We have been developing mobile apps and games for 7 years now. We're in Iran and started by accepting mobile projects from UK as an agency and then switched to our own startup projects. 3 years ago we've released a social mobile game and it was a huge success compared to mobile market size in Iran. It had a ROI in two month and is generating revenue supporting a team of 14 to develop the game and another game project. Startup ecosystem is very trendy in Iran and almost every university tech graduate thinks of having his own startup. On the other hand, Since almost every employee in my company has an idea of how much revenue the product generates, I recently received a few feedbacks from a few key employees that they are not satisfied working on a project that doesn't have long term benefits for them. (i.e. I hear that, assuming we release the second product and company revenue doubles, what would it have for me as an employee?). I've studied that the only incentive for employee to stay in a company is not monetary. So we've created a friendly environment and flat structure for the work in which every one has a potential of huge impact on the product design and development. But we also would like to fix the monetary side. I searched a lot about employee incentive and profit sharing plans. I see the practical way companies do the profit sharing is through Employee stock options. Once considering this path, I faced a problem which tech company stocks in Iran are not liquid as they are in Silicon Valley, also a standard technology company valuation service doesn't exist here. It's very common to invest-in or purchase an startup there which is not the case here. So having stock options would not work practically for the employees they would not be able to sell it. We then thought on an income sharing plan which I describe as follows: 1. we defined a fixed percentage for every employee based on their role and experience (say 0.5% for an advanced employee) 2. They would be able to increase their percentage by going through a predefined improvement task list. 3. Those employees who select this plan, will receive (a lower hourly wage + company_income x percentage) monthly 4. New employees get lower percentages base on the current income/ current stage of the company In such a plan if all employees choose to switch to profit sharing plan, we would give around 12% of company income to the employees, monthly. They would be assured to receive it and it would not have depend on our expense decisions. Since I did find a similar case on the net (income sharing) I fear the plan might have major problems that I don't see. I would be glad to have your advice and perspective on this.
It always comes down to taxes. What is your goal? Save on taxes? if it is then profit sharing is a must. Making the company employee owned gives a huge tax break, while giving out equity forces to you and your employees to submit that as assets at the end of each year, while corporate team has submit an evaluation form to the IRS for any adjustments, issues, or stock hikes or drops.
Equity keeps employees for longer, but so do 'bonuses' so answer should be based off tax benefits.
Stick with income sharing as long as they are employed. If they leave they have to take a much smaller stock option.
I am not trying to sell you on calling me. Really, I am pretty busy with my businesses and consulting. However, I need more info before I could have a greater impact in helping you.
Ask, Ask, Ask, then Ask again.
Here is $10,000 worth of information for free and in a nutshell.
Concentrate on the 3 M's. There are actually 7, but 3 will do for now. These are Market, Message, and Media. They come in that order.
Who is your target market (customer, clients, buyers, users, etc.)?
Tailor your laser focused message for this target market.
What is the best media mix to get your message to that market?
Here's what you do...first, make it an offer that is so incredible that they cannot resist. Secondly, do all the work for them. Make it so easy to make the purchase now that they can do it virtually without effort. Thirdly, give them an incentive to act right now. Fourthly, offer an almost unbelievable guarantee. Fifth, offer a bonus for acting now. There are many other incredible steps, but these steps should help the novice to the professional sell anything.
Whether you are selling B2B or B2C, you have to focus on selling to only one person. You can actually sell to one person at a time while selling to millions at a time. They are one and the same. Don't get off track, what we call digital marketing selling is just selling in print. And that has not changed since Cluade Hopkins wrote "Scientific Advertising." Really long before he wrote the book.
The secret to success: I have had the pleasure of knowing and working with some of the biggest names in business, celebrities, actors, entrepreneurs, business people, and companies from startup to billion dollar operations. The number one reason for their success is doing what they know and love while doing it in new, creative, and innovative ways.
Ask, Ask, Ask. Have thick skin and learn from each "mistake." In a short while, the market will tell you what you need to do and who and what you need to ask. But get started now even if that just means asking a contact on LinkedIn.
While you are thinking, think big and think of something at least 1% better, newer, or different. And being cheaper is not a winning strategy.
Make decisions quickly and change decisions slowly..unless you are actually going off a cliff.
Remember these two 11 letter words...persistence and consistency. They are two of the most important tools ever invented.
Treat everybody you talk to and everybody you meet (including yourself) like each is your number one million dollar customer.
Bootstrap when possible and reasonable. Read "How To Get Rich" by Felix Dennis. Or better yet just remember the camel's nose in the tent story.
However, sometimes you just need to make a deal.
Listen, in any business you have to take some chances and some risks. Make sure you don't need a license and go for it. Remember, timid business people have skinny kids. Paraphrased from Zig Ziglar.
Best of luck,
Take massive action and never give up.
Michael Irvin, MBA, RN