Why do the technical people always seem to get the short end of the stick? I have people approaching me on a monthly basis with their 'great idea' and 'all I need is someone to code it', and compensation varies from 'money when it gets big' all the way up to a very enticing 20% equity. After working on a few of these I now ask for cash up front, no equity. I have plenty of my own ideas and not enough time to work on them, tvym.
Technical skills and business acumen aren't necessarily the same thing. Technical people have a tendency to discount the market value of their abilities because they often seem "trivial" once mastered. Also time spent developing technical skills often comes at the cost of developing interpersonal skills that are important at negotiation time (and for detecting BS).
But anyway, my sense is that a lot of these "needs technical co-founder" people have sufficiently poisoned the well that it's getting difficult for them to find bright, bushy tailed nerds still naive enough to accept their terms.
Now if only programmers would demand what they're worth from the game industry..
On the subject of triviality, I've made some discoveries about demoing software to non-programmers. Of course a pretty appearance is very important, but even in just describing features, how hard they were to implement is of zero interest. And what you can sell people on is stuff that is absolutely trivial, or even stuff that is commonplace and every competitor out there does just as well. You feel like you're going to be found out when you brag on the fact that your bike design features a foot activated swing-down ground support to hold it in a vertical position when not in use. But people eat it up.
That's a really good point that I've begun realizing more frequently in my work. People are blown away by most things, and there is almost no correlation between how difficult the problem was and how amazed they are. In fact, I frequently find that the easy stuff tends to impress more (simple UI tweaks, small jQuery animation).
I try to get my highly technical kudos from my technical friends, because my non-technical co-workers begin to glaze over when when I really want to talk about something tricky and fun I did.
Yeah. I think a business founder looking for free tech work has already failed the first test as a businessman: He hasn't been able to raise the $40k-$80k in seed funding needed to build an MVP.
If he can't convince a guy who doles out capital for a living to give him a tiny bit of it, why should he expect a programmer to front him that value in highly skilled labor?
Then they've failed the second test - getting a good programmer who doesn't want to leave.
A programmer on no pay with 10% equity is bound to be look for a new position if the company goes through a rough patch (hint, it will). A programmer with 50% equity will stick it out.
Alright, let's say that business founder gets $60k in seed funding. Would a technical cofounder expect that $60k as salary or towards some specific asset for the company? I don't think that $60k of seed funding is what stands between a businessman with his idea and success.
I would think he would invest the $60k towards things needed to make his idea into a business. For an internet company, software development is going to be a major component, although there are others, like design.
Point is, there are people structured to accept risk. These people include investors and entrepreneurs. There are other people who provide services that businesses need, including designers, lawyers, programmers, etc. These people generally aren't structured to accept risk, they need an hour's pay for an hour's work.
Because programmers can often be confused as to what role they play in a business through fast-talk, there's this notion that has developed that there are lots of programmer/investors available, who are willing and able to accept risk in lieu of payment.
There are clearly programmers who will accept that arrangement at least once due to their naivety, but they they generally learn pretty quickly, and I think it's becoming more common knowledge in the programmer community that it's an arrangement best avoided.
I think the notion of programmer/investors, as you put it, is mostly wishful thinking fueled by a basic lack of experience. Until people get burned, they don't realize that what you can get for $1500 on elance.com will, when it fails, end up costing you more than what you'd get for $15k from a skilled developer. If you flip the equation, you could say it's the clients who are naive until they've actually managed developers a few times and seen what they can expect for their money.
If they do actually know how to handle the business end, then they are in fact valuable, but that is assuming much.
A lot of the "business-side" cofounders you run into in the real world are just glorified "idea men", willing to "generously" cut you in on 5% if you just code up their "Facebook, but for Cats" site they've been thinking about for the past year.
From my own experience for the same reason why architects work with construction engineers. If your business person is actually the pointy haired manager type, well then you're screwed.
But that's not all a busíness founder does. For me, these guys are providing the market, the process knowledge and the knowledge about the needs of certain markets, espacially when the markets are not merely apps for Android and iOS. When your product is aiming at non-tech market, let's say health care, as a programmer you better have a co-founder who knows his trade since in these occasions programmers usually are only the guys crunching through poorly specified code.
Equal footing is the way to go. respect the skills of each other, and at least as important understand the language and the needs of one another. Being able to do X or Y doesn't necessarily make you a better person or founder, you know?
"business person" is very broad. Same as "programmer". In each group there are wide differences in abilities. Certainly if you're good at anything (boating, photography, skiing, programming) you've had people who don't know anything about those things think you are the "expert".
The right business person can be a tremendous benefit. The wrong one can kill your business. Obviously it all depends.
Aside from connections, any partner who can help you get to market faster with $ from real customers is going to be worth it.
Obviously there's a lot of BS "biz" folks. A good barometer is if they have taken the time to learn the skills needed to get their own ideas to market (coding, design, w/e)
