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I'm not a developer but I've managed to lasso a few guys together through equity-based compensation on the profit from sales of version 1-1.x. At version 2, ter

by pxlpshr 18y ago

I'm not a developer but I've managed to lasso a few guys together through equity-based compensation on the profit from sales of version 1-1.x. At version 2, terms are open for renegotiation by either party. This clause is to protect myself in the event we need to raise money for aggressive features, or the developer's interest begins to taper. There are other clauses in place if the developer doesn't want to support the app, but that's getting into details. I'd rather keep my partners around because of the trust we've established. What's good for them is good for me, especially if they can quit their day job off the sales of our products. Version 2 features are going to take a lot of hard work. I really don't have any interest in paying developers cash because to maintain a competitive app in the store, you can't just build it once and put it out there. For some apps, that may work... but if you're trying to build a lasting mobile app company, you have to stand behind your product(s), add features, and continuously improve... I wish I had the money to pay these guys for their full-time attention, month after month... but I don't so the only way to get that is to share the success. It's not easy finding partners this way, especially with the markets taking a dump... What I did that I believe helped was in the presentation of the idea to the developers. I'm the designer, so I was able to mock up very solid prototypes for them to get a better understanding of what I was looking to accomplish.

jhancock 18y ago
It sounds like you've put together a balanced compensation structure. Is it possible for you to publish at least an outline of this? I think many of us struggle with coming up with meaningful equity arrangements for small and un-funded projects.
- pxlpshr 18y ago
  Sorry for late response - holiday weekend. I'm trying to setup the company very loosely to attract entrepreneurial developers. We have plain-english contracts in Google Docs that we jointly edit until we're both satisfied. Since I've been responsible for all of our current product ideas, I'm entitled to a majority of the profit (usually 60%) but it's negotiated on a per-project basis. For example, one of our app's has a "web service" integrated into it hoping we can monetize on ads on backside traffic. Per $1 we decrease that products price, he gets an additional 10% of the ad revenue on said website. That said, I think you need to handle each product and developer on a case-by-case basis. As long as the developer adequately stands behind the product with support and feature-add, then they get to keep their share. If they are not interested in supporting, adding features, or localizing the app for other countries -- then their profit decreases ~20% per additional developer required. I also extend each developer the ability to publish through our company account on their own terms if they have an idea. Whether or not our company directly promotes their product(s) is up to me (and them). Feel free to contact me if you have any additional questions.

by pxlpshr 18y ago

jhancock 18y ago

It sounds like you've put together a balanced compensation structure. Is it possible for you to publish at least an outline of this? I think many of us struggle with coming up with meaningful equity arrangements for small and un-funded projects.

pxlpshr 18y ago
Sorry for late response - holiday weekend. I'm trying to setup the company very loosely to attract entrepreneurial developers. We have plain-english contracts in Google Docs that we jointly edit until we're both satisfied. Since I've been responsible for all of our current product ideas, I'm entitled to a majority of the profit (usually 60%) but it's negotiated on a per-project basis. For example, one of our app's has a "web service" integrated into it hoping we can monetize on ads on backside traffic. Per $1 we decrease that products price, he gets an additional 10% of the ad revenue on said website. That said, I think you need to handle each product and developer on a case-by-case basis. As long as the developer adequately stands behind the product with support and feature-add, then they get to keep their share. If they are not interested in supporting, adding features, or localizing the app for other countries -- then their profit decreases ~20% per additional developer required. I also extend each developer the ability to publish through our company account on their own terms if they have an idea. Whether or not our company directly promotes their product(s) is up to me (and them). Feel free to contact me if you have any additional questions.