Industry Analysis and Trends   back to top

skyBuilders.com, Inc. is well positioned to take advantage of the extremely rapid growth of the Internet as it is used for business and communication. Web-based information management is a powerful organizational idea whose full potential is unlikely to be realized worldwide for decades.

Internet usage has grown dramatically in the past ten years with a significant portion of that growth occurring in the past three years. The use of groupware - programs which allow multiple users to access and manage shared information - has seen a particular surge in growth, and database backed groupware for such management is in high demand (i.e. Microsoft Access and IBM/Lotus Notes). Today's business model cannot succeed without a competitive software solution for data management. This trend will continue to gain momentum as information collection and exchange scales to accommodate new users and businesses. Using database-backed applications over the Internet (instead of an intranet) is the natural combination of the power of groupware and the accessibility and pervasiveness of the Web. We see the future of commerce, business management and communications revolving around web-based groupware. This usage extends beyond the boundaries of business to include groups of any kind: trade associations, clubs, communities. The number of individuals using groupware at work or as part of an association is incredibly large and will only continue to grow.

Web-based groupware is a relatively new entry to the software industry, its role created by the phenomenal expansion of computer and Internet use. This niche within the software industry is in a state of open competition. Tools now in the desktop domain are being explored for their potential as web-based applications or "web services." Many large "portal" web sites now offer web-based scheduling, personal or group; your information is stored on their server and you access your schedule through their portal. Web-based email is another common offering. Your email is available to you anywhere there is an Internet connection. Again, your data is stored on the provider's server and accessed through their portal. The main competitive advantage to these services is that the end user's information is accessible to them from anywhere in the world, via an Internet connection. There are disadvantages to these services. The data is on a server over which the customer has no control, the range of services is rather limited, and to use the group functions, the customer must convince his or her friends to join. While these services are quite useful and successful, they barely scratch the surface of what is possible using Internet-based groupware. Webware will be expanded upon to include Internet accessible business operational information. Data will be acted upon, added to, and searched via the Web. The new desktop will be the Web browser.

Until recently, the US was in the longest state of economic expansion in its history. This type of environment has fostered the startup and growth of many new companies, in turn increasing the demand for Internet access and business software (although the dot-com boom has become a dot-com bust, especially for many venture-funded companies with limited ability to generate real revenues). Our proposed market segment includes businesses of small to moderate size as well as other, not for profit organizations, all of which are likely to increase in number in the future. More and more organizations are looking for comprehensive data management solutions. Unfortunately, there is a down side of this economy - namely the premium placed on talented employees. Software developers have been in extremely high demand, and salaries have become higher than ever. We are creating jobs where there may not be enough talented people to fill them. Our compensation packages must be extremely competitive to attract talent to a new company. We hope to do it with "virtual employees," who work with us entirely over the web.

In an economic downturn, business software is a product which turns out to be indispensable. Companies wishing to be competitive must continually upgrade and improve their information infrastructure. This translates into a degree of sales stability when the economy shrinks.

The software industry is exceptional in that one is able to copyright a program as well as patent specific features. skyBuilders.com, Inc. has adopted an open development and use policy and will not be applying for any patents on features. This is a similar approach to the business as is used by such companies as Cygnus Solutions and various Linux distribution and support companies such as Red Hat and VA Software. We license our products under the skyBuilders OpenSource License, which is compatible with other open source licenses. We may elect to go with the GNU Public License (GPL). See the Open Source Initiative We aim to restrict the time and money we spend legally defending our intellectual property. Our business is not about selling code, it's about selling service.

This method of producing software is referred to as "open-source." We believe that product development will be improved by allowing clients, developers, and others to work together on problems and improvements to our original code while we organize the incorporation of these updates to the core product. This is only possible when we allow the source code to be viewable and freely exchangeable.

There is an industry split between open-source proponents and those who wish software to be proprietary. There is the risk that our programs will be deemed an infringement upon the rights of a non-open-source competitor. We make all reasonable efforts to ensure that the copyrights and patents of competitors are respected and that our developers and consultants act ethically in this regard.

