Re:Ask HN: Is Revenue Sharing a scam?
by codemonkeymike on Thursday March 21, 2013 @02:10PM
(#5417496)
You make a good point, the website is offering a new service. A service which my friend will be doing most of the work providing the service.
So 5% of his ongoing labor, is this perpetual? How much is the average service contract and how long do you think it will take to build what he is looking for. Also you will want to get a pretty good contract in place. As time goes on people tend to appreciate work that was done in the past less than they did when they needed and start to look at the fees associate with that work as a free ride. You will want to make sure that a year or two down the road he does not decide that you have made enough and try to renegotiate or cut you out completely.
I turned down an offer once to receive 1% or profit on every transaction that came in through some web-services I build in lieu of cash up front. It was the worse mistake I ever made. That service did over 50 mill in profit the first year alone. I should have done the math and took the risk. So it all depends.