6 Stories - How New Software Products Get Built

Team, scope, and budget are the biggest factors impacting your software project. Our goal is to help you understand the landscape so you can make the best choice for how to build the software that will supercharge your venture.

Team

Who is going to build your software?


Getting your team in place is the most critical piece in the software-building puzzle. In terms of functions or roles, the team should at least consist of design, architecture, frontend, backend, mobile, DevOps, and product management. Depending on the complexity and focus of your application, you may need to bring in team members with expertise in data science, artificial intelligence, or another specialized field.


Salaries and rates for these individuals vary wildly. Assembling a team is a balancing act between expertise and costs.



Scope

What do you want your software to do?


You have a choice to make. With the right tools and taking the right shortcuts, you could hire a student to build your solution in a weekend. They may even be able to 'demo' your concept. However, is that really what you want?


Alternatively, you could hire a team to spend a year building your solution, as startups do when they raise a $10M funding round. This full-fledged team may be able to create a sophisticated application that can withstand a large consumer base. But, is this overkill for your venture?


Budget

How much do you want to spend?

With all these variations in the market, the question becomes what kind of software you can build within your budget. Quality costs money, but there are many ways to prioritize value and be more efficient with your budget.



Your Options


1 - DIY


A founder builds their own product.


Pros

  • It's easier to fundraise when you have a product

  • You won't spend much money (although it does cost time)

  • You get to bring your vision to life.


Cons

  • You are alone.

  • It can take years to learn to code and build your prototype.

  • You don't know what you don't know.


Our Advice


Try to do this. If you find it easy, go for it. If you find it hard, the opportunity cost of your time might not be worth the cost-savings. A founder builds their own product.



2 - The sweat equity tech co-founder


A founder finds a technical co-founder who has the financial stability to forego a salary and partners with them. The offer can be 30%+ of their company in exchange of them building the product.


Pros

  • It's easier to fundraise with a Computer Science grad on the deck.

  • It costs you less upfront.

  • You are no longer alone.


Cons

  • Sharing your company means sharing your vision.

  • People with these skills are scarce.

  • Tech experience does not automatically come with business experience.

  • You are in a race against the clock.

  • No-cash deals are not sustainable, even for the most financially independent people, because of their opportunity cost.


Our Advice


If you go down this path, make sure you are realistic about expectations. Be honest with yourself and your partner about commitments, and have a four-year plan. Unfortunately, it's common to see things taking longer than planned, which end in co-founder breakups.


If you want to know whether looking for a tech co-founder is right for you, check out this video by Michael Seibel. If what he says matches the reality of your network and situation, then follow his advice. Otherwise, we suggest you do things differently.


If you're considering going solo, you're in good company. Check out this Wharton research paper backing up your choice. Many investors still have a hard time with solo founders, so ask yourself this question: is it more important to you that you can raise funds easily, or is optimizing for sustainability, longevity, and revenue a greater priority? If you rank sustainability higher, this list of investors might be a good place to start.



3 - The dev shop abroad


A founder spends as little as $5-20k on the developers who offer the lowest bid.


Pros

  • Relatively inexpensive upfront.

  • These people are common, there is a lot of competition, and it's a buyers' market.

Cons

  • You get what you pay for.

  • This will most likely be throwaway code.

  • It's risky. You don't know what you don't know.

  • Managing across time zones, language, and context can be difficult.


Our Advice


If you are strapped for cash, you can opt for spending on advertising and providing your service/solution in a lower-tech way rather than jumping into development.


If you are going to work with more affordable developers, we suggest you find someone knowledgeable enough to define requirements and manage development. You can compensate them with equity and give them a managerial role. This person may support your vision, but be uncomfortable with the risk required to commit full-time to a new venture. This can work incredibly well if your goal is product validation, and will be a great stepping stone towards future fundraising.



4 - The first engineering hire


If you have a seed round of over $200k, you may be able to hire an engineer to build your product. Combined with a modest amount of equity, you can spend the year working on product development and business development simultaneously.


Pros

  • You have a partner without having to give up a lot of equity.

  • You can find a high-quality person, have constant contact, and a short feedback loop.


Cons

  • People who are willing to do this are rare (although less rare than the sweat equity path).

  • No one is the best at every function, and you will be counting on one person to do the work of a team on their own.


Our Advice


This person should focus on their core competency and complement their skills with freelancers and other contractors. You should decide if your priority is user experience or core technology, and hire accordingly. Be honest with them about your runway, your goals, and your expectations. Make sure you have a full-time need. If your product requires 3-6 months of building, having someone full-time might lead to overbuilding or idle hands. Neither of those is good for your business.



5 - The million-dollar seed round


If you are fortunate enough to have the track record needed to raise a million-dollar seed round pre-product, that's awesome! You can hire a full-featured team of the best talent Silicon Valley has to offer and build the product of your dreams. There are still some downsides, though.


Pros

  • You can afford the quality of talent that you need.

  • You can hire the best and build the best product for your users.


Cons

  • You will spend a million dollars on making your product.

  • You might feel validation from raising money before actually validating the product.

  • You might need to raise money again before you're profitable enough to support your payroll on your own.


Our Advice


Focus on finding and validating your product-market-fit before you build the team. Being able to afford a team doesn't necessarily mean that's the best route forward. At this stage, the product and business will likely change, and the earlier on you hire an in-house team, the less flexible you can be with your vision. If you want to keep your options open, don't be Uber, be Kylie.

6 - The Get It Built Way


Having experienced all of these scenarios first-hand, our founder started Get It Built with one guiding principle - that building profitable businesses using technology is better than building venture capital dependent companies.


Our advice is for profit-focused rather than valuation-focused businesses. We are here to create paths for different types of technology businesses. This is the story we are here to facilitate.


Validation


You find a market you want to serve. Then, you validate that they have a problem that they are willing to pay to solve by selling them a low-tech solution.


Definition


Once you're confident there's a market for your idea; you come to us. With an investment of $10-30k, depending on the complexity of the business, we can deploy engineering, design, and product experts to collaborate with you on defining your product's design and technical requirements. At this stage, we focus on the visual and technical aspects of bringing your vision to life. We don't take any equity, and we do not require any further commitments. After this phase, you will have a visual representation of your product, technical specifications, as well as an estimate of the development costs. You can use that to fundraise from investors, continue selling your solutions, pre-sell the product, or use an alternate funding route. With a validated solution and a clear roadmap, you will be talking to investors with more confidence and leverage than ever before.


Development


After fundraising, you come back to us to build the product or take another route that fits your situation better. We are best equipped to work on projects with budgets in the $50-500k range. Our process aims to combine the best of both worlds; you have a world-class full-featured team at your disposal, without the commitment of having them on your payroll. By focusing on deliverables, we deliver high-quality software at a fraction of the cost of hiring a team.


After you launch your product and your user base grows, you can decide if you are ready to hire an internal team. If you are, we'll hand over the code. Alternatively, if you prefer, we can also continue maintaining it for you. Our process is designed to support founders who want to build their businesses on their own terms.


Pros

  • Your implement your vision

  • There is a world-class development team working for you.

  • You can adapt and manage risk at each stage.


Cons

  • Not having an in-house tech team may create investor skepticism.

  • Being a solo-founder is lonely.


How Will You Build Your Product?


We hope this article helps you understand the many different ways there are to build tech products.

Each path has a different price point and various potential pitfalls. However, you can start a successful tech business in any of these ways.

If you think the Get It Built way could be right for you, we are here to help.



©2020 by Get It Built.