Software is a product high in development costs but low in storage, distribution, and production costs. During our startup phase, we intend to conserve cash by limiting our packaging and distribution costs. Many companies ignore cost effective options, such as delivery via the Internet, in favor of flashy packaging. This is a valid strategy for companies with branded names, where "shelf exposure" is valuable marketing. For an emerging business, it is practical to save money on packaging and distribution and plow it back into development. For skyBuilders.com, Inc., the costs for developing our current line of products are sunk. Our inventory costs are, of course, negligible and our products are distributed via the web. We have chosen to retain cash in order to further fuel our development. The cost of distribution is also small - only the cost of maintaining an Internet connection. We also install and maintain (upgrade) our software via the web, so there is no need to have salaried persons to be available on-site. Our cash flow will be steady as there are, aside from startup costs, very regular and predictable cash flows out and few costs associated with inventory. Projected sales will generate enough revenue within two years to break even.

The outlook for the industry, and this niche, is one of increasing growth. Web-based applications and "Web Services" are a new technology which have been explored for only a small fraction of potential uses. Groupware is in increasing demand. As use of the Internet grows, so will the need for information management tools which are Internet ready. We see this as an area of exceptional developmental possibilities.

A current lack of modular, web-based tools for small businesses and organizations puts the company in an excellent position to develop name recognition and gain market share early. We are in our initial beta testing phase and have a significant lead time advantage over our competitors. Our flexibility regarding module selection will allow us greater range in pricing over other companies, and our range of products already developed is far beyond any suite currently offered. Our applications run "on top" of most any browser and web server, and on all major relational database systems; we are in the unique position of working with (on top of) well-known hardware and software, so that we are not in direct competition with any major company. We are also multi-lingual in a direct bid for domestic multi-lingual and international sales.

We intend to position ourselves as a less expensive yet more expansive enterprise information solution. Initial adopters of our technology will be such organizations as non-profits and community groups who want the best value for their dollar. The membership of these groups will serve as the best recommendation for the product, allowing us vertical expansion among groups of a similar nature or theme, and lateral expansion as users bring our product to other organizations they belong to.

Which applications are suited for "Web Services," and which aren't? Word processing, page layout, and graphics-intensive applications are out. E-commerce, Events and Resource scheduling, Project management, Knowledge (or Content) Publishing, Document and File sharing, Financial management, Presentations, Multimedia streaming, Web-based Training, and Groupware of all kinds are in. See our list of Competitors for the range of web applications now available.

The market for software is extremely large; annual sales reached approximately $10 billion in 1999 in the US alone. Within this vast industry are many smaller, specialized categories. Initially, we will be focusing on business and organizational solutions for small to medium sized companies and groups, a domestic market which purchased approximately 6 billion in software last year. The international market is double that of the US market, and will only expand as developing nations become futher industrialized.

Our target market is made up of companies and organizations of fewer than 100 persons and likely to be relatively unsophisticated as a web presence. We will aim for any and all industries, non-profit groups, religious organizations, and educational institutions. Once we gain a foothold in a particular specialized group, we will aim for vertical expansion within the segment. The types of groups which are early adopters will determine how we further target the market.

Our geographic segment will initially include only the greater Boston area, host to thousands of organizations which fit our profile. Our sales strategy is very flexible. As we expand into Internet advertising, we will be able to maintain a national, and, due to the multi-lingual characteristics of our products, an international presence. The international market is currently secondary to our plan, but we project that it will account for up to 50% of sales after our third year of operations.

The increase in Internet usage is not limited to large companies - quite the opposite! Smaller companies and organizations are finding that they must enter the Internet arena as soon as possible in order to become and remain competitive. There is and will continue to be a high demand for business solutions that use the Internet and integrate e-commerce into corporate data flow. While our technology is relatively new to the market, we see no sociological barriers to its acceptance and proliferation. Our target segment is already using the technology in a limited way.

There is an abundance of business applications available. The vast majority are off the shelf options which are Internet ready in a very limited way. They are not web-based but have many of the capabilities of a web-based product (though none of the advantages). Most of these products are made by companies with significant name recognition factors and are in widespread use, such as Microsoft Exchange Server, IBM/Lotus Notes, and others. These companies enjoy healthy reputations which are consistently reflected in their sales. Should these companies "port" their software to the Internet, we would face incredibly stiff competition.

While it may be difficult for a small startup to influence the movement of business from the intranet to the internet, companies such as those mentioned above make it their business to change the face of our computer screens almost yearly. We face the significant challenge of attempting to seriously move organizational computing to the Web. We do not have advertising budgets of comparable size. We do not have the same developmental resources. We are at a serious disadvantage should these companies see what we are doing and decide to concentrate their efforts in the same direction.

