I was writing about my own startup companies, then found Ryan Carson’s post on “building his web applications”.
Here is the part of the post I found particularly interesting, the contract:
Elliott [the developer] will receive 10% of monthly revenues, after the expenses listed above. If he launches the site on time (3pm April 20th), this will increase to 15% (hat tip to Natasha on that idea). When the site hits $25,000 monthly revenue (excluding VAT), his take will increase to 25%.
His monthly cheque will be determined by a snapshot of the revenue on the 1st of every month at 9am.
If the app is sold, Elliott will receive 10% of the cash price, after lawyer and accountancy costs.
I build web applications so I can relate to Elliott here as well as many of you (my readers). The only difference between me and Elliottis that I own the company who knows all the people to hire and how to get it done. My company is called,“MJG International”and establishes these type of business partnerships.
Before I rip apart the Carsonified contract, I want to say quick - Ryan Carson, if you are reading this thank you for sharing the information, it serves as a good example to work from. And certainly I am not accusing you of being dishonest - I just don’t agree with the contract.
Now here is my opinion on the Carsonified-Elliot contract. I’m not sure why Elliott would build the product for no money and 10-25% of the application under certain performance terms. I think this is a really bad contract completely in the favor of Carsonified. Here is why it sucks for Elliott:
Wow, talk about getting kicked in the butt by a contract. Carsonified gets all the cheese for having the idea and negotiating the contract. Good work negotiating, Carsonified!
Now I’d like to share with you how I negotiate a contract. When I say,“you”here that means you as the developer. Assuming you want to go on these ventures.
That is all off the top of my head. Because I’ve been through this I feel it is my duty to protect the on-the-ground workers who can actually finish products. Once I get good at executing and have a lot of successes under my belt, I’ll probably take more like 70% of the product instead of 30%, since the only thing the company partnering with you is doing is have the initial idea, which is important - but everybody has ideas! Execution of the idea means a lot, especially in web development.
Let me assure you that I value the business partnerships I make and their ideas. The contracts I’ve made so far have been fair and everyone has been great to work with! I hope you all reading this can have the same.
Be fair, don’t be square. You rock, peace all.