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Sales people get paid largely on commission for "transactions" ... it should be possible for open or closed source software developers to be paid this way as we
by nwatson 9y ago
Sales people get paid largely on commission for "transactions" ... it should be possible for open or closed source software developers to be paid this way as well.
There should be an option that pays open- (or closed-) source software developers for business value derived, where metrics (representing aspects of "remunerable transactions") from developed software use are gathered, and the company using the software pays based on some formula related to those metrics. The classic way to do this of course is to provide the software via some metered and billed SaaS API (users pay monthly base + tiered charges per network I/O, storage, CPU-hour, document-processed, etc., or a combination thereof), but that can have adverse performance impacts and can introduce larger integration headaches.
In an ideal setup, the "contractor" adapting and deploying the open- (or closed-) source software for a particular company's use also gets a cut of the fees, just like the originators of the software.
This structure would be ideal for smaller companies that can't afford or might not want to pay the full up-front cost for the development and/or configuration and/or deployment of software they need ...
* these companies don't have a lot of money to spend, but independent developers might be willing to develop (permanently- or temporarily-)closed-source software for the companies' use cases ... and to get their compensation based mostly on a "commission structure"
* the company needs might be already satisfied by existing open-source software, but the company may not have expertise in configuring, adapting, and deploying the software -- in this case the deploying expert would hopefully share their fees with the open source software originators
* agreements could sunset the "acquiring" company's exclusive use of this software so the developers can start selling the software elsewhere as closed- or open-source software
There are surely many complications to a model like this, and perhaps can easily work only in a "high-trust" environment ... but it lets developers with a tolerance for risk avoid the illiquid equity trap of stock compensation, while letting companies build their service for less and issue less stock. There are surely scenarios where this would be attractive to larger companies as well.
I'm currently exploring starting a company that incorporates these concepts, I'd appreciate some discussion if this interests you. (You can find instructions to derive my email address from my profile.)
EDITS: minor clarifications
- dboreham 9y agoI think you're vastly underestimating the difficulty getting people to pay for stuff, especially stuff they can get for free.