1) Are there many rails programmers willing to work for an early stage start-up on an equity basis? Whats a reasonable percentage of ownership? (15, 20, 30%)
If your idea and your business plan are solid, you should be able to find someone. As Toby mentioned, most developers have been burned by the "equity-only" promise. My company is constantly approached by people who want us to invest in their company for a stake. You may have to kick in some funding as well.
I am involved with a start-up and chose Rails as the best platform for the job. My business partner (an old friend I trust) came to me with an idea and 50% on the table. We outlined each of our responsibilities, time-lines, financial projections, and the overall vision of the project.
50% is a lot to give away, but you have to know how much you can do on your own and how much you can't. I am now a long term partner of the company. As our company grows, there will be more and more share divisions to bring on the right dedicated visionaries and/or investors into play to sustain the growth of our company.
I'm not saying 50% is the right number (it may or may not be). Determine how much you are willing to invest in one developer. Are they a leader down the road? In charge of the technical direction of the company for the years to come? Adaptable to change? Etc.
Another example, I have an acquaintance who helped brand Rocky Mountain Soap for 6% of the company stock. That doesn't sound like much but as time went by and the company has grown it has worked in her favour. Last year their revenue for 2006 was CAD $3.5 million. This case is different because she is not involved with the company on a daily basis - just the one job to brand the company and do some packaging.
At the end of the day there are only two questions to ask:
1. Am I hiring someone just to get my idea of the ground?
2. Am I looking for a long-term business partner?
If your looking for #1, get some money/funding together and hire. If your looking for #2, start making some relationships with Rails developers and get to know them and how they work. If you can find developers in your own city, take them for coffee and chat (not necessarily about your project). #2 definitely requires much more than a resume.
Last edited by Ignition (2008-04-24 11:24:25)