We do have significant advantages over our competition. They include:

• A range of features and capabilities not offered by competitors
• Modular architecture - more flexible for size and price scaling
• Open-source code - greater client control
• Specific and under-served target markets
• Large numbers of initial adopters in the technology markets
• Significant lead-time advantage.

Our company also has operational advantages - we keep our overhead and fulfillment costs low. The products do not cost anything to produce or store. They are delivered via the Internet at a fraction of the cost of physical delivery. We do not maintain a full time sales staff but rather rely on word-of-mouth advertising and our business partners to promote the products. Additionally, the software runs "on top" of a variety of popular platforms and browsers and open-source Internet and Web Protocols, like TCP/IP and HTTP, and back-end protocols like ODBC and SQL, which free the company from entering into costly licensing agreements. We also offer a unique, modular approach to selecting a package. Clients buy only the features they want, allowing us a greater range of price flexibility. This results in higher client satisfaction now and upgrades and expansion more easily done in the future.

Additionally, the company is in the unusual position of working with (on top of) well-known hardware and software, so that we are not in direct competition with any major industry players.

Businesses and organizations just emerging into the Internet marketplace are where we concentrate our marketing efforts and where we see the greatest opportunity for penetration into our desired segment. Our products fill a niche market which is being underserved by large, brand name corporations. While we need to establish a corporate brand and "identity," there are many small organizations who will be attracted by our price and flexibility. Once we establish ourselves in a local niche market, we will be able to expand both vertically and laterally, both locally and nationally.

Some of our major competitors are email-based groupware, calendar/scheduling services, web publishing/content management systems, web file sharing services, e-commerce providers, as well as huge enterprise information systems which are being made web accessible.

Features of some skyBuilders webWare modules are available "free" on the web at advertising-supported web sites.

skyBuilders mission is to provide the tools to run these services without the ads that make them "free," and without exposing an organization's data on a remote server out of their control. Unfortunately, this means they must pay us for the webWare and incur the cost of running a web server. But with the rapid decline of web hardware costs and our aggressive pricing plans, it is surprising how little it will cost to have these services run at ahosting provider or inside an organization's IT facility.

Products and companies with which we are in direct or indirect competition.

skyBuilders.com, Inc. has many strengths relative to our competitors:

• Highly talented and motivated management team.
• Our target is a niche market which is being underserved.
• Open-source development environment fosters rapid evolution of products.
• Many more web-based applications available than our competitors.
• Business parterships add value and one-stop shopping.

There is a niche market which is being underserved by large, name brand companies. For a business which can help a small, technically unsophisticated client launch themselves into the Internet marketplace, the opportunities are immense. We intend to position ourselves as an approachable, one stop business computing and internet solution. We will focus on new organizations with little or no web presence and market our products as the solution to getting on the Internet quickly with an integration of legacy information and programs that our large competitors do not offer.

Our biggest advantage is our open-source development model. We encourage developers and users to work on problems and new features as a community - more than one person may be looking at or changing the same piece of code at the same time. This leads to more innovation and a larger pool of developments and solutions for the company to choose from. We incorporate the best changes in new releases. Only the best survive this culling process, making the end product as strong as it can be. We feel that this method will consitiently keep us at the forefront of the industry.

There are significant competitive risks. The respect that name brand companies, such as Microsoft, command is powerful. Many consumers trust the name - that's what having a brand is all about! Should such a competitor port a popular application to the Web, consumers would certainly be attracted to the name on the box.

There is also a perception of our methods, and of the platform, as risky. We are proponents of open-source, but will this methodology keep the business sustainable? Will a user be left with a product but no product support, no way to expand or upgrade? We will need to prove our technology and permanance in the business world. The security of the internet is another large issue. While our sites are guarded by passwords, there has been much publicity lately regarding portals which have been beseiged by unscrupulous Web users. How will we assure our clients that they are safe? Will we be able to protect ourselves from liability should a site be compromised? These risks bear much consideration. We feel that producing a well designed product paired with outstanding support and service will address these issues. We intend to consult experts in these fields to help us along.

For a large, well-established software business, the barriers to entry are non-existent. With healthy development and advertising resources, such a company could enter the market within a year of beginning their efforts. This makes the timely release of our product imperative. By being first to market we will gain valuable recognition and market share.

For small companies, the time to market is significantly longer due to the costs and resources involved in producing a saleable product, as well as the human talent needed to engineer this technology.

