Revenue share for a mobile app with an (almost) guaranted success


0

I have a customer who wants to pay me by sharing the revenues. He already has a good user base on his PC software version, and we both know that a mobile app should sell quite well (let's say $100K/yr). So, my only job would be to port his current software to a mobile app.

But I have absolutely no idea what percentage should I ask for.

Also, what about the development costs? Should I ask him to pay all of them?

I guess it's not so easy to answer, but I would like to get a rough idea to not ask for too low or too high (I really don't know what a realistic value would be : 10%, 40%, 70%?). What factors are important to choose the correct amount?

Software Revenue Mobile Apps

asked Jun 10 '13 at 09:35
Blank
Dalmas
103 points
Top agency to build award-winning mobile apps: Utility NYC

1 Answer


1

This is what I would do (I am also a developer).

First off, I would decide how much time I would be putting into the project myself. If the port is going to take around 3 months, I would calculate 3 months worth of work and reference it back to revenue sharing percentages. You can do this by using the evaluation of 100k/yr you claim to be making.

At the same time though, I'm sure your "partner" has put a lot of work into the PC version being the success that it currently is, so you want to give him the upper hand in terms of equity, as it is his project to begin with.

Personally, I think you should ask for around 10-25% of the company if you're putting in around 3 months worth of work or so. 100k/yr is a pretty good starting point and hopefully it will get you to a point where you can expand the product even further to making 200k/yr, etc.

It all comes down to this really:

While you're building the mobile product now, what happens afterwards? How many hours is he going to put in on the business development side, etc. Basically, all the backend factors that developers really don't think about as they are building the product. Plus, I'm sure he's going to be helping you with ideas, planning, etc. along the way which is a huge aspect when getting involved ina company as a developer. You don't want to be building the whole product yourself.

If he's going to work hard after the app is developed, I think 10-25% is fine for your work.

Hope you understand what I'm saying here. It's kinda late :)

Best of luck.

answered Jun 10 '13 at 12:48
Blank
Asg
53 points

Your Answer

  • Bold
  • Italic
  • • Bullets
  • 1. Numbers
  • Quote
Not the answer you're looking for? Ask your own question or browse other questions in these topics:

Software Revenue Mobile Apps