HN Explorer

Ask HN: I will pay you $2000 and code the MVP for your side-project

211 points by esquire_900 ↗ HN
Premise 1: Investors/Incubators over-estimate their ability to pick good ideas/startups.

Premise 2: Software by a lone developer is not pragmatically different from software by a big A-team. It’s the market fit and marketing / sales that makes or breaks the project.

Premise 3: Most freelancers will not build and/or follow-through with their ideas, because they are not sure it will sell.

Premise 4: HackerNews has a decent number of people who know how the world works, and how a little glue would make it better.

Based on these premises I present The Proposition 2.0 (following version 1.0 [1]):

I’ll pay you $500 for your “real-life problem that needs a software fix” idea and market validation / research. I will build the MVP and give you another $1500 to bring us our first paying customer(s). We split the resulting product 80-20 as co-founders.

[1] https://news.ycombinator.com/item?id=5037694 [2] https://www.simonnouwens.com/hn

130 comments

[ 2.9 ms ] story [ 152 ms ] thread
bruceb
Sounds good. Though part of being a cofounder is more than MVP, is there any vesting provision? Also not 100% clear who gets the 80%
darrenf
On the link from [2] it says:

> We split the resulting product 80-20 (me-you) as co-founders.

I found it confusing that there was no [2] in the body of the post, only the footnote list.

twiss
Out of curiosity, what was the outcome of The HN Proposition 1.0?

Edit: http://www.simonnouwens.com/hn/index.php/2019/03/31/init-com... answers the question

symkat
"The idea gained some traction, and hmexx received over 250 emails, which were filtered down to 5 picks. Out of those 5, three were discontinued (1 after market research, 2 after failure to deliver MVP). The 2 ideas that were put online appear to be http://parametrek.com (an experimental product search) and http://www.textrep.com (an open-house notification system). Both projects as well as the experiment ended up floating somewhere on the software-graveyard, which is a shame, as the idea is great and the premises are (mostly) correct. Besides that the proposition generated a lot of community interest, which ended up being unused by the project." -- http://www.simonnouwens.com/hn/index.php/2019/03/31/init-com...
dfc
I point people to the flashlight search on paranetrek all the time. I had no clue about the backstory.

If you want a new flashlight check out http://flashlights.parametrek.com/

parametrek
Everything he wrote about that was wrong.

I was never accepted into the original Proposition. I did not get any money or advice. But my elevator pitch was good enough to convince me to go through with it anyway. And I'm hardly "floating in the software graveyard."

But I am glad you enjoy my site ^_^

esquire_900
Rectified this on my website, and apologies to parametrek for getting it wrong (and suggesting the project failed). Only found some sparse information online, and failed to do my homework properly after that. It's a pity hmexx didn't share too much of the results, would have been an interesting piece of information.

Sorry parametrek, didn't intend to bash your work - you obviously did better in the side-project business then I did so far :)

mthoms
Hi I really like the site, kudos.

Are you still open-sourcing the search tech? The github link on your site is broken. Cheers.

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azhenley
How many projects are you looking to do? One at a time?
savrajsingh
Just to clarify who gets the bigger share of equity?
azhenley
So you'll pay $500 for an idea you like, pay $1500 after first customer, and then pay a 20% royalty after that. Seems like a potentially good deal.

Can you elaborate a bit more about what type of projects you are looking for? Any specific markets?

mkagenius
> pay $1500 after first customer

You(or friends) can become the customer if cost is < 1500.

craftinator
The idea is that for 20% you do all of the marketing/business side of things, as I understand it.
esquire_900
Yep. Looking for something "side-project worthy"; something that can be build in a reasonable amount of time and generate an interesting revenue stream. I don't mind which market but am specifically looking for a niche, a piece of inside knowledge you have that we can exploit together :)
browda
Premise 5: My expectation is that you don't have anything close to what I would expect -- especially for an 80% share -- so why should I waste my time with you?
tnckb
Further information here: http://www.simonnouwens.com/hn/index.php/2019/03/31/init-com...

After reading that, I'm interested. Emailed you.

Also, to the person who asked about who gets bigger share of equity: as mentioned in the link above, it looks like you get 80%, the OP gets 20%.

Nevermind: It's OP 80%, you 20%.