The barriers to entry are, overall, very easy to overcome, especially as the Internet standards and protocols become easier to use and program with. Immediate entry into the marketplace is essential to ensure the competitiveness of the company.

Strategy   back to top

skyBuilders.com aims to become a premier developer and service provider for web-based groupware for the global market. To achieve this goal, we have developed a strategic position which emphasizes:

• Open-source development practices
• Ownership of the company by its employees and contractors
• Continuous market research and client feedback
• Accommodation and facilitation of client needs
• Sell the service and the product

Of primary importance to us is that our customers communicate their issues regarding the products to us. The only way to continually improve both the product and our sales is to know what our customers want and give it to them. Though we sell the product to an organization, we realize that the consumer is really the average group member or employee of an organization. This is essential to understanding what will sell.

We feel that the software market, and computer use in general, is moving towards a total use of and dependence on the Internet. It is no longer a bonus to do business on the web, it is a necessity. We want our products to be the most stable and advanced design available in order to facilitate this move. We feel that open-source development is what will get us there. The open-source development method is similar to the process of expanding scientific progress through open communication of results and information. We plan for the development of our webware to be evolutionary, with many developers working on the same problems and sharing their information in an online community setting. This is a major difference between skyBuilders.com, Inc., and most other software companies, one we feel is a major advanage.

The problem with open-source software is that there is no way for us to stop our products from being freely distributed. In fact, we don't discourage the practice as we release under a special public license. How then, do we propose to be profitable? The answer is service. We sell the convenience of a product that comes with setup, support, and a unique online help system which is continuously updated by our users. No product is salable if is isn't convenient and easy to buy, set up, and use. Without our direct support, the product is not so easy to initialize. And our market is organizations, a group is less likely to pirate software than individual users.

Our final major strategy point is ownership. Ownership of the company by its employees is especially important to us. We feel that there is no motivation for good work as holding an equity stake in the result of that work. We want our "skyBuilders" to be a part of the company in every way. The people who work to make a company profitable should benefit the most. We also encourage employee ownership to self-capitalize the company. We do not intend to rely on being able to obtain venture capital financing.

skyBuilders excels at helping small organizations succeed on the Internet by providing them with quality tools and support in an accessible and open manner. We are able to understand what functionalities a client is looking for and sell them only what they need rather than a program overburdened with "features". We work to integrate existing programs and databases so that data is never lost and transitioning to our groupware is easy. We listen to client concerns and requests and use these to direct our development efforts. Our "skyBuilders" developers can also easily incorporate custom features, adding yet another level of service and flexibility.

Our open-source policies are not unique, but they are relatively rare and are therefore a strategy which should be examined closely. The companies who are open-source proponents are not our direct competitors, but the public perception of the methodology may prove harmful to us. Because the code is open, anyone may copy or distribute the programs. People or companies may also charge money to distribute or support our product. This is part and parcel of the idea of open source. In order to maintain a position as the most reliable company to support the product, we may have to compete directly with a "piggyback" business, much in the way that Red Hat competes with VA Software or PC makers compete with IBM.

Our open-source philosophy and employee ownership policy is geared toward making the company attractive to do business with, especially for organizations wanting to work with a socially conscious company. There are a number of software companies that work in this manner. Some examples are Cygnus Systems, Red Hat, and VA Software. They have been successful with similar strategies - we hope to achieve their success by adopting some of their values and strategies. We also want to stand out from our competitors, many of whom find the idea of open-source development antithetical to the idea of turning a profit. The competitive environment is fierce, we feel our "open" strategy will help us effectively compete.

We will position our webWare as open-source for both Linux (which is itself open) and Windows (which is closed). Open-source is the most reliable and maintainable solution for any organization; they can work with their own in-house developers or choose from thousands of capable independent consultants.

Marketing   back to top

skyBuilders.com, Inc., distinguishes itself from its competitors by combining so much in a single package. Other software companies sell monolithic and usually proprietary closed programs which are not easily tailored to the individual organization's needs. We aim to both anticipate and respond to the specific wants of our customers.

