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Is My Approach to Developer Compensation Reasonable?
I've seen threads where devs balked at future potential revenue or ownership based on the risk and fatigue factor since most will already have jobs. The argument followed that the OP was too lazy, and inept, or the concept was too flawed to obtain VC.
I see the merit in those points, but I can't help but think there could be an exception.
I'm not particularly gung-ho about bringing in VC at any point. It's more about control than greed. I realize if the business platform I'm developing gets to a certain size, I may have no choice but to bring in VC anyway. However, I know there are cases where it's been avoided. I would much rather set aside a chunk of profits for a dev pool both for project contributors and when utilizing open source. I envision a larger pool for project contributors. Something like 25% of the total profit. 20% for project contributors and 5% for any open source we use in the core system as an example. I realize that could be a headache to keep track of, but I feel like it's only fair to set aside a portion for the open-source we utilize. I think it would be nice to go beyond just donating and actually quantify and compensate. I also heard that VC's don't like companies where too much is allocated for things like this already, so I would be interested if anyone has an experience with that too in case we do have to go that route eventually.
And yes I think there should be a general profit-sharing pool for all non-dev staff when we get there too. I just had a conversation with a friend working for a startup and they stopped giving ownership after the first of the year so half the staff has it and the other half are just employees with no incentive beyond their paycheck. I think that's moronic and a great way to kill morale.
Just to be clear, I'm a self-taught LAMP programmer who is expanding my horizons into Laravel, REACT, etc. and rapidly expanding my comfort level with Ubuntu on Windows. I've been spoiled with WHM and cPanel knowing just enough vi commands to get by, but now I'm making a point to fill in all the gaps in my knowledge. I've got a long way to go, but I'm learning a lot daily. I only point this out in case I'm using incorrect terminology anywhere in this thread. Feel free to correct me in any and all aspects. I'm eager to learn!
And I am completely familiar with the reality that most startups fail. That's why I'm trying to ensure we have multiple revenue streams on the platform. One of which would be developers leasing or selling their custom modules to end users outside of the core system. The platform takes a reasonable commission and the devs get their code exposed to another marketplace. I would like it to support the freemium model too so devs can offer a teaser or sample version and then upsell them like WP modules for example. There's a lot more to all of this and why we will be differentiated from what's out there already, but it's not relevant to this discussion and I don't think any of you want to hear my pitch. ;)
There are several other revenue-generating ideas I envision too, but I think you get the point. No matter what, there's a risk for a developer if we don't pull it off. Am I crazy to think I can make this approach work? Even with conventional thinking, I feel like there's still something to this. Thoughts?
Thank you in advance!
- smt88 4y agoGive devs cash. If you can't do that, you don't have a software startup. You may find young, naive devs who work for 0% cash, but they won't be good and you won't get anywhere.
- altdev 4y agoI get your point. I assume you mean full-time versus contract work? I realize there's an inherent security risk in contractors, but without VC full-time devs would not be realistic. Again, I'm trying to avoid the VC route. And thank you for your feedback!