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INTRO A millionaire that born poor

blackm13

New Contributor
Sep 6, 2019
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Hi all,
I just finished reading The Millionaire Fastlane.
I think that it's among the best books that I have ever read and the reason it's that it's saying what the average chump is afraid.

I am a Software Engineer and from age 14 my goal was to own my own company and became a millionaire young enough to enjoy the freedom.
I am 31 years old and unfortunately, it's getting harder because you have more responsibilities than a 20 years old guy (rent, apartment expenses, social expenses).

Last 30 years I was a sidewalker! No savings, living paycheck to paycheck and one salary away from financial disaster. This year I decided that I had to get my sh*t together and I transitioned to slow lane. Not the investing part but cutting a lot of unnecessary expenses, coupons, etc.
The reason is that I need savings because I may need to quit my job to build my FastLane business, and you know things probably won't work well at the very first months of a company.

At the moment I am a full-time Mobile developer at a company and after work, I am freelancing (iOS/Android and WebApps) for a company (that I used to work ). The reason for the freelancing (other than money) it's that I believe that I will find an opportunity to build a product for a company, get paid, then modify it and resell it to other companies with minimum effort or I will get a chance to build something bigger. As @MJ DeMarco says you will get lucky if you are "doing something" and not watching TV by the couch.

Anyway, I would like your input on this:
I have a client that organizes events. They already using software that costs them $300 (on average per event) and they need me to develop a new web app tailored to their needs. They have 80 events per year and they are using the software on 40 of them. The software will cost $30k (I am not paying anything other my man hours). So that means that I will break even in 3 years.
So I have 3 options: (if you can think another option please let me know):
1) Develop an MVP with core features (without signup views and some other views that will make the web app more dynamically to be used by other clients in the future) with the cost reduced to $15k
and get the most only from this client.
2) Develop the full feature software which it will cost $30k but it can be sold to other clients and create a product.
3) Look for another chance since this will take me more than 6 months (working after a full-time job).

Normally, I would go with option 2 but the event software market it's saturated and since I am not the best in UI/UX (for websites) I don't believe that I can offer something better than current software.
Let me know your thoughts!
 

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Actionary

Contributor
Aug 14, 2014
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I am not paying anything other my man hours
This is going to sound rough, but you need to stop thinking like an employee/laborer.

All I read was how much you want to keep this 15-30k for yourself.
Also, Is this project already secured? have the contracts been signed?

If not, then all you have from the other party is kind words (They are shopping).

From my math, 300*40 = $12,000/event spent.

--------
If you want to be a business owner, then build a business. Business owners get a smaller slice of a larger pie. Meaning 100% of 0 is still zero but, 20% of 20k if you hired people smarter than you to "work all these man hours" is the beginning of a business.

Since you have trust with them, give them the options for speed or customization.
If their budget can allow 30k give them tiered info (which if they are spending 12k/event it seems likely).

Tell them:

- I can do it at a basic level for 20k (includes these features)
- I can do a pro version, that will make it easy for anyone on your team to run (lowering the costs of skilled talent on their end)

- Ask what their timeline is on this? (Charge more for speed)
Because if it takes 3 months to build (it costs 12k+ or more for however many events pass between building ------> That's why you need to build a team to do this faster).

In return, you'll be able to crank this out for them, and build trust and rapport with a group of developers that can work with you.

Hire at least two developers that are as good or better than you at mobile development and UI/UX. They should be good at communication, meeting deadlines, and should be able to finish this out alone if they had to.

Become a project manager. Pocket 25% of 30k. (7.5k)
Use it for building out your business (not eating/and buying dumb stuff).
This is seed money for covering employee time if people dont pay quickly, costs of indesign and other pro typing licenses, etc.

--- Network and build out a little agency of freelancers using the same model.
--- Get on Linkedin and start getting leads.
--- Get people who can help you out with getting leads, seo and more in your local area.


If this app is as good as you say, you can sell the app on a monthly basis at a fraction of the competitor price, continue to get in new app development projects for your team to handle, all while working your day job.

Keep that up, eventually hire a project manager/biz dev and you'll have a real business and be fastlane.

Good luck.
 

MJ DeMarco

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So you have a client that wants to pay you $30K for an app? Or they want you to do it for FREE but it will cost in $30K? I'm having trouble understandng your options.