During our startup phase we will rely heavily on press publicity through contacts already known. This will publicize our new technology and draw attention to our web site. We will upload our open-source code to developer web sites like SourceForge.net, FreshMeat.com, ASP today, etc. We expect open-source Windows code will cause a marketing buzz, since most code for the Windows platform is currently closed. We also anticipate goodwill and word of mouth sales based on positive response from users of our beta testing sites. Focused marketing will be made, within the first six months of operations, through the Internet, using banner advertising on major portals such as Yahoo, Excite, and others. This is an inexpensive way to reach highly specialized audiences, such as small business owners or non-profit organizations. Trade publications for these types of groups will also be targeted for press releases. We also plan to gain name recognition by donating our software and services to high profile charitable or community service oriented groups.

As an incentive, we offer no-risk trials using the slogan, "Fly (theSky) before you buy." We guarantee increased productivity and utility of data and offer to integrate databases currently in use and preserve any information generated during the trial phase. We believe this will prove an effective incentive for attracting first time users.

Our business partnerships will also be looked to as a source of referrals and sales as we make arrangements to have our product sold as part of a web-site hosting package. This will also enable us to offer special packages to supply organizations with Internet access, hardware, and software, such as database applications, which complement our products.

Our initial promotional plan calls for the launch of two sections of our web site. In Spring, 2002, we plan to publicize the launch of our developer site. This site will be our point of contact for recruitment of developers and contract programmers. We will, in conjunction, issue press releases, primarily by email. Special releases will go to the major web sites dedicated to open-source development to attract professional attention to us. Then we will launch the 1.0 version of timeLines™ and the web site for our initial marketing campaign. We will open a version of timeLines™ to the public as a demo site to show how we use it to run our own business.

We will market timeLines as a set of interworking modules, easy to use separately at the beginning, then adding functionality seamlessly as needs arise. The customer buys only the modules they need now, while knowing they can expand further at any time.

Pricing will be tiered for different types of operations. We call these tiers .EDU, .ORG, .NET, and .COM. Educational and non-profit customers will be charged prices which are lower than those charged to business corporations. This will attract the more price-sensitive .edu and .org types of organizations. As an added pricing option, the webware may be advertising driven. The organization may receive the service from us or our hosting partners for "free," with advertising banners shown on their site, generating revenue for us. As a second option, a group could purchase the software from us and have adversiting on the site to generate revenue for themselves. This is an option which will likely appeal to non-profit groups.

Our service contracts are designed to provide the client with continuous support, current upgrades, and up-to-date help files culled from the questions and answers asked by our entire client base. Our help files are not shipped with the product but are served from our main servers. We continually update the files for the module and release version. This allows us to provide a value added service and generate a continuous revenue stream. We are also able to track the help requests and design our new releases around common questions and problems.

Partners

• Hardware partners will deliver integrated turnkey solutions (the skyBox).
• ISPs (ASPs) will pay us 1/3 of monthly rental revenues.
• Development partners will share sales proceeds nearly evenly (for sales they generate).
• Consulting/Customizing partners will take 30% of revenue..
• Sales partners will earn 20% commissions.

All these percentages will be subject to open discussion and critical suggestions by our partners, who will have access to this open-source business plan.

One of the foremost advantages the company has in its startup phase is that the cost of operations is primarily due to computer equipment, telecommunications, and Internet hosting fees. We pay no rent or utilities due to having our corporate headquarters housed, for the time being, in the house and lab space of our founder, Bob Doyle. This will greatly reduce our initial negative cash flow. Since we are not a business which relies on customers walking in off the street, this arrangement is ideal.

The primary work spaces are on the first and third floors, and in a finished basement. The first floor and basement space houses our servers and is a secure area, alarmed against the possibility of intrusion. We currently manage about sixty web sites, of which twenty-plus are beta-testing timeLines. They are seved through two redundant T1 Internet connections. We backup some 30,000 files each hour, make daily copies that are saved for a week, and burn weekly backups to CD-ROM. These are moved off-site regularly. We take all possible precautions to keep our, and our client's, data safe.

Our limiting factor, initially, is the volume of sales and associated start-up activity we can handle. In order to be flexible in this regard, and to save cash, we hire contract employees as needed to provide on-site client services. We maintain relationships with people in diverse geographic areas who are ready to work at a moment's notice, giving us flexibility regarding location and expense. As our volume becomes steadier and more predictable we will hire more full-time staff.

For each sale we make, we oversee the initialization and startup process carefully. Consultants who provide service on-site must have a proven track record of superior customer service. We maintain files on each contractor to track their level of success with each assignment in order to better staff future projects. The clients themselves are encouraged to use our support infrastructure (skyBugs) to report problems, make suggestions, and review our product and personnel. Our order fulfillment process is clearly outlined to provide quick turnaround time. Our clients are able to have a working site within hours of placing an order with us.

