As a simple rule, you can usually break MVP clients into two groups:
1. Cash poor wantrapreneurs who expect the world but can't pay for it.
2. Entrepreneurs with realistic expectations who are able and willing to pay a fair rate for labor. The founder of Groove is a good example[1].
The person interested in a 3 week engagement that costs $2,345 is more likely to fall into the first group.
You want to do everything you can to avoid the first group, even if you're starting out and trying to build a portfolio. These clients are far less likely to collaborate with you effectively and far more likely to be unprofitable to serve. Additionally, because they don't have the capital reasonably required to execute on their ideas, you'll probably never build long-term relationships, which are very desirable for solos.
In terms of targeting the latter group, which would enable you to charge a lot more, you're far more likely to be successful if you can demonstrate that you have some product development chops. A lot of entrepreneurs need help translating their knowledge and ideas into functional requirements; many of them are not going to come to you with ready-to-implement wireframes, user stories, specifications, etc. These entrepreneurs need a partner who is capable of being involved in the tasks that come before implementation.
My biggest concern with doing something like this would be that you'd burn all your time negotiating - because clients are going to show up with a "3 months to implement" idea, and you're may spend more (unpaid!) time stripping the thing down to a reasonable MVP than actually coding.
"We'll agree beforehand on a list of features" has a lot of complexity hidden inside; if a client shows up with an idea "be the next Google" and hands you a list "1. SEARCH TEH INTERNETZ", what will you do?
I know you were joking, but I once had a guy complain about just that. I contributed a (very basic) search feature to some FOSS software and a user complained because it "wasn't as good as Google".
My response was something like "If I could write a search engine as good as Google in my spare time, I'd be living a lifestyle somewhat more luxurious than the one I actually have."
I see a lot of people advising you to increase it. Don't. Its a perfect number with a simple idea "MVP for $2345". It has in-built chance of virality/wordofmouth for its USP - so you are getting free marketing dollars inside that number.
If you charge 10K+ like others are suggesting, then you are competing with 10000 devs ready to do that work. If you charge 1K, you will lose money and target the extreme low ballers, and no amount of free marketing can make it sustainable. Your number of ~2.5K is a perfect balance.
But set a few hard-rules before you agree on a project:
- wireframes, mockups with annotations to avoid scope-creep
- design will be bootstrap quality (otherwise design is never-ending)
- is designed for demo purposes, it will break if 10,000 ppl access it.
Remember your clients are "idea mongers" who want to validate an idea, but dont have the chops to do it themselves. So your clients will not be businesses or startups - but plain old business folks with ideas. Stick with it. If the demand is great, then outsource it or franchise it, but control quality by keeping it within your strengths (py + web.py)
since you missed "1" here is a way to include it:
This is a fantastic opportunity for someone to build a marketplace that connects folks who need a quick MVP built with freelance developers. You could go a step further and break it down by back-end, front-end, design only, or all of the above (because maybe you already fill one of those roles yourself).
You can bake in the idea of a cash/equity split if the freelancer was interested as well.
The idea would be to limit projects based on time, scope, or budget from the get-go and stick to the MVP market niche.
Edit: Thinking about this idea more and reading more comments on this thread gave me another idea. Many people have commented that it might be a good idea to have your app fully wire-framed and thought out first. Need help with this specific stage before getting into the development of the MVP? Just another channel on the marketplace.
Idea Consulting -> Wire-frames -> MVP Development -> Design
All of course are optional and you could obviously swap Development and Design.
Chris Granger does (did?) offer a similar service[1]. I think his price (5000$) is more sustainable for a developer, but I'm not sure how the market is for this kind of work.
Chris, if you are reading this, please share your experience with us.
I got/get lots of offers, but in general the projects were pretty uninteresting (so many clones), people didn't really know what they want, and I found that what people really needed was someone to think through their ideas with them, not a prototype.
At that point in time 5k was reasonable. The price would go up quite a bit if I were doing it now though. But I doubt I'd do it again - the work didn't end up being as exciting as I thought it would be.