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tptacek
This doesn't make much sense. A 20% royalty is an absurdly high price to pay for an idea, for which you'd do all the execution; meanwhile, if you expect them to do substantial work as a "co-founder", 20% is absurdly too low.
jessriedel
If an idea plus zero additional work is worth less 20%, but an idea plus substantial additional work is worth more than 20%, isn't there an amount of work that makes the agreement worth it? I guess you have some sort of intuition that there's no reasonable way to agree to anything in between for incentive reasons or something, but that's not clear to me at all. Can you explain?
pas
Transaction costs are not 0. So even if it seems like that would be a nice and stable equilibrium, getting there might be simply too expensive.
jessriedel
Sure, that's possible. But what's the actual argument?
JamesBarney
The biggest issue is you have information asymmetry between the domain expert and the developer. Because developers can't tell the difference between great ideas and bad ones they'll pay the same price on the market. If all ideas sell for the same amount and you're a domain expert than it makes sense to keep your best ideas and sell your worst ones. This drives down the average quality of an idea as well as price which means less domain experts are willing to sell at market price which drives down quality, etc... Very similarly to an insurance death spiral. A similar process also drives down the average quality of the developer working on the work.
jessriedel
That adverse-selection argument applies to all selling of ideas. It doesn't address my question.
cma
The idea is probably to get a lot of pitches and then select the idea, no matter what it is, from whichever applicant has the most wealthy accredited investors as family.
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backpropaganda
Consider instead that the person is an investor. But instead of investing money, they invest not only the initial idea, but also help solve some problems along the way. So, very similar to investors, but instead of money, the investors also provide the idea. 20% sounds reasonable for that.
esquire_900
The intention is to pay for an idea, validation and first customers (by being an idea from someone that lives/works with the current problem).
jasode
I don't think anybody misunderstands your intention. The disagreement is the effectiveness of your proposition.

The problem is that your 80/20 deal causes an adverse selection that attracts the lower-quality non-coders that you don't want.

If non-technical non-programmers like Evan Spiegel (Snapchat), Brian Chesky (AirBNB), and Steve Jobs (Apple) can hustle to find that 1st angel investor, or 1st VC funding, or 1st paying customer, that means they also have the street smarts to find an alternative solution to your very expensive 80/20 deal.

Even after the biz-idea guys hustle to get that 1st customer, they have to continue hustling to get the 2nd, 3rd, and so on customers to grow a viable business -- unless your thesis is that a new startup with 1 customer is enough to "flip" it to an acquirer like Google/Facebook/Microsoft.

mmastrac
He still has the opportunity to turn down all but the greatest ones (or all of them) so I think that this is a pretty decent way of approaching it.
esquire_900
I think the quality of the average HN user is pretty high, but obviously this might attract low-quality proposals. Honestly every offer to code someone's idea will (I've been there, and fallen for it more then once), take what "nithin001" posted as example.

This isn't the way to find the next Steve Jobs indeed, and that's not what I'm searching for. I'm looking for that consultant that has seen 4 clients wasting 8 hours a week on the same inefficiency. Someone who will get $2k for an idea and a number of phone calls, and a large kickback for sales (s)he makes in his/her direct network. This isn't the way to kickstart a $1bn company :)

jasode
>This isn't the way to find the next Steve Jobs indeed, and that's not what I'm searching for. [...] This isn't the way to kickstart a $1bn company

I get your clarification now. I think some including me were thrown off by your "Premise 1: Investors/Incubators over-estimate their ability to pick good ideas/startups."

In your business opportunities of "consultants who notice a workflow inefficiency but would rather pay 80% to someone else to do the programming work for a new product", that landscape doesn't have "overestimated abilities" of investors. Instead, they don't even look there at all. They need to put more than $2000 to work on a single deal to make their due diligence time worthwhile. For their fund sizes, they're scouting the arena of potential huge $1b businesses. No non-techie founders of that type of business that had any street smarts at all would ever give up 80% equity of a company in exchange for an MVP. By design of your 80% cut, it would only attract desperate losers. That was the "adverse selection" I was talking about.

However, now that I've seen your other replies, your deal feels more like paying a "finder's fee" to the consultant for his/her business idea rather than attracting a cofounder that will share the workload of doing multiple years of hard work with you. Nothing wrong with this but I misunderstood earlier what you were trying to accomplish. In this case, maybe tptacek is right and your 80% is too low and you're underpaying yourself.

modzu
mvps are easy. there are thousands of grads who will build your mvp in a weekend hackathon for free. its the market research/validation that is hard. as the guy with the idea, i'm supposed to do that part and pay 80% to the guy who did the mvp?? or is the op saying they do the marketing and provide first customer?? the wording is terribly ambiguous.
smallgovt
First of all, it's the former. That is, it's an absurdly high price to pay for an idea and first customers given what is standard in the market.

