would like every VALIS customer to know that our business model is different
from most other software publishers in that we have a co-op
structure and are revenue funded. We represent talented independent
developers and share profits and accountability for their product's success.
That's right; no VC's, no stockholders; just us (two owners and the rest
subcontractors and developers and lawyers). The VALIS Group started out
as an experiment 6 years ago when we were set free due to a company downsizing.
We started our company
with the idea that developers are typically undervalued in companies. We
wanted to make the inventors profit sharing partners
instead of employees. So, instead of requiring ownership of source code,
we felt the ownership of the exclusive publishing rights of any product
derived from that code or developed for the same market, was all that we
would need to protect our interests. This way the developers we work with
can hold onto their source code if they agree not to compete with us in
we are small, we can offer a profit-sharing model where we fund the publishing
and guerilla marketing ourselves and put our sweat equity into launching
the product. This is an incubator model. The
developers we work with, would not have published their products otherwise
because they weren't able to convince a larger publisher to work with them
this way. We assume the initial risk of believing in new technologies and
proving their market value then we will offer these products, ongoing engineering
and their source rights to larger companies for acquisition. We take an
role in our industry's dialogue about how to nurture high technology
We take pride in our
ability to recognize talent and vision and we are willing to put our company
name on the line for a product we believe in.The developer is responsible
for perfecting their product and we help them get recognition. Our next
phase is to help find a larger company to purchase our publishing rights
to continue the development and marketing of the product with the developer.
We see this approach as a real added-value service to the software industry
and the user community becaues it provides an
opportunity for great tools to reach the market quickly while giving unknown
developers a chance to prove they have an innovative product.
At the same time, this model reduces the risk to the larger publisher who
takes it over. The company who acquires the products can write off the
acquisition as a capital expense and everyone wins.
Our structure is a
virtual company and is
by no means perfect. Given our size, it's pretty amazing that so many people
assume that we are a large company. We have been blessed with great support
from the press and clever cash flow management.
Everyone works from
their preferred location and we gather together throughout the year to
exhibit their products at major tradeshows. Our size requires that the
developer is responsible for responding to customers needs and providing
tech support for each of their products.
The software industry
is going through convulsions now. According to a recent newspaper article,
Merisel is in serious debt because a lot of its customers are unable to
pay. Softkey is $500 million in debt due to a high rate of product returns
from stores; and Broderbund warned investors of lackluster sales which
immediately dropped the value of their stock.
We managed to fund
a group of people from the PROFIT of our sales for the past 6 years. That
is pretty amazing given the insanity of this industry. If our model works
and we close some licensing deals, we will have more marketing money for
the new products we publish and so on.
Here is one of customer's comments on our model:
Subj: Re:VALIS Group Model
Date: 96-09-12 09:29:08 EST
As a long-time Mac software developer, I
would like to congratulate you on your success so far. Ever since you explained
your model to me a couple of years ago, I have watching to see what happens.
It seemed too good to be true that you would let developers retain ownership
of their code, but from the developer's viewpoint, I know that its the
ONLY way to keep passionate and inovative product development alive in
the long run.
We hope this explanation
helps you understand our dynamics better and why when you purchase VALIS
products, you are making a significant contribution to helping products
from unknown developers see the light of day.
Our Pledge to You!
We promise to continue to provide this incubator to
unknown inventors in exchange for your support and word-of- mouth advertsing!
So tell your friends and associates about us! Thanks.
Call To Action! If
you think a product of ours should be acquired by a larger company please
contact them and let them know your opinion! If
you are a developer with a mission, seeking to launch your product, contact
Best Regards, RoseAnn Alspektor
The VALIS Group
Tiburon, CA 94920-0831
800-VALIS 04 (800 825-4704)
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