What I would consider doing in the future is the "idea consulting" I discovered most people ended up needing. I have a knack for pulling things apart and putting them back together in interesting ways :)
Think of it this way- you're either paying them up-front with your time and work or they're paying you up front with some cash.
As somebody who has been burned badly by somebody who didn't pay up after work was delivered I can tell you do not ever work before getting some fee up-front (preferably the entire amount). If the person can't afford to pay you before you start, you probably don't want them as a customer.
Conversely, those who are ready, willing, and able to pay are the best and most lucrative customers to have (and you can charge a lot more than $2300 for your services).
Yes. 1/2 upfront for smaller projects, 1/3 for larger projects is the standard.
For ongoing projects that you bill hourly instead of fixed cost, try to do retainer instead of invoicing and then getting paid a month later model.
Cash flow is THE single most important thing in this business. Try to get paid as early as possible, and delaying paying others as much as possible (while still paying them reasonably soon, of course - just try to negotiate better terms upfront, i.e. get paid Net/15 and pay others Net/30).
Also, never EVER work without a contract. For every project, have client sign MSA and SOW. I bought mine from here: http://msabundle.com/ and modified per my needs.
Yes, definitely. I just did that for two projects in the past week; but it was 1/2 up-front. Albeit, they were close referrals. YMMV if it's potential customers who don't know you.
Oh, definitely. When I was freelancing, I wouldn't start a project without a 50% deposit. I also made sure that 50% was enough to cover my expenses and sanity.
Unless I know the client well, I get a 20 hour retainer up front (which is about as much as I usually bill any single client in a week unless I really like the project.) I send them a bill every week, and while I'll give them a little credit on getting it paid, I won't go more than a week without getting the retainer paid up unless we've got some history.
Sometimes you have to be firm on it, but trust me, beats the hell out of trying to collect 10-15k in outstanding invoices when your mortgage is due.
Yes. A client that doesn't pay up-front doesn't have any skin in the game. It makes it easy for them to walk away.
Also it serves as a negative filter, weeding out cheap or incompetent clients. Like any other business, finding good customers is vital to your flourishing.
Back when I was running a web development company, I toyed with this idea a few times, but couldn't find a way to do it and not lose money. Hope your experience is different. Good luck!
I didn't actually go ahead and implement it - I just couldn't make the math work. In my opinion, there are too many unknowns with this model - you're quoting the price of a project without knowing all features, talking about design iterations, supported browsers, and a million other things. And if you substantially increase the price after getting the requirements, clients won't like that, because the most important number for them is the first number you tell them - in this case, $2,345.
I could go on, but I don't want to discourage you. You should try it, just be careful not to lose money. Also, if you're in the western world, make it $10,000 or $20,000, that's a more realistic number :)
Yeah, book is much better though, if you haven't read it, I highly recommend it!
I wasn't able to find a way to present what we were doing as a product, and kept going with a traditional model of getting project specs, doing discovery on requirements and budget and then putting together a quote.
yeah, it seems the movies veered off a good bit, based on the wikis i read ;)
interesting. I think that's the basic business model my boss has. it seems to be working now, but i'm always curious as to what other models are out there
This is a ridiculously low number. I'd say you really need to double it or so. Good luck! Looks like you've got some pretty cool past projects under your belt.
I love the idea - but I wonder why the price? it does seem really low. At 19 bucks and hour pro rata, you are not storing up cash to get through the hours when you are not earning, like marketing, talking to clients, understanding what they want.
Unless the projects are carbon copies (in which case automate) this will never work. The context switching will kill any productivity. You can work in parallel by threes - one in sales funnel, one in development and one in maintenance mode. And that will be tough.
I guess if you're just starting, that's decent money, but I don't think I could run with the same idea myself. I'd probably need to add a 1 to the front of your number.
To be honest, I said 3 weeks just to be safe (the old rule of doubling what you think you need). The plan was also to work on multiple projects in parallel.
You're right though, I am just starting off, and already feel a bit guilty asking for anything north of $5k.
Don't feel guilty. If you're price is too high you simply won't get leads. Better 3 high-paying customers than 10 low-paying customers: less support time.