IF someone wants to pay you $30K for an app, you have your first customer for the software. Turn it into a SAAS product and find more clients. The first client is the hardest.
 
OP
OP
B

blackm13

New Contributor
Sep 6, 2019
4
1
11
This is going to sound rough, but you need to stop thinking like an employee/laborer.

All I read was how much you want to keep this 15-30k for yourself.
Also, Is this project already secured? have the contracts been signed?

If not, then all you have from the other party is kind words (They are shopping).

From my math, 300*40 = $12,000/event spent.

--------
If you want to be a business owner, then build a business. Business owners get a smaller slice of a larger pie. Meaning 100% of 0 is still zero but, 20% of 20k if you hired people smarter than you to "work all these man hours" is the beginning of a business.

Since you have trust with them, give them the options for speed or customization.
If their budget can allow 30k give them tiered info (which if they are spending 12k/event it seems likely).

Tell them:

- I can do it at a basic level for 20k (includes these features)
- I can do a pro version, that will make it easy for anyone on your team to run (lowering the costs of skilled talent on their end)

- Ask what their timeline is on this? (Charge more for speed)
Because if it takes 3 months to build (it costs 12k+ or more for however many events pass between building ------> That's why you need to build a team to do this faster).

In return, you'll be able to crank this out for them, and build trust and rapport with a group of developers that can work with you.

Hire at least two developers that are as good or better than you at mobile development and UI/UX. They should be good at communication, meeting deadlines, and should be able to finish this out alone if they had to.

Become a project manager. Pocket 25% of 30k. (7.5k)
Use it for building out your business (not eating/and buying dumb stuff).
This is seed money for covering employee time if people dont pay quickly, costs of indesign and other pro typing licenses, etc.

--- Network and build out a little agency of freelancers using the same model.
--- Get on Linkedin and start getting leads.
--- Get people who can help you out with getting leads, seo and more in your local area.


If this app is as good as you say, you can sell the app on a monthly basis at a fraction of the competitor price, continue to get in new app development projects for your team to handle, all while working your day job.

Keep that up, eventually hire a project manager/biz dev and you'll have a real business and be fastlane.

Good luck.
Hi @Actionary and thanks for your helpful feedback. Don't worry, I appreciate the honest feedback and you are right. I was thinking like an employee. Since my time is limited it makes sense to outsource it to another team of developers.
 
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OP
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blackm13

New Contributor
Sep 6, 2019
4
1
11
So you have a client that wants to pay you $30K for an app? Or they want you to do it for FREE but it will cost in $30K? I'm having trouble understandng your options.

IF someone wants to pay you $30K for an app, you have your first customer for the software. Turn it into a SAAS product and find more clients. The first client is the hardest.
Hi @MJ DeMarco ,
They actually want it for free but they are open to entering into a contract that they will use the app until the full price it's paid off (about 3 years).
About turning into a SAAS product: My concern it's that it's a really saturated space with already really good products and I am not sure if mine it's going to stand out. I may try to find a niche (eg. for lawyers or travel agencies) and make it the "obvious" option.
 

biophase

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Where do you come up with the $15k and $30k number?

If there are other options out there why aren’t they using them?
 
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blackm13

New Contributor
Sep 6, 2019
4
1
11
Where do you come up with the $15k and $30k number?

If there are other options out there why aren’t they using them?
I have the specs and I calculated the hours needed x My hourly price. $15k for MVP and $30k for a dynamic solution that it would be used by other clients also.

They came to me because of their guy who is using the product recommended me(He is my friend ). Also, they want me to create a "custom" solution for them instead of the general event software.
They already using other software and they're not happy with their customer support.
 

biophase

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I have the specs and I calculated the hours needed x My hourly price. $15k for MVP and $30k for a dynamic solution that it would be used by other clients also.

They actually want it for free but they are open to entering into a contract that they will use the app until the full price it's paid off (about 3 years).
I still don't understand. So you are going to charge them your full retail hourly rate. But they aren't paying you that, so what does that even mean? It's not costing you $30k, because you aren't sacrificing another hourly job to make it. It's costing you X hours.

Why would they expect you to code them something for free?

If they use it until it's paid off, how are they paying you? Per use? Per month? Is there a contract?
 

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