Computers are the mainstay and lifeblood of our operation. skyBuilders has webWare running on 10 computers in-house and 3 off-site at hosting services. They host, serve, are our development space, and store all our information. Our in-house computers are backed up, hourly and daily, then weekly to permanent media (CD-ROM) which is stored off site. We have backup servers also housed off-site to ensure continuity of service for our clients. We have insurance policies to cover the loss or damage of the physical machines. These measures ensure that no critical data will be lost due to inopportune circumstances. We also encourage our clients, when choosing hosting services, to use over-the-Internet backup of their data. Our initial Internet service (DSL) was only 99% guaranteed online (down 7 hours per month). We use redundant T1 connections, from Galaxy/TowerStream (wireless) and Primus/Shore, with separate business DSL lines for web browsing.

Our financial records are kept on our own servers. This information is backed up daily, off-site, so no more than a day's worth of activity may ever need to be reconstructed. The accounting system we use is one of our own design, part of our suite of products, designed to industry standards. We reconcile our books to reality monthly, quarterly with the help of a CPA, and yearly undergo an audit of our financial statements.

Our operations are under constant review and improvement to identify and fix problems before they happen and further streamline daily processes.

The company's founder, President, CEO, and Chairman of the Board of Directors is Bob Doyle. Concurrently with developing timeLines™, until 2000 he was the Digital Video Guru at NewMedia Magazine and the Director of Desktop Video Group, NewMedia Labs East. He has a Ph.D. from Harvard in Astrophysics, and holds several patents. He invented a number of computer-based hardware and software products, including the Super 8 Sound Recorder in 1973, Parker Brothers' computer game Merlin in 1978 (5.5 million sold), the iXO telecomputer in 1981, and MacPublisher in 1984, the first desktop publishing program.

Bob's experience includes successfully developing, marketing, and selling products, and managing the start up and expansion of businesses. Bob's experience, not to mention enthusiasm and ability to motivate, make him eminently suitable to manage the direction and growth of skyBuilders.com, Inc. Bob owns 75% of the issued shares of the company.

Bob is joined by his son, Derek Doyle, who acts as the CIO and Vice President for Development. Derek boasts six years of software development expertise, including interactive CD-ROMs for PennWell Publishing and NewMedia Magazine and database-backed interactive web sites both in industry and as a consultant. Prior to joining skyBuilders.com, Inc., Derek worked in the School Division of Houghton-Mifflin Co. as an interactive web site designer and developer, heading numerous projects to establish interactive web sites for public schools across the country. He is a graduate of Brandeis University. Derek owns 25% of the issued shares of the company.

Derek's primary responsibility is Product Development. His duties include managing the end product of our development contractors and integrating their solutions into new products and releases. He reports to Bob.

The roles of CFO, Treasurer, and Secretary are being filled by Rebekah Lea.

Pending active sales of skyBuilders webWare, Rebekah has taken a position in investment banking, and manages skyBuilders financial affairs part time.

The company has retained the firm of Hutchins, Wheeler and Ditmar, LLC as our counsel and Tobias, Fleischmann, and Shapiro, PPC to act as independent accountants and auditors.

The Board of Directors is currently comprised of Bob Doyle, Derek Doyle, and Rebekah Lea. The Board intends to add at least two more Directors to expand the range of experience and skill on the Board. The industry knowledge and experience we intend to add will principally be in the legal and business management areas. Directors are compensated at various levels with company stock options. See the Appendix for details.

The company's development and contracting community (the real "skyBuilders") is comprised of a mix of newcomers and seasoned industry professionals who are selected through a rigorous testing process designed by Bob and Derek. Technical knowledge and track record are scrutinized before contracts are entered into.

The primary forms of compensation are as follows:

• Contracting fees/salaries.
• Royalties for developers whose work is released as part of a product.
• Sales commissions.
• Sales goals incentives

We structure our royalty system after publishing houses. Our programmers are authors. When we "publish" their work, we pay them royalties per sale.  We have set aside a pool of 10% of sales for this purpose, allocated among contributing programmers.  Author credits are determined by a committee of company officers, managers and selected outside contractors.

  Sales commissions (to our Consultants) will be 33% of sales in order to attract attention to our products and develop sales personnel.  Any employee or contractor may also make sales. 

