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Pramod,
before even exploring the modalities of taking equity in your client, have you asked why they want you to take equity? it might be that they are unable to pay your dveelopment costs and hence are proposing this route.
if they are offering equity in lieu of paying your development costs you need to work out how viable an entity are they.
Categories: Jobs and Partners Board
We are a Chennai based company. We specilize in providing programming services to clients in USA and Europe. Recently we have been building a Reverse Mortgage CRM product for a US based client. Our US based client has given us the specs for the application and a proprietary way of qualifying a lead. We are ONLY programming the SAAS application for the client. This client is now asking us if we would like to partner with them in their company. What should we expect in such a partnership ?
How much should we expect ?
Equity in the company
Our Development Costs
Suppose they renege on a contract, what are the options we have ? Should we have a US based lawyer to fix the contract ?
Generally how would you qualify and trust a partner in another country.
regards,
December 30, 2008 10:03 AM
December 30, 2008 3:10 PM
As you say, you're in the sw development business, so unless the "partnership" is framed in those terms, its not going to be beneficial for you. If you perhaps had the means to resell the software (to whomever you want), it may be interesting, but that is extremely risky, given you are based in India, it would be very, very hard.
Usually, when I see this type of language coming from a prospective client, I think: they've got no money. Why on earth would they want to give up equity to pay for a software app? Very concerning.
Compound that by the fact you are in two different continents, I kind of wonder if this is going to be good business situation for you in any type of "partnership". Stick to perhaps what is comfortable to you ... developing a solution on time and budget. Let them absorb the risk ... especially with the volatility in the real estate market at the moment.
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Robert Dubicki
January 3, 2009 3:06 AM
Yes, on a rethink the partnership does not seem like that good an idea. The business is in the customers and the design of the software. The software app and the programming is like you said just one small part of a business (mortgage) we do not know anything about. The way they qualify a lead itself is so specific to their industry.
And right now we don't have the knowledge or resources to get into some other business other than software development.
thanks,
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