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  1. #1
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    clients with no cash but potentially lucrative sites

    Not sure if this is the right sub-forum for this topic but it's the closest I've found.

    I'm 3-months into my career as a freelance developer, and so far I've had small but successful projects with 3 clients. One of them has a pretty nifty idea for a site, and is already getting a good amount of traffic, but he has no more cash to invest in the site (that is, to pay me).

    I think he could actually make some money off his site if he invested in more development. I was thinking of instead of paying me a set fee, he could give me a certain % of any revenue the site makes over some period in return for me working on his site, basically doing what needs to be done to make it profitable. For example, I'd work on it for a month, in April it would start to generate income, and he would pay me 15% (for example) of the revenues monthly for the next 6 months.

    In my view this is a win-win as he only pays me if he makes money, and he knows I will put in my best effort as I have alot at stake as well. Upside for me is potential passive income for the next few months once the initial work is done.

    Has anyone tried this? Is it common? Any potential pitfalls I should be aware of? Also, I don't have a good idea of what a reasonable % would be to ask of him. If anyone has tried this I'd love to hear some feedback.

    Thanks,

    Helo

  2. #2
    SitePoint Wizard silver trophy
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    What you're talking about is common but almost always criticized here. The simple reason why this isn't recommended is because your part of the process while important is small. Measuring up to sales when you only control the site often results in frustration and disappointment when other pieces fall apart.

    Should you chose to walk down this path be very frank about your role, your commitments and theirs. While you're sharing in the profits you can't do all the work and not everything is free. If they ask you to go outside a set scope there has to be a cost and that has to be known. By the same token if they fail to do certain things that will increase or decrease sales (like having product, running promos, being in business all together) there must be real world penalties. No agreement will ever be perfect or compensate if things fail entirely but without something well thought out you're asking to be exploited.
    - Ted S

  3. #3
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    Thumbs up

    Suggest that they invest more in development. There are a lot of affordable technology providers out there. As for your participation, just make sure you lay everything out in clear terms. This is so you don't get taken advantage of, especially when the site does take off and earn money.

  4. #4
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    i agree, im new to online buis but buis is buis in some cases, if he cant pay you directly the like stated clearly state what you want in compensation and get it in writing so he doesnt flake out on you after agree to the terms or since its new..see about posible partnership(that keeps some money in your pocket) in the long run, might be less than the upfront costyou charge for what he needs but moderate money for a year is better that good money for a week. doesnt have to be 50/50 but you can be his personal "go to guy" for a fee which can come out of his sites/biusness profits. like paying ifor nsurance throguh your job... just a thought


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