I think your logic is faulty here. There are two reasons to charge more than your inner "imposter syndrome" will let you:
- avoid the arseholes: at 1cent to 50bucks any idiot will spring for the idea and make your life miserable. At 2345, you should be out if their price.
- to fund your own tenure. We work at 19 bucks an hour because the employer just needs our body at a certain location. Not our brain or our lifelong learning.
But you need to use those things. Fund them.
Maybe I have too much fun in my jobby job, but it would be tough to pull off entry-level dev pay (50k-ish in the US Midwest) at this level and probably not as fun as some regular jobs with minimal skin in the game.
Plus (again if US) you'll pay more taxes if self-employed.
If you lived near me, I'd seriously consider hiring you. And you'd get to play in python with lasers and robots (sometimes). And have a guaranteed revenue stream.
Working on multiple projects at once on tight deadlines is a great way erode the quality of the development you produce for your clients. I would think with such short deadlines you'd want to give your clients the courtesy of focusing on them individually and then stagger development of your future projects accordingly.
You are doing the wrong calculation. He isn't claiming to spend 40 hours a week on the prototype. This could be done in spare time, taking advantage of time that is probably netting $0/hr, and in many cases probably can be done in less than 120 hours (especially if he locked down the technology stack)
I agree with the others. My initial assumption at this amount is that it wasn't 120 hours of work. It could be only 30-40 hours of work to get some basic python program going. He can control the features during the negotiation phase.
This is super inspiring and really makes me want to try a similar experiment. I've been wondering how I can make income while doing month long stays in different countries throughout the world, and this seems like it would be about perfect. New country, new project, enough income just to get by. Keeping the price low is not necessarily a mistake. It will allow you to pick from a much large range of products and if you can live for two months on $2000, why not just keep it low. The world doesn't necessarily always have to be profit-maximizing.
P.S. I checked out your essay about the first person view. I think you should watch this video from the BBC. It describes how this first person view that you describe is not actually making the decisions for your body, an MRI machine can predict what decision you will 6-7 seconds before you become conscious of making a particular decision. This doesn't necessarily answer your question, but the video shifts the question from why am I making decisions to why does brain make me think I'm making decisions.
How can you commit to a fixed amount to execute on an idea that requires an unknown number of iterations, re-evaluation of initial assumptions, and customer feedback? Maybe this is possible IF your customer is a sensible designer who can iterate in parallel with you and has a realistic sense of what an MVP is and isn't. If your customer is just some schmuck with 2.5 grand to throw around and no product experience, you'll likely find yourself fighting time consuming battles of scope and deliverables. And how can you juggle multiple projects like that simultaneously, when there's unavoidable friction that comes with the context switching? And, how fulfilled will you feel when your day-to-day is filled building things that are bug-laden and just minimally good enough? What kind of portfolio will that generate for you?
I sit down with each person and agree on a specific list of features they want before I get started. I say explicitly on the site that the $2,345 is only for one iteration.
I think the definition of what constitutes a single iteration is subject to personal values and tendencies. E.g. I myself have a hard time calling a task "done" when it simply meets a rough guideline that was specified in text ahead of time. For me, it has to be better than just satisfactory. And that's before adding the customer's expectations into the mix. Hence, I would be a horrible candidate to try this. But I have met devs who are the other way around, and you may well be like that. I do think it's bold of you to give this a shot.
I'm very intruiged by this idea, because I'm in a somewhat similar situation. I'm a fullstack developer all the way and love building products, but I haven't quite figured out a way yet how to make an income from that. Good luck and I would love to hear hot it's going.
Thanks for all the helpful advice! Totally didn't expect so much feedback.
Question for the more experienced people here: if I changed it to "$2,345 per week, and it'll take 1-3 weeks" instead of "$2,345 for up to 3 weeks," would I lose anyone I shouldn't be losing?
think if fivver has a complicated pricing or higher cost, would it be as popular as it is now? It would be completing with 1000s of other apps which does this thing.
