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Why Developers don’t do Unfunded Joint Ventures

Every so often a client with a great idea offers me a joint venture. And it often is a great idea – but unless they are funded (have already raised financial backing on the basis of their idea), I almost always say “no”.

The reason is the balance of risk and effort.

With an unfunded joint venture, everyone is committing to give their time and money to a project on an unpaid basis. But the timing of the effort is very different for say the developer compared to the marketing expert.

With an unfunded project, the developer has to commit their effort first – they have to develop the product, which the other team members are committed to market. For the developer, this represents a serious risk – they could sink hundreds, maybe thousands of hours of their own unfunded time into a product, just to see the other members of the team give up and walk at the first obstacle.

At least half, maybe more than half, of the effort of launching a successful product, is skilful marketing and promotion of the product.

Why is a funded venture different? The reason is, if a joint venture has funding at the time the partners approach a software developer, then either the marketing people have already done a great deal of work, promoting their idea, or, if the idea is funded out of their own pockets, other team members have committed the time and effort it took for them to earn the money they put up as funding.

And there is no reason why a project shouldn’t be funded. Fund raising has never been easier – for example, Kickstarter invites people to contribute funding for very little in return, other than seeing the idea come to fruition. Browse through the projects, and you will see the most unlikely ideas funded with large contributions – but who am I to judge?

If you have a great idea for a joint venture, I’m happy to discuss it – you can always contact me at eric@desirableapps.com. But please don’t be offended if my initial answer is no – because if you are willing to work with me, I will do my best to help you find a way to turn your idea into a product.

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