Joint Venture Web Development
I’ve been noticing a trend for larger projects that have been coming to us lately. A surprising number of long term clients as well as new customers want to formally partner and work together to build web applications. I’ve had several conversations turn to creating a joint venture LLC or a cooperative agreement early on. We regularly get 3-4 of these a year but in the last 6 months, I’ve had at least 8 joint venture opportunities of one kind or another pass my desk.
What does this kind of arrangement do?
For our clients a joint venture can:
- Reduce financial risk by lowering up front development costs – ArcStone bears a proportionate amount of the expense.
- Give the project a jump start – sometimes we can we inject proprietary software into the partnership.
- Eliminate the need for our clients to hire any initial, dedicated technical employees.
Joint ventures benefit ArcStone by:
- Providing an additional revenue stream and an avenue for discovering new consulting opportunities.
- Enables us to harvest some of the potential upside as the application becomes more successful.
- Allows us to exercise our entrepreneurial muscles (which is a ton of fun) – having started three other online spin-offs, AssociationsOnline, HOAWeb, and Wonderfile – we love the start-up!
Is this a sign of the times – are other web developers seeing this trend?
