We are two business guys starting an online marketplace where we take a commission from buyers and sellers. We have been working with a programmer who we want to move forward with. We like working with him and he has a lot of great input so far. He has come recommended and has pointed us to resources which have greatly helped our development process without billing us for any hours.
As we move forward, we have to decide how to compensate him. Do we contract him for solely an hourly rate? Do we give him a combination of equity and revenue streams?
This is a fairly complex multipage marketplace with many integration and user interface functions. We are starting with $10,000. The programmer has decided that he likes our idea and is willing to cut his hourly rate by 50% ($60 to $30 an hour) and take some percentage of future revenue and/or equity in the company (non voting shares).
What would you recommend in this situation? Possible problems? Possible Benefits?
As we move forward, we have to decide how to compensate him. Do we contract him for solely an hourly rate? Do we give him a combination of equity and revenue streams?
This is a fairly complex multipage marketplace with many integration and user interface functions. We are starting with $10,000. The programmer has decided that he likes our idea and is willing to cut his hourly rate by 50% ($60 to $30 an hour) and take some percentage of future revenue and/or equity in the company (non voting shares).
What would you recommend in this situation? Possible problems? Possible Benefits?
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