Second of all, it doesn't matter. The biggest hurdle to being successful is getting started. "Getting started" necessarily entails finding an idea you're motivated to work on and a vision to achieve your goals. This guy has found one way to get started. If losing 20% of the upside is what it takes to get started, it's not a big deal.

Just remember you can't keep making decisions that give away 20% of your upside over and over, because you'll end up with nothing (barring extenuating circumstances).

quickthrower2
Actually it's a bit like "spec work". https://www.lifewire.com/what-is-spec-work-1697435. If you get 100 ideas per investment, then the average idea gets .02% royalty.

The chosen ideas will be idea + market research / inside info as to why it is a good idea. That has some value over a one line "Uber for X".

iratewizard
This seems like a doubly losing proposition. If you created my idea and I only get to keep 20%, I wouldn't assist you very much in maintaining the business. If I were to partner with someone, I would resent shelling out 20% to an absent partner. Ideas aren't worth a fifth, and a fifth isn't a suitable carrot/stick.
esquire_900
Thanks for your comment. I think 20% is a fair price for idea/validation/first sell and direct access to a customer space. If it's going to be a $100m company in 2 years then yes, 20% is going to hurt, but honestly I don't expect that.
pytyper2
Maybe not hurt if it was not dilutable, the initial 20% holder could be issued more shares to keep their percentage at 20%. By the time 3 or 4 rounds are raised the initial 80% owner might only retain 20% after dilution. So in the end you have to look at the cap table after future rounds, the fact that during a period of history (probably before there is any real cash to distribute) the split was 80/20 won't matter.
pytyper2
But more importantly, if I build the product and get the first customer what do I need you for? 2k is chicken shit. Unless the idea is a throwaway, something I'm not passionate about, I'd just build it myself.
emiliobumachar
Suppose you have more seemingly good ideas then you could possibly build yourself.
Jorge1o1
Exactly! Gotta focus on one or the other. Either pay me for the idea, or I pay you to do the work.
polony
How do we contact you for a proposal?
oDot
I run SwiftMVP.com -- We once tried offering half-price if people give up the white label and credit us. Apparently, $5000 are not the issue.
esquire_900
That's a cool project! Mind sharing how you get your customers?
hmexx
For a second I thought I was reading through my post history when this came up!
esquire_900
Thanks again for inspiring this in the first place :)
erikig
I'm a big fan of both efforts. Ideas are a dime a dozen (if that) and I like the unconventional and challenging approach that you both took. I'm rifling through my idea notepad to pitch my hat into the ring :)
nithin001
I posted a similar proposition https://webuild.tools (build the software for free and retain the client as the first customer) I have time/interest to build side projects and built many too. But nothing takes off as it is never backed a solid business need. And I am no where close to solving this problem.
esquire_900
Similar indeed, though I'd hope to bump into someone that is willing/able to sell it to their direct environment. Doing a free build/first customer deal seems too risky to me indeed (over-optimizing on what this single person needs). I suspect "premise 2" has to do with this.

I'm interested in hearing a bit more about your experience if you have some time. What kind of projects have you done so far? Nothing that ended up moving the needle a little? Even after further marketing/promotional efforts?

nithin001
Thanks for asking. It's usually web apps built around some kind of networking needs. I built one where people could ask for recommendations from friends. Another one was a hybrid app where users can set a single status for themselves. Now I am working on an amazon reseller site that has curated products. I built another one where users can post their SaaS apps (kind of app store for web products). It usually dies within a few weeks because I am lost on how to promote/market these apps. And this goes on a loop. So I was looking for people with a proper business case. While I learn a lot building these apps, I figured it will be more useful if I can build it with some purpose.
patrickxie
can you drop your contact info in your profile so that we can contact you? We do amazon reselling, interested in learning more about the reseller site you are working on. Also have tools that we are looking to build ourselves (we will pay for), that other sellers like us are interested in paying to use as well.
digitaltrees
There is a lot to running a business beyond the first MVP and customer. Being a cofounder is as intense if not more intense than being married. I would almost flip it around so you take a 20% passive stake with an priority to a dividend or a royalty on revenue so that you aren’t expected to manage multiple companies as a “founder”.

