the project. Companies like that, similar to an employee with stock, have a vested interest in seeing you succeed. Since they have had experience developing and possibly marketing other products, they can probably offer good advice in addition to the development.
Feel free to message me if you would like to have a more in depth discussion based on your specific needs.