The majority of selling will be done or supervised by a product manager, who will develop and oversee sales within vertical markets.

To manage the increasing number of contractors and developers, the company will hire regional managers to oversee sales, module development, and "page" development. These managers must have superb technical and managerial skills to succeed in this role.

There are two types of managers:

• Product managers - develop vertical markets.
• Module managers - coordinate the development and release of modules.

As most of the skyBuilders contractors will not work at the corporate headquarters, it will be difficult to maintain personal relationships with individuals or communicate expectations and policies. Upper management will make special efforts to telephone and e-mail our staff to build real working relationships and communicate issues. Our developer/contractor web site will be central to timely communication and community building. The company will have policies, news, events, and financial updates posted at least weekly as well as recognition of star developers and consultants to involve individuals in corporate activities. We plan to encourage and subsidize community service and charitable events and make public the issues and concerns which are important to each member. The web site will also serve as a virtual "suggestion box" and as a way to contact, directly or anonymously, the officers regarding problems. We also have established a mediated conflict resolution policy to ensure fair and equitable treatment of each individual in all respects.

At skyBuilders.com, Inc., our motto is "from each according to their ability and to each according to their contribution." Few programmers are compensated in proportion to the value they contribute to a software company, especially the most productive top few percent of programmers who write over 90 percent of the valuable code. We have developed novel compensation options to help attract and retain top talent. Specifically, we set aside 10% of gross sales revenues as a royalty pool to be distributed pro-rated to the authors (the skyWriters) of our skyServerPages.

Our "skyBuilders," with the exception of upper management and a few key staff persons, are all contract "virtual" employees. This means that we can attract developers from around the world. Developers work from their home location by browsing our web site for projects they have expertise in or would like to learn more about. They contact the company and we select a person or persons to contract work. In this way, the company exists primarily on the Internet. We feel this is how many businesses will work someday.

In 1997, Bob and Derek used server pages to build a members database with group emailing for NewMedia Lab and Desktop Video Group, and Derek built a database-backed web site for Penwell Publishing. Later, they conceived a calendar-driven, database-backed program that could schedule an organization's events and manage its resources, tightly integrated with member information.

In the first quarter of 1999 they deployed beta sites for small non-profit community organizations in the Boston area to test these ideas. Later in the year, they integrated a web-pages publishing system that scheduled web pages for serving at specific dates and times. Pages are created, edited, and scheduled from a web browser.

Planning to offer these programs for sale, Bob and Derek imagined a suite of tools that would support their online business, so that they would be building business tools they needed, wanted, and would use themselves. They expanded the data model to include tables for a database-backed accounting system that could be integrated with an e-commerce shopping cart.

skyBuilders.com, Inc. is now our most important beta site. Bob and Derek needed tools with which to organize and manage their own business and they are putting their designs to the test every day. Currently, Bob and Derek are seeking more organizations to act as beta testers. Each group currently beta testing uses different sets of modules, teaching us daily what features are important, how intuitive the interface is, and what we can add or improve upon.

• Initial product R&D: Spring 1997, activity is ongoing
• Beta testing: First quarter 1999, ongoing
• Incorporation: April 2000
• Launch of skyBuilders.com web site: August 1, 2000 (minimal publicity)
• Launch of OSP, OIL, ODBM marketing support sites: January - March, 2001
• Installation of T1 line: June 30, 2001
• Installation of second T1 line: September, 2001
• skyBuilders Trademark Registration: May 2002
• PR campaign launch Spring, 2002. Heads up to major industry players
• Begin marketing: Summer, 2002
• Launch of sales site: Summer, 2002

Primary on our action list is the launch and maintenance of multiple web sites for our beta site customers. We will run a small ISP at skyBuilders to support these web sites, and to gather experience in hosting Web Services. These sites will focus our efforts in four distinct directions: demonstration sites with related technology ( OpenDatabaseModel.com, OpenInternetLexicon.com, etc.), recruitment of developers and consultants, sales and support, and a development community "clearinghouse". We plan to add e-commerce and sales to the main skyBuilders.com site in Summer 2002.

Our development plan revolves around our various beta sites and the development community web sites. We envision these sites as places where developers will find projects they would like to be hired for, discuss bugs, fixes, policy, sales, and more. A sense of community is the most important thing to engender in our skyBuilders. If we cannot achieve this at skyBuilders itself, we will work with existing developer resource sites, like OSDN SourceForge.net.

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Author: bobdoyle

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