I am assuming that you are trying to get multiple ideas off the ground.

esquire_900
Multiple ideas - maybe, totally depends on what comes up. Though it would change the intention of the deal, flipping around the deal wouldn't be something I'd say no to right away. It's a proposition after all, not a ridged set of rules we have to follow :)

Got anything in mind?

digitaltrees
I have a list of 40 ideas that I don’t have time to build. Ideas are easy. MVPs seem easy in theory, iteration to find product market fit; that is hard. Execution and building a team after product market fit is harder. That’s where most the work is.

All of this is why a brand new founder seems like a novice when they are very secretive about an idea or want an NDA; ideas are easy. In reality, executing on an idea depends on domain expertise, which most developers, investors, random people you tell your don’t have, and know they don’t have. And most people know following through on an idea is a lot of work — they aren’t that interested in the hassle.

Paul Graham used to give ideas to founders for free.

I would suggest spending more time developing an analytical framework to identify problems. Don’t think in terms of “ideas”. Think I terms of a problem faced by an actual customer or user.

My favorite framework comes from Aaron Harris. He says you should find a customer that has their hair on fire because a prototype fire extinguisher would solve a very serious problem for them. They wont care how basic, ugly, broken, or unreliable your fire extinguisher is and won’t care what price youre asking; they want to put out the fire.

zzzcpan
Maybe the OP is trying to find problems, ideas that fit his unique skills and expertise to execute, and wants a little bit of help to validate.
gesman
Short version:

I'll buy 80% of your idea for $500.

In case first customer(s) will ever come - i'll give you another $1,500.

Not clear: if no customer(s) will ever come after X days - who owns the idea?

esquire_900
Thanks for your point. There are a lot of details which need to be discussed but depend on the idea, clients, product type, implementation etc. Ownership and exact targets being one of them.
ryanmarsh
Shit I’ll pay you $10k and only keep 10%. Finding real life problems that (truly) require a (tenable) software fix are getting harder and harder to find.
patrickxie
what's your contact info, I am experiencing problems in Amazon reselling space that we need solutions for, but no time to build. We might be able to work together, can you drop your contact in your profile.
so_tired
I will take it ;)

Are u a FE coder by any chance? Or a marketing/growth guy. I am in backend/algo so any mobile/browser-related dependency becomes a blocker for me. Sigh.

B2C, paid product, well differentiated, plenty of demand.

Drop me a line at sdjhsdfjkhkjsdf@maildrop.cc (disposable, 24hrs, messages may be read by others)

ryanmarsh
Full stack. I’ve forgotten more frameworks than most care to ever learn.
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so_tired
Hey. Sounds great. I didnt see any incoming messages, so maybe it was deleted.

Please re-send contact details to D-56dm11pzbsa@maildrop.cc (this is a secure alias. Other people will not be able to see messages. )

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tluyben2
Yep agreed; I think there is a good opportunity here for full stack devs that have the luxury of at least time to help people out and perhaps create a cool product and company based on software skills. Which is increasingly rare indeed.

I started several companies on this basis and because it has become harder I focused on networking, investor relations and business skills, so now I can offer angel, series A (and higher), business development and development skills in exchange for a %. I think teaming up with another full stack and then doing this would be the next logical step. If someone is interested, either with an idea or skills, contact me (see profile).

gesman
I had this idea to build social network where people could share photos with friends.

Where I can pick up my $500?

esquire_900
Let's use ad's and stuff! It's going to be huuuuge!
thrill
Only pictures of people when drunk - we'll call it FacedLook.
ykevinator
Anyone in the u.s. doing this? I'd be willing to give up 50% equity and no cash for what I think is an awesome idea.
crawfordcomeaux
My idea is to build a digital giving economy. You get to keep 100% of everything given to you through the site. If successful, you can retire comfortably with little money while being held by the giving community and go forward in a life of service, if you so choose.

As the site produces no money, you can keep 100% of all revenue.

jl2718
I love building. I’d do an MVP for much less equity if I’d actually get it. But I won’t. One of my MVPs turned into a $500M acquisition. Got $0.

This is normal in Silicon Valley. So many unicorns hiding skeletons of enthusiastic side-project coders.

I’d say don’t do it, but... to be honest, I never could have hyped my own prototype the way they did. I didn’t have the rich kid VC connections that they did. And I needed my day job. So really I lost nothing. At least I got the story.

whitepoplar
Are you able to mention the company, either publicly or privately?
UweSchmidt
Whatever happened was probably entirely legal and probably ethical as well.

