Burned by Developers – Two Entrepreneurs share their Stories
It’s no secret South Africa has a shortage of software developers, and that developers are one of the most in-demand professionals in the country.
IT professionals and software developers have a role to play in helping entrepreneurs to build their tech solutions, however for every entrepreneur who can credits a software developer for making their dreams come reality, there are many who can tell tales of being ripped off.
Two entrepreneurs share their experiences – Brian Makwaiba is the founder of Vuleka, a platform which helps to facilitate bulk purchases of goods sold by township-based businesses; and Ndzalo Mpangana founder of Oyah, an app which connects users to events that suit their interest.
Make it clear that you own the IP
Please share with us your experience with software developers
‘Changing terms’ – We entered into an agreement with developers where they quoted for development of our mobile app as well as monthly maintenance, all was going well until the app started gaining popularity, we won some awards for it and started getting some radio and TV attention.
The developers then decided that the app was worth more than they quoted and they wanted a percentage ownership, we refused and they essentially held the app hostage. We have since severed ties with them. – Brian Makwaiba
‘Inexperienced’ – I got inexperienced developers straight out of varsity so they had to learn to build an app with my idea and that took a very long time and we burned a lot of money and wasted a lot of time.
I had made a deal with the two developers that I would pay them as soon as we started making money. I renegotiated an equity deal when I saw that the project was taking longer than expected and that’s when they wanted half of my business at the time. A very heavy price for a partnership that was filled with them overpromising and underdelivering – not meeting deadlines agreed upon. When the project started gaining momentum they demanded half of the company or [payment of] an exuberant backdated invoice [which was] inflated. – Ndzalo Mpangana
What’s the biggest lesson you took from the experience?
‘Get everything in writing’ – The importance of having proper legal documents signed with developers, outlining all parameters of the agreement. – Brian Makwaiba
‘Clear expectations’ – To clearly define the relationship before you start working. Are the developers part of the founding team with equity in the startup? Are you going to pay them per milestone, how much will it cost and how do they want the payment. Make it clear that you own the IP. – Ndzalo Mpangana
How do you now source developers for a project?
‘Check credentials’ – We have the option to pay an extra fee at a company that vets developers first, they handle the agreements and manage the developers OR to get our own in-house developers that work for us to avoid all of this. – Brian Makwaiba
‘Check references’ – I get references from other non-technical founders who got their project done by developers. That’s the best way. Very expensive if they are not part of the startup. – Ndzalo Mpangana