RE: Innovation versus Industry

This discussion doesn't really belong on this list, but since you asked... You need to ask these kinds of questions. What is the value of your labor to date? Say $200 times 7500 hours = $1,500,000? What is the book value of 7% of the company's stock? What is the current market value of the stock being offered? How has the company's financial performance been and how has that affected its stock price. Waht are the total number of shares of this company and who are the other major stockholders? How liquid is the stock of this company? Can you trade now or do you have to wait? Is there any other opportunity to realize a cash flow from this investment? Do you want to participate in this company as a major shareholder and be part of the management team? With this size of holding you wouldn't be out of line to demand a seat on the Board of Directors. Could you leverage this investment into other career or investment opportunities? Don't discount the value of networking with other influential people. My basic advice is to make sure that current book value of 7% of this company is equal to your book value for the development of this software. Otherwise you risk just giving it away. Since this company is already public, your software is obviously key to their success. They need to lock it up so they can have a good story to sell to the public. You can be in the cat bird seat on this one. Apparently they didn't think this through until now and some of their investors are nervous about mission critical software not being in their sole control. For them to offer such a sizable chunk of the company, the other shareholders are willing to dilute their holdings. If you don't feel you can play this by yourself, get some good legal/investment advice. In my business we see guys like you get eaten up by these kinds of deals. Please watch out. ------------ David M. Davisson Pacific Financial Printing 650-328-1500 davisson@pfp.net > -----Original Message----- > From: owner-informix-list@iiug.org > [mailto:owner-informix-list@iiug.org]On Behalf Of M Timmins > Sent: Wednesday, July 28, 1999 6:41 PM > To: informix-list@iiug.org > Subject: Innovation versus Industry > > > Dear IEEE Collegues: > > I have an offer of 7 percent of a stable company (which is not presently > public) for my company's software. They have not invested in software > programming, have licensed my software for over three years and grown their > company, and now they want exclusive use. > > What should I consider? Over 7500 hours have gone into approximately 4-5 > major modules and 10 companion modules. > > Former student IEEE member ('79-'81) and current IEEE member, > > Larry Timmins > ftiadmin@fhb.clickcharge.com > ltimmins@ibs.clickcharge.com > 516-663-0426 > > >

Thanks David This software supports all three national credit bureaus and we have added support for a top credit reseller within three weeks recently so it is very mature, has handled over 200,000 applications (with average of 2.4 borrowers' credit reports per bureau), and then fully integrated with a web-based credit summary system that re-merges all data according to each client's and/or industry specific underwriting rules. As the software works with intranet, extranet and internet deployments (or all simultaneously), we've solved bring Internet business into a backoffice environment (using Informix-based DBI/DBD database applications (about 40 all told)) to give an edge to any customer. It just turns out that the client that currently represents about 98 percent of out revenue wants the exclusive edge for itself -- as you perceived -- because it doesn't own the technology it wants to go to market with. Regarding the value of the software (your estimate of $1,500,000) -- three peers of the customer spend between $4,500,000 to $15,000,000 to have 10 percent of their staff as software programmers and software maintainance programmers for their own exclusive proprietary software. They've sweetened the offer with a five year employment contract (and employment for my other developer). I guess we made our customer too successful, (in the third year of our business plan) just as we planned a September rollout for the many Year 2000 non-compliant banks and businesses that have credit software too old to work with the latest Year 2000 versions of data feeds from the national credit bureaus. Timing is another item in someone's favor. The offer for employment is only on for a few more weeks as they want to fill their "CTO" or similar position before presenting themselves for consideration (they are presently private). Thanks for the great ideas, cautions and thoughts. Larry Timmins 516-663-4026 David M. Davisson <davisson@emuni.com> wrote in message news:7npr5q$qu9$1@news.xmission.com... > > This discussion doesn't really belong on this list, but since you asked... You > need to ask these kinds of questions. What is the value of your labor to date? > Say $200 times 7500 hours = $1,500,000? What is the book value of 7% of the > company's stock? What is the current market value of the stock being offered? > How has the company's financial performance been and how has that affected its > stock price. Waht are the total number of shares of this company and who are > the other major stockholders? How liquid is the stock of this company? Can you > trade now or do you have to wait? Is there any other opportunity to realize a > cash flow from this investment? Do you want to participate in this company as a > major shareholder and be part of the management team? With this size of holding > you wouldn't be out of line to demand a seat on the Board of Directors. Could > you leverage this investment into other career or investment opportunities? > Don't discount the value of networking with other influential people. > > My basic advice is to make sure that current book value of 7% of this company is > equal to your book value for the development of this software. Otherwise you > risk just giving it away. Since this company is already public, your software > is obviously key to their success. They need to lock it up so they can have a > good story to sell to the public. You can be in the cat bird seat on this one. > Apparently they didn't think this through until now and some of their investors > are nervous about mission critical software not being in their sole control. > For them to offer such a sizable chunk of the company, the other shareholders > are willing to dilute their holdings. If you don't feel you can play this by > yourself, get some good legal/investment advice. > > In my business we see guys like you get eaten up by these kinds of deals. > Please watch out. > > ------------ > David M. Davisson > Pacific Financial Printing > 650-328-1500 > davisson@pfp.net > > > > -----Original Message----- > > From: owner-informix-list@iiug.org > > [mailto:owner-informix-list@iiug.org]On Behalf Of M Timmins > > Sent: Wednesday, July 28, 1999 6:41 PM > > To: informix-list@iiug.org > > Subject: Innovation versus Industry > > > > > > Dear IEEE Collegues: > > > > I have an offer of 7 percent of a stable company (which is not presently > > public) for my company's software. They have not invested in software > > programming, have licensed my software for over three years and grown their > > company, and now they want exclusive use. > > > > What should I consider? Over 7500 hours have gone into approximately 4-5 > > major modules and 10 companion modules. > > > > Former student IEEE member ('79-'81) and current IEEE member, > > > > Larry Timmins > > ftiadmin@fhb.clickcharge.com > > ltimmins@ibs.clickcharge.com > > 516-663-0426 > > > > > > > >