How much for my code?

New vTvV46
Mar 14 19 Comments

I have spent about 6 years perfecting the workflows and development of something.

My tools and frameworks are quite small, about 3000 lines of code in total. But there is a lot of planning and optimization going into these tools.

A fairly small US based company with about 8 employees reached out to me and asked if I could:

A) Do consultation to help them scale their production to the next level.

B) Sell my tools and frameworks to them.

I am currently freelancing with rates around $80 - $100 per hour (I am in Europe so the rates are high).

I’m trying to figure out how much I should sell these tools for. I feel okay with selling it for the development time it would take me to build the tools today: about 86 hours to rebuild it all with the knowledge I have today. If I charge $80/h that would be $6880 one time fee.

I have myself profited a lot already from these tools because they helped me to save time in freelance work.

What do you guys think?

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TOP 19 Comments
  • Uber
    Thumper

    Uber

    PRE
    Google
    Thumpermore
    Are you selling the code and all rights to its use? If so, I'd recommend that you change the contract. Better to sell binaries and non exclusive licenses. That way you can profit further.
    Mar 141
    • New vTvV46
      OP
      Thanks! I’ll go with a license and binary/ minified files!
      Mar 14
  • New / Eng
    errfileno

    NewEng

    PRE
    Microsoft
    BIO
    Senior Software Engineer. 15yoe. Seattle. $205k TC
    errfilenomore
    Price not on the hours put in, but by the value the tool provides.

    Can your tools be implemented to run as a service? Can you charge a somewhat low but recurring fee for continued access and support of said service? Can you do so with multiple clients simultaneously without scaling your overhead linearly? SaaS companies practically print money.
    Mar 142
    • New vTvV46
      OP
      Think of the tools as a set of automations for processing images (in a bit unique way).

      And the second part of the tool is just a JavaScript library / framework.

      I doubt I can have it as a service. The library needs to be on their server (can’t be cross domain).
      Mar 14
    • New vTvV46
      OP
      I could definitely sell this to multiple companies.
      Mar 14
  • Amazon Chinese
    I will encourage you to think from what value does the tool bring it to the company rather than how much effort you have put in building these tools. How much the company can afford to pay you? Also, keep in mind - what kind of support would they need after wards? You may include that in your quote or explicitly call that I will support it for X hours/Y days.

    Are you also selling them the rights to redistribute these tools?

    Another point to consider- when you sell it to them offer them other tools that can help them improve their productivity.
    Mar 141
    • New vTvV46
      OP
      I’d say I could make their production about 15-25% more time effective and overall raise the quality of their production.
      Mar 14
  • Twitter Oomnj
    You need to add a ‘Value layer’ on top of your code. No need to sell the code directly. Build it into a tool that’s easy to use and deploy and license the usage of the tool with a price structure based around the use and length of use.

    The more value you add on top of your code, the higher you can sell it for
    Mar 140
  • Uber C H O N K
    By sale, you mean license, right?
    Mar 140
  • New vTvV46
    OP
    A license so that they can use it in their everyday work. I was at first thinking to share the entire source code but now I realize that binaries / minified will be smarter.

    As someone mentioned above, that way I get to support them x hours. I don’t think they will need much support but I would expect 4-8 hours per month.

    I don’t want them to redistribute the code AT ALL but they work with a large fleet of freelancers that would all need access to these binary / minified files.

    There is a list of 5 tools and all kind of complement each other but are independent.
    Mar 142
    • New / Eng
      errfileno

      NewEng

      PRE
      Microsoft
      BIO
      Senior Software Engineer. 15yoe. Seattle. $205k TC
      errfilenomore
      Charge per user per month for access, and build your tools in such a way that they are either centrally hosted or require cryptographically-signed license files to operate. Have price-per-tool and a higher package price that is low enough that anyone in their right mind would pick it instead of paying for individual tools.
      Mar 14
    • New vTvV46
      OP
      For 1 of the tools I think I can do that! I actually might turn this into a product...

      For 4 of the tools, the script files can’t be loaded cross-domain. They need to have the files on their server for it to work.
      Mar 14
  • Facebook ra37cbaufh
    I worked for a company that and we asked this question from the other side: how much would it cost us to build it? Let's say 3 engineers for 1 year. So we were willing to to buy it ) for 3 * eng salary.

    But I do agree with others that you should do a subscription model . I'm not sure about that
    Mar 140
  • Oracle stuffed🦄
    Set up a license check with an expiration date lockout, bill on a recurring cycle. The single time purchase price should be barely less than however much it would cost them to build it on their own, plus however much they value not having the hassle of another project. Estimate single time purchase worth based on what you know of their skill level with respect to your project, strength of learning culture, and personnel cost. For how to spread this across repeating payments, look up math around the word "annuity" and then weigh in switching costs away from your project.

    Better yet, find a freelancer with experience in pricing to do this for you the right way. Then also make a small ad budget, and start slowly growing your sales beyond the one company until it's justified to pay a marketer to push this
    Mar 140
  • New vTvV46
    OP
    Is there any way to check how much revenue a company has per year in US?
    Mar 142
    • New / Eng
      errfileno

      NewEng

      PRE
      Microsoft
      BIO
      Senior Software Engineer. 15yoe. Seattle. $205k TC
      errfilenomore
      Publicly-traded companies are required to report this quarterly. Privately-held companies are not.
      Mar 14
    • New vTvV46
      OP
      It’s private but according to Crunchbase their annual revenue is $8.1M
      Mar 14
  • Google Woopsy
    I would sell them a yearly license for the cost for you to build it as a minimum: better on the long term.
    But as other mention: price of things is not about cost, it is about how much they are ready to pay for it. You need to know what are the alternatives for them (BATNA).
    Mar 140
  • New
    EMVH32

    New

    PRE
    Amazon
    EMVH32more
    Dm me.
    Mar 140

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