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Estimating the value of a db

I Started working on a db I'm building as a hobbie, However it has
turned into quite a project. I have copyrighted it just incase. Now I'm
wondering How do I assess its value if I wanted to sell it? Is it worth
a can of Coke or a pound of coke. How do I establish which? Should I
sell the whole thing outright or license it? Ahhh Questions, Questions,
Questions. And all this because I wanted to count noses better.

S. Graefner

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Nov 13 '05 #1
3 1149
Stewart, this is the rule of thumb I use.

Generally, a client asks for a specific DB just for their purposes: If this
is the case they have 3 choices.

1. They can pay per computer.
2. They can buy the rights to modify the DB with the code so they can modify
it themselves without any more of my input. This is usually done in case
something happens to me and I cant work on the database for some reason, or
they want to hire someone else to do the work.
3. They buy all the database rights including the the rights to sell it.

In scenario 1, you have to determine what kind of sales you will get (on a
per licence basis) and judge how long it took you to write and how long it
will take for you to be compensated for your efforts. (Remeber, if you
spend 10 hours trying to figure something out, dont count that as 10 hours
of paid labour. Just count it as is you already knew how to do what you
were trying to do and judge how much ACTUAL time it would have taken you to
produce. Clients should not pay for your inability to do what they need.
They are paying for your expertise.)

In scenario 2, you can sell the rights to an office Location (all computers
at one site, or all computers owned by the company...its up to you). You
still have to know what the potential market is in order to figure out a
price and value of your product). I just finished a database for myself.
It took me 150 hours to write. If I billed my current rate of $100/hr. My
client would have to pay $15,000 for my database. But to them they can get
an off-the-sheft product with fewer features for $500. So I could not
charge too much for it because the customer would simply take the store
bought version with fewer features because of the huge price difference.
When I do a database for a client, I dont charge by the hour, I put a price
(cap) on the product. No one will pay an hourly rate to develop a custom
database...if they do...give me their number. :-) Just remember, they get
to use your app on as many computers as they own...so price it using model
1.

In scenario 3, you are selling them ALL RIGHTS... this inlcudes the rights
to sell the database SINCE YOU DONT OWN ANY OF IT!!! Therefore, yo cannot
resell it again because it is not your property. For this case I usually
triple my company fee. I don't usually sell the database outright for 2
reasons. Clients don't usually want to sell the product and 2, if the
market potential is good enough that the company can make money off your DB
then you should be able to do the same!!! The majority of my clients go
with Scenario 2.

I know the pricing aspect of this is a little vague, but I can't put a price
on your DB because I don't know what market its for, the size of the market,
and the market status. So, I hope this can point you in the right
direction.

HTH
Paul

"Stewart Graefner" <gr*******@hotmail.com> wrote in message
news:41**********************@news.newsgroups.ws.. .
I Started working on a db I'm building as a hobbie, However it has
turned into quite a project. I have copyrighted it just incase. Now I'm
wondering How do I assess its value if I wanted to sell it? Is it worth
a can of Coke or a pound of coke. How do I establish which? Should I
sell the whole thing outright or license it? Ahhh Questions, Questions,
Questions. And all this because I wanted to count noses better.

S. Graefner

*** Sent via Developersdex http://www.developersdex.com ***
Don't just participate in USENET...get rewarded for it!

Nov 13 '05 #2
Paul, Thanks for your response, it was very helpful. I will try to
better define the db's use for you. It's for a Government org. It would
be very exclusive in its use, Maybe 60 computers, there is currently
nothing else available that matches it's Total capability. There are
different locally produced versions of the theme but nothing that "does
it all", this db does it or as close to "all" as I currently understand
all the requirements. This db was developed to standardize procedures
fro the intake of personnel and to track all their relevant data
including updating training requirements and much more. I discussions
with the users of a beta version they have told me it saves them many
hours of work each day which translates to hundreds possibly thousands
of hours a year. Multiply that by the 24 expected units that I believe
would use this product the savings to the Gov can be substantial.
I hope this gives you a better understanding of what I'm looking at.
Thanks again,
S. Graefner
*** Sent via Developersdex http://www.developersdex.com ***
Don't just participate in USENET...get rewarded for it!
Nov 13 '05 #3
I did not give you a selling price.

Use the information I supplied to help you determine what you want for the
database.

In the end, its your work and its up to you.

Just make the price the right price. Think about how much they need YOUR
application and NOT someone elses. Then figure out how much they would pay
for the product (figuring in the time you will save them...and prove it to
them in black and white!!!) If you do a good job you should be able to
convince them that they can re-coop their expenses in a short period of
time.

Go from there.

Paul

"Stewart Graefner" <gr*******@hotmail.com> wrote in message
news:41**********************@news.newsgroups.ws.. .
Paul, Thanks for your response, it was very helpful. I will try to
better define the db's use for you. It's for a Government org. It would
be very exclusive in its use, Maybe 60 computers, there is currently
nothing else available that matches it's Total capability. There are
different locally produced versions of the theme but nothing that "does
it all", this db does it or as close to "all" as I currently understand
all the requirements. This db was developed to standardize procedures
fro the intake of personnel and to track all their relevant data
including updating training requirements and much more. I discussions
with the users of a beta version they have told me it saves them many
hours of work each day which translates to hundreds possibly thousands
of hours a year. Multiply that by the 24 expected units that I believe
would use this product the savings to the Gov can be substantial.
I hope this gives you a better understanding of what I'm looking at.
Thanks again,
S. Graefner
*** Sent via Developersdex http://www.developersdex.com ***
Don't just participate in USENET...get rewarded for it!

Nov 13 '05 #4

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