Reduce scope or draw boundaries, but dont bump up the magic number :)
How would you market this (aside from posting on HN)? I want to do the exact same thing but charge more. Trying to freelance and I'm just unable to find clients.
I considered both when I first got started. Django was just too hard for me. When I read code using a framework I've never seen before, usually I can still kind of tell what it does. It might be my own stupidity, but when I read Django code I have no clue what it does.
I did consider Flask, which is much more similar to web.py, but eventually chose web.py because I was a fan of Aaron Swartz' work at the time.
I know one of the main developers on Flask. He's an exceptional fellow and extremely talented. I havent used the framework before but I hear it's highly recommendable in general.
This is ballsy but cool. Being a full stack business guy, full stack developer, and someone who had done years of freelance in the past, I'd be afraid of the scope creep and complexity issues that are going to rear their head. But more power to you for choosing to try to tackle them, I hope you end up on top.
I dunno... It seems to me that there's a lot more to creating a minimum viable product than simply building a python web app for X amount of money -- especially without knowing the specs in advance.
Good means to advertize your site on HN, though. ;-)
Depends on where you live. I was in NY and that wouldn't have gone very far. Try out a few projects, and you can change it later as you feel more comfortable charging more. Figuring out what you're worth is pretty hard when you're starting out because it's easy to approach pricing based on what you would pay for the service your offering, than what the reasonable market price is, or even what $ value your client is getting out of what you're building them.
Also charging more for successive jobs wasn't a joke. You're being pretty transparent about your pricing; you could keep going and post how much each project cost and what the thing was that you built for that. Might make a more lasting marketing ploy.
Yes, it's too little. Remember patio11's advice: you are not charging what the work or time is worth it TO YOU, you are charging what your output is worth it TO YOUR CUSTOMER :)
Also, having a starting price in the 10k+ range will help weed out bad apple customers. Trust us when we say that you want fewer high quality customers than a lot of pain-in-the-neck customers. Finally, charge 1/4th upfront like another poster said so you don't get screwed.
Having a starting price in the $10k range also weeds him out. In my market (Austin), if I have $10k for a prototype (even half that) I can throw a cat and hit a Ruby guy, a Python guy, a PHP guy, etc. The price as he has it is low enough that people with "an idea" might take the plunge to get a prototype going.
If I were to have one suggestion it would be for his site to spell out some parameters about what a prototype is so there are no later arguments.
I respect your desire to stick to your word. However, this shouldn't restrict your pricing over the coming weeks and months. Your time is limited, so if demand is strong your price should increase to better fit the market. You could always make an update later on that includes a note that clients may reserve at the current listed price but it could change over time.
Yes. if you're living near the poverty line "by choice", having money isn't a problem you're trying to avoid, it's spending it. The two aren't related.
If your goal here is to build customers, portfolio and reputation, do as others have suggested - feature a rolling price. It'll get you want you want, and set you in a better light.
Hm, I was considering going from "$2,345 for 3 weeks" to "$2,345 per week, up to 3 weeks." But the fee right now isn't as low as it seems; I was planning on taking projects in parallel.
1. Cash poor wantrapreneurs who expect the world but can't pay for it.
2. Entrepreneurs with realistic expectations who are able and willing to pay a fair rate for labor. The founder of Groove is a good example[1].
The person interested in a 3 week engagement that costs $2,345 is more likely to fall into the first group.
You want to do everything you can to avoid the first group, even if you're starting out and trying to build a portfolio. These clients are far less likely to collaborate with you effectively and far more likely to be unprofitable to serve. Additionally, because they don't have the capital reasonably required to execute on their ideas, you'll probably never build long-term relationships, which are very desirable for solos.
In terms of targeting the latter group, which would enable you to charge a lot more, you're far more likely to be successful if you can demonstrate that you have some product development chops. A lot of entrepreneurs need help translating their knowledge and ideas into functional requirements; many of them are not going to come to you with ready-to-implement wireframes, user stories, specifications, etc. These entrepreneurs need a partner who is capable of being involved in the tasks that come before implementation.
[1] https://news.ycombinator.com/item?id=7604055