Forums: Discussions for entrepreneurs and small business.

Ok, I've had an idea for a completely original database-driven website that will provide a service to a categorised market and the (potential) users will pretty much all be online purchasers. The website will be reliant upon user input (only text and drop down boxes). The revenue will be from ads.

Now i definately do not have the skills to produce this sort of website. So my options are 1) to pay for a designer to do it, or 2) get my long-time friend (currently in final year of a internet computing degree) to do it for a stake in the business.

I've briefly explained it to my friend an he agrees it is a good idea and quite simple to implement (although I did not explain some of the smaller details i have planned).

I've thought of the benefits and implications of both, and I think it hinges on the ability and time of my friend as I don't want to give away equity and find out he can't implement things and/or doesn't have the time (if he is busy at uni/full-time employed).

With a designer comes the initial capital cost, but a polished product. However if the website is successful there is a whole host of things I might possibly do, so I need to have a good relationship with them.

What do you guys reckon?

Cash flow is the main issue at the moment. If you need regular work done then I think your friend is the best option. However, it's up to you to judge what's the best option with regard to your situation.

If you choose to go with your friend and provide an equity stake, you have lots of options as to how that partnership is set up, both in the percentage he can earn through his contribution as well as the exit strategies available to both of you. Whatever you do, be sure to draw up a partnership agreement or use the operating agreement of your LLC to clearly delineate who does what, who gets what share of the company, and what happens when one of you wants out (or wants the other one out).

Best regards,

Molly Donaldson

Before deciding one way or the other, you should sit down with your friend and give him ALL the information. Find out if he really can handle what it is you want. Those things that seem like small details to you may end up being a giant wrench in the works when it comes to writing the code.

If he still seems confident, ask him to build a stripped-down prototype for you to see. No formatting, just functionality. If he can't do it, you have your answer.

At the same time, you are going to need more technology advising than an undergrad can reasonably provide. School is awesome but it is no substitute for experience developing in the real world. It would be worth talking to a few professional web developers to see what they have to say. They may know of a pre-existing solution that will meet your needs with only minor tweaking, thereby saving you 90% of development time. They may be able to anticipate what you're going to need in 2, 5, 8 years and recommend scalability options so you don't have to build the whole darn thing over again. They'll be able to recommend the best server technologies for your project and may have different ideas than your college friend. (I recently took over a small blog + portfolio type site that had originally been written for ColdFusion. That's like trying to swat flies with a cannon... )

Anyway, try to hook up with a pro developer willing to play an advisory role for you even if they don't build your site. Ask if they'd be willing to be on your board of advisors as you get your project up and running. You can easily get eaten by web design sharks if you don't have a technology guardian angel watching out for you.

Thanks guys and gals for your replies. I agree with you Rabbit, I think I need to go through with my friend the whole workings of the site, the way I think it can earn revenue and any developments I can think of down the line. If this is still relatively simple, then I will try and nudge him into building a prototype. When I get a bit of time I'll look into the types of partnership agreements, that will best suit my situation. Otherwise I'll try and locate a competent web developer.

To be fair I think the biggest hurdle for my website will be to get users to contribute as without it there isn't much of a service. I've come across Amazon's Mechanical Turk which seems interesting. Or I have thought of the possibility of coming to an agreement with some retailers (in the relevant sector) to offer a link to my website in return for advertising spots on my website for a time period.