How to find a client that would pay for your development in exchange for a license?

It takes an investor with a special kind of appetite to invest in software. And in my research, I have found that there are very few with that type of interest. I have a business model for an internet marketing platform. How can I find a client that would pay for my development costs of the service in exchange for a license?

The model of the partner takes all the risk and pays all the money, whereas you get paid for development time, take no risk and take all the reward for selling the licenses is simply wrong, there is no way around this conclusion.

You must perform at least some part of the initial development at your own cost. At that point, you could try to pre-sell beta licenses to a number of customers to cover the next step of the costs. But your initial investment must be significant in order for customers to have something to see.

If I was a client and had that money I'd just use it to build the software myself, give myself a free licence to my software, and recover that money by selling licences when the software is ready. What you're proposing doesnt make any sense

I've actually done this. More than once. We had ideas that we wanted to build as B2B SaaS/PaaS solutions and expanded to a good concepts. We didn't want to bring in external investment. We found a niche market, and made a list of target clients.

We went to those clients and spent time understanding their problems, until we were sure we knew them better than the client did. Free consulting if you like. Then we pitched our solution to them, in their context, with their real numbers attached to it.

Not only did the client(s) pay for the up front development cost, they took out a paid contract for using the platform ongoing.

With a good contract, and sensible billing against milestones, the risk for the client is actually quite low.

There's a couple of caveats:
We have a lot of experience in solving problems in large companies.
We knew what we were talking about in terms of our product.
We invested our time and experience into the client.
We knew how to make a compelling sale.
We are likeable people.
We have balls of steel.

If you're unable to fulfil these sort of criteria, you've got a very slim chance of pulling it off.

If I understand your question correctly, what you're asking is to find a client who will pay your costs for you to develop an internet marketing platform. In exchange, you will give them a license to use the software.

Disadvantages for your potential business partner:

• Your technology is unproven and they don't know whether or how fast you will be able to get it to work. By contrast, they could take the money they would pay you and buy an existing marketing platform.
• Paying for your development means to pay for you to do all the work to handle initial bugs, etc. This can be very expensive.
• After they pay for debugging, you are going to turn around and sell the product to other companies. This will be pure profit for you and your original "investor" will get nothing in return other than a license.

I certainly wouldn't take such an offer myself.

You should find a partner that offers more than just paying for development costs. Others have stated there is nothing in it for the business owner, but I disagree. First, they shouldn't expect to pay the same amout as they would for a custom application. They're getting in on the ground floor and can have a strong influence on getting the features and functionality they need.

Second, don't expect them to directly compensate you for the cost of building the app, but work with someone who is connected in their industry and can attract other buyers. Again, you're offering to let them get involved in the project from the beginning, so they can have a lot of input into the app. You can also offer a referal agreement that could potentially allow them to gain their initial investment back.

You may want to find independent business owners who want to turn their business into a franchise or create dealership program. They're going to need an app on a much broader scale along with ways to aggregate all their dealers/franchisees. The members can pay the software license. This approach may delay your payment, but builds a strong relationship and revenue stream in the long run.