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Re: Don't make the IT guy your business partner
Moderator Cath Mar 10, 2014 1:53 PM (in response to chicagocio)Oh chicagocio, I'll bet you have a lot of people really thinking now about decisions, past and perhaps in the making right now!
One thing I would suggest and I'm sure this is not brand new for anyone, but when you enter into any agreement in business, be sure to have all your bullet points written down and signed by both parties. So often we talk about a point and then just expect that the other party, by saying noting or agreeing is truly agreeing. Get it written AND signed!
Clear expectations help make a collaboration so much smoother and happier for both parties.
What does everyone out there think? Do you agree? Disagree? Want to add something? Please do.
Cath
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Re: Don't make the IT guy your business partner
chicagocio Mar 12, 2014 12:28 AM (in response to Moderator Cath)I see this kind of thing happen all the time. And the really screwed up part is that many startups don't realize that the IT guy is only there for them until he or she gets a job or a better job. And then just like that whatever software project they were in the middle of comes to a complete halt. As with any business partner, very careful thought should be given as to whether this person is really committed to being owner for the indefinite future, being the right fit, etc. I have tried to convince people not go this route, but the lure of free labor is too irresistable but there's no free lunch. As for a written agreement I never do any work at all without a detailed agreement. Just not good business otherwise.
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Re: Don't make the IT guy your business partner
Ryan Viola Mar 11, 2014 7:01 AM (in response to chicagocio)All people are not same, but need to find real people.
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Re: Don't make the IT guy your business partner
Moderator Melinda Mar 16, 2014 9:33 AM (in response to chicagocio)What a great topic! I bet this is the number one mistake many people make. You actually answered a very long time question that I had and couldn't figure out exactly what happened with my own site. I guess my partner (not the IT guy) didn't have the nerve to tell me that this situation took place and that is how we legally lost our site.
Thank you for shedding some light on years of darkness. I bet you also helped out someone who may be in this same situation or maybe thinking about it.
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Re: Don't make the IT guy your business partner
chicagocio Mar 17, 2014 6:45 PM (in response to Moderator Melinda)I hope that it does. Right now I am working with a charity organization and they run the same risks if they don't get legal help to make sure the IT volunteers that develop their site are giving up their intellectual property rights to code.
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Re: Don't make the IT guy your business partner
Moderator Melinda Mar 18, 2014 9:06 AM (in response to chicagocio)Just out of curiosity, Chicagocio, how long has this law been in effect? I lost my website in 2007.
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Re: Don't make the IT guy your business partner
chicagocio Mar 18, 2014 6:56 PM (in response to Moderator Melinda)Well it's basically copyright law that gives ownership to the author of the work and technically graphic design and software coding are considered literary works. The exception to this rule is the "work for hire" which is part of our copyright law and gives legal ownership to the employer.
Here's a link with background information on it:
Work for hire - Wikipedia, the free encyclopedia
I am not a legal expert on it. As a CIO, I am aware of copyright law, and I've done my own research on it back in the days of being a freelance software developer. But I also know that the law can be a bit tricky so sometimes I have to consult a lawyer. But I do know that without compensation there is no employer / employee relationship and without that you can't benefit from the "work for hire" clause in U.S copyright law.
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Re: Don't make the IT guy your business partner
Moderator Melinda Mar 19, 2014 1:18 PM (in response to chicagocio)I really appreciate your information and I know that others will benefit from this information as well.
Thank you.
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I get this all the time: "Hey we have this infallible business idea, it's going to make us rich but I am looking for a partner who can build the website."
So by "partner", what they really mean is someone they don't have to pay. I used to get caught up in these "opportunities" all the time. Truth is they are just bad ideas for the IT professional. But lately I've been thinking they are bad for the business person too.
Look at it this way. Let's say you need someone to program a prototype web site. Quotes from vendors run at 10K. So you say "Sheesh! That's a lot of money to commit up front. Why don't I just give the person a revenue stream if the site is successful?"
- First, if you don't pay you don't have the "Work for Hire" clause that helps business owners intellectually own the custom software for which they paid. So the legal side of this just got harder. He or she owns that work by default if you didn't pay for it.
- What if the site generates 250K or more in revenues? How much will you be committing to the person who programmed it? Probably a whole lot more than the 10K. And remember you don't just commit money, but decision making for the business as a whole because this person is a partner after all. So basically bringing on an IT person as partner is a great idea if you expect things to fail. But really costly if you expect to do well.
- Where's the real value here anyway? Is it in the coding?? No it's in the idea. Your idea. A computer programmer is just another skilled individual whose work you can profit from. You won't give pieces of your business away to the person who cleans your office, sets up your phone lines, or files for your LLC, so why give it away to the person who codes your software?
If you believe you have a great idea. Then own it. Pay for someone to develop it and then it's yours for whatever potential value it has. Isn't that what being an entrepreneur is all about??