Ask HN: My company wants to build a tool. I want to build it as a SaaS business | Hacker News Reader

Ask HN: My company wants to build a tool. I want to build it as a SaaS business

1 pointthrowaway129835 comments

I'm an engineer at a small non-tech company. I noticed that our process could be improved if we automated X. Two months ago, I cut down to part-time, so that I could work on validating this, with the intent of turning it into a SaaS business if it looked promising. I learned from talking with other companies that while this is a small problem, many companies have it and would be willing to pay for an off the shelf solution.

I was planning on doing more research, when our PM mentioned to me that we would be building this tool in-house. Apparently one of our clients offered us $50,000 to build the tool, because the automation improvement would save them quite a bit of money. This tool is not related to our core business, and I don't believe my company would build it in-house, if this client hadn't offer us $50,000.Nobody at the company is aware that I am working on this problem, but I need to determine how to proceed before the team starts on building this tool.

My current plan is to chat with the PM, and tell him/her I would like to build it and eventually sell it to the company at $XXX/mo. This arrangement would benefit my company, because they could have a lot of influence over the solution I build, but would only have to pay me $XXX/mo once the solution is complete. At that point, they could take the $50,000 from their client, and pocket the savings. The arrangement would benefit me because I would have a first customer before I start building, and it would help me launch my company/service.

Are there any problems with going this route? Is there a better way to handle this situation? On the legal side of things, is there anything I should be looking into? I would talk to a lawyer if my company agrees to this arrangement, since I'd like to figure out a way to prevent my company from saying 6 months from now that they own this service that I built. Any advice would be greatly appreciated! Thanks HN!

If the company has full-time employees (ie, it’s big enough to pay salaries) and is already considering building it, the “I’ll save them money building it” value proposition doesn’t seem very compelling.

If you’re really committed to this, convince them you’ll run and grow it bigger than they would internally - probably by being able to raise outside capital for it with them as a significant shareholder (alongside the VCs and you and this PM as founders). Tie your compensation to success - which means equity, not salary (at least until you’ve raised new capital). Get the PM onboard.

I think the odds of that working are still low, but “You have a shot at owning 30% of something valued at, and exiting for, millions” is at least interesting and would be hard to execute internally.

You're probably right about the money saving value proposition... the flexibility to customize the service in-house may outweigh cost savings.

I'm not really sure how convincing them I will grow this to something big is relevant. It's a very niche service that isn't something my employer would be interested in making money off of. They do not intend to sell the tool they are thinking about building in house. I am financially independent and would like to bootstrap this business, so I have no interest in bringing in VCs. Even if I did, it's such a niche problem that no VC would be interested, unless I sold the problem as a gateway into a much bigger and more profitable domain. I don't really have any interest in this though.

> how to proceed before the team starts on building this tool.

So far, neither you nor your company have built anything.

Relative to the Market opportunity. This platform could be a nice new line-of-business for your firm with the potential for a carve out down the road. Build your business case and pitch the CEO on the Big Idea.

Incidentally, worth checking if that $50K seed money comes with any restrictions. Obvious, conflict of interest if future potential customers are his direct competitors.

Without giving away too much information, due to my company's financial backing and long-term goal(s), I'm very doubtful that this is something they would be looking to build and sell, or invest in (outside of their use case).

Good point about checking for strings attached to the seed money though, I don't know off the top of my head but will need to find out.

The whole aura of your post is long-winded, yes, but also kinda douchey. Either cut all ties with your part-time employer, or work on what your employer tells you. Don't try to extract $XXX/mo or claim IP while remaining on their payroll.

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