Cash, revenue share or equity: how to pay for your first release

Option 1: cash

You pay for the work and you own it. Simple, clean, and the fewest strings attached.

• Good when: you are funded, or a budget line exists, and you want full ownership.
• Watch for: the builder is paid whether the product succeeds or not, so the written scope and milestone acceptance are your protection.

Option 2: revenue share

You pay less upfront and the builder recovers the rest from the product's revenue. A good revenue share is capped: it stops once an agreed amount has been recovered. Your cap table is untouched.

• Good when: you have some cash and customers close to paying, but not enough to fund the whole build.
• Watch for: uncapped or open-ended shares, unclear definitions of "revenue", and no option to settle early.

Option 3: equity

The builder takes a share of the company instead of, or alongside, cash.

• Good when: the builder will genuinely be part of the company for years, as a cofounder would.
• Watch for: equity is the most expensive way to pay if the company succeeds. A stake given away early is a stake you cannot offer an investor or a key hire later. See sweat equity for non-technical founders.

Comparing them

Why we never do zero cash

Deals where the founder pays nothing at all tend to fail, on both sides. A build nobody pays for gets nobody's best work. A paced monthly fee keeps both sides honest: you make weekly decisions because you are paying for the time, and we stay aligned because we are fully paid only when the product earns.

How our three tracks combine them

• Paid Build: cash only, on fixed milestones. You own everything on payment. A first commercial release typically runs £40k to £100k.
• Founder's Path: a short paid discovery, a paid proof slice, then a reduced monthly fee credited to the Build Value. The balance is recovered through a capped revenue share. An optional minority stake vests against delivery, with the maximum fixed at signing. You keep control.
• Studio Bet: by selection, for founders whose pilot customers have already paid deposits. Revenue share plus a technical-cofounder minority stake. No board control, no veto.

The sample term sheet walks through a Founder's Path deal month by month, with example numbers.

Red flags in any deal

• No written scope, or a scope that changes without a priced change order.
• Equity with no vesting, or no maximum.
• A revenue share with no cap or no early-settlement option.
• No clear answer on who owns the code, and when it transfers.
• Anything that gives the builder control of your company: board seats, vetoes, or voting rights you did not intend.