You can be a cofounder, and have ownership even if there is a lack of contracts and paperwork, and that likely would have come up during that $500M acquisition. I can't find it, but there was a Ycombinator - backed startup whose sale was blocked by a founder who went AWOL early.

If he was an employee, or did otherwise hand over / accept compensation for his work, well, that's just business as usual: employees generating wealth for owners.

The lesson is to have clarity of what you want out of a certain work, and then have some kind of contract, before you start working.

jl2718
Well, I never have, but, life is short, and this was long ago, so... Skybox.
esquire_900
Sorry to hear about your experience. That's one of the main things that puts me off about the current startup/VC relationship.

I am not a Silicon Valley kid though, don't want to be, and this isn't going to be a unicorn.

avinium
> At least I got the story.

Would you mind sharing?

jl2718
Oh boy... Well, doesn't do me any good, so never before told, but I guess I only have so many stories to tell before I get hit by a bus, so... Briefly:

2007-2009 Satellite project at Stanford. Very modest capabilities. Prof had idea. Design and operating system by adjunct. Hardware by LMT volunteer (the real hero). I, also volunteer, wrote control software, did radiation testing at UCD LinAc. Bunch of students too. Then deployed to Afghanistan, heard nothing. Came back 3 years later, went to random meetup: person I've never seen presenting talk about founding company with brilliant undergrad who built a tiny satellite that could read license plates from space. Wait... what? Oh that guy. Hmmm... well, I wouldn't have done it, but hey, the pitch worked. $100M funding... wow. $500M acquisition by Google... eyes wide open. AFAIK, others not involved. Hope HW hero got something: quiet, humble, fast, obsessive, helpful, learned so much from him, but seems to have disappeared.

arisAlexis
I have a similar story.I guess there are many of us
so_tired
Weird that someone there doesnt throw u a $100K acquisition bonus just for good karma...

If u think u would enjoy gradually building a B2C product drop me a line. Maybe i can hook on u on a better story...

B2C, paid product, well differentiated, plenty of demand.

sdjhsdfjkhkjsdf@maildrop.cc (disposable, 24hrs, messages may be read by others)

alicoche
! I have a couple Ideas both a wedding subcontractor platform...and mindfullness reminder app.

As for the wedding platform , I even have the people who would be available to signup as sub-contractors.

Venues could signup we get a percentage for advertisement we handle all payment processing, hmu if you are interested working together.

esquire_900
Sounds like something that might have potential! (the subcontractor idea, the mindfulness reminder is something you can't really monetize and most likely exists already)

Any experience in the wedding subcontractor field? I'd love to discuss some idea's if you like (email in profile)!

fxfan
Can you clarify how much equity you want. 80% sounds too high sorry but its not very clear.
tluyben2
Seems much confusion about this; 80% would be a weird deal so I assumed 20%.
[dead] hnsukas
I hope it does not include shadow banning. Like current
gus_massa
Why are you using a different account than in the version [1]?

Edit: Now I understand. Version 1 was made by another user.

dvt
This proposition's assumption is that there's something special about ideas. Reminds me of the kind of person that might make you sign an NDA before telling you a "cool idea I had last night." It's no secret that YC -- like basically all incubators -- invests in people, not ideas. Teams will sometimes fumble for years before they find product-market fit.

There are no shortcuts.

elpakal
Great point. I give the author of this post props for trying this and it has been an entertaining proposition. But to me premise 2 is admitting there will be massive shortcuts taken here. There is now way one person could build a product that would scale as well as a product made by an entire team. You might be able to get it about 90% there, but the last 10% is the hardest IMHO.

In my experience this kind of rationale is what leads to MVPs being spun out quickly using hybrid tools which have a hard time scaling. Sure it kinda looks like the real deal, but the product will limit the growth potential of your company.

zzzcpan
There are plenty of products/services built by a single person that only hired more people once they were able to afford it and needed it. This is especially common when access to VC funding is pretty much non-existent and you can't just hire a bunch of people.
esquire_900
I'd much rather be in the position of having too much demand for a badly build piece of software then an awesome team, VC funds and a beautiful Elixir architecture with no demand.

Reminds me of this post [1] that hit the top pages yesterday. It's actually the anti-example for my argument, but the way software runs in the real world. Apparently it's commercially more interesting to run cr*p, even if that gives rise to a significant probability of costing you $172k a second.

I think the first sell is special, the idea just leads you there.

[1] https://sweetness.hmmz.org/2013-10-22-how-to-lose-172222-a-s...