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If you have a program which you would like to turn into a commercial product, and if your interest in commercializing the program is strong enough to motivate you to do the dog work required to achieve that commercialization, then we recommend that you contact us. We are not interested in hearing from those with only a causual interest. What we want is partners who will help us build THHG into a solid co-op of software developers for the purpose of sharing overhead and fixed costs and allowing us all to participate in larger ads than any of us would be able to afford alone. The Short Version: ================== The Hobbit House Group (THHG) is a co-operative venture among software developers. We get substantial volumn discounts on software duplication services, disks, labels, sleeves, printing and duplication services, mailing costs, and advertising. As a group, we have greater advertising power than any of us would have alone, and a greater chance to obtain name-brand recognition I, as co-ordinator of the group, along with other members, will help you bring your product to a marketable state. The group offers three plans whereby we will market and distribute your product. These range from TYPE 1, where THHG pays all of the advertising and production costs for the commercialization of your product to TYPE 3, in which you pay all of those costs. In any case, THHG performs production, and distribution of the product. In return for these services, the group gets a percentage of the profit from your product. If you have no profit, we get nothing. If you're interested, all the details are enclosed. Read on. Paul Hinds ======================================================================== The long version: ----------------- Please note that this is a somewhat hurried first cut description of THHG (which is just starting up). I've concentrated on getting in all of the relevant information, but without as much concern as I would normally have to make the presentation smooth and unrepetitive. What is The Hobbit House Group ("THHG")? ---------------------------------------- The Hobbit House Group is a co-operative venture among software developers whose products are written in Borland or Miscosoft C/C++ and/or 80x86 assembly language (MASM or TASM). You can see our first ad in the April, 1993 issue of the C Users Journal, page 115. Why C/C++ and 80x86 ASM under Borland/Microsoft? Simple reason; I prefer these for my own development and I feel comfortable supporting products written in them. This is necessary because the co-operative venture which I am putting together as THHG will have to support the products which we sell, even if the original developer gets run over by a trolly car. In the long run, we might grow to the point where we can support products written in other languages, but for now we're sticking with C/C++ and 80x86 assembly language and only those from Borland and Microsoft. The concept is simple. Many of us have an idea for a product, and perhaps even the developed software that can be turned into a commercial product. What many do not have is the time and/or money and/or inclination to do the dog work which is required to commercialize a product. That's where THHG comes in. There are two major sets of "dog work" required to commercialize a product: 1) The stabilization and documentation of the software such that it is supportable in the long run and doesn't cause product returns in the short run. It is useless to sell a product for any amount of money if a significant portion of the user population is going to return it in disgust after discovering the first three major errors it contains. Alpha and Beta testing are absolute necessities. Documentation must be far more than casual. And on it goes. 2) All of the issues other than the software development. Some of the required jobs are: o find a place to do the disk duplication with good reliability and reasonable price. o design, and contract out for the production of, a physically attractive and professional looking product and perhaps demo disk as well --- a custom label, perhaps a custom disk sleeve, a professional-looking mailer, etc. o decide where to advertise, write the ad copy, come up with the bucks to do the ad, contact the magazine, negotiate ad rates, etc. o write new product announcements and distribute them to various magazines o find the time to do the dog-work of stuffing mailers, answering ad inquiries, etc. o research licenses for compaction programs and choose the one to use with your product. Contact and negotiate with the vendor. o decide on pricing strategies for multiple/LAN installations It goes on from there. THHG is a co-operative venture by software developers to take advantage of volumn discounts on all direct costs, including disks, software duplication services, customized lables and sleeves, mailers, postage costs, advertising, etc. A major advantage of THHG will be that together, we can afford larger-sized and more frequent ads that are more likely to attract attention. Many readers barely glance at the little ads in the back of the magazines, which is all most of us could afford if we go it alone. With the total advertising power of the group, we have more chance to build the name recognition that is difficult for an individual to acquire. Another advantage of THHG is that we will be able to market small products which would not otherwise be financially viable. If you have a minor utility that you think might realistically sell for $10, what can you do with it? Unless you really think you'll sell an awful lot of them, you don't dare spend the money to commercialize and advertise it, since that would cost too much and you'd almost certainly end up being out-of-pocket on the deal. With THHG, you can just add it to the product list. It won't be advertised, but the list goes out to everyone who contacts the group for any product. If it sells, great, if it doesn't all we are out is the relatively small cost of procucing a few copies. I am a firm believer in TANSTAAFL. For those of you who aren't Science Fiction fans, TANSTAAFL is a layman's version of the Second Law of Thermodynamics, to wit: TANSTAAFL => There Ain't No Such Thing As A Free Lunch. - - - - - - - - - That is true of THHG as well as everything else in life. I'm not attempting to put this venture together for my health or as a hobby. I expect it to take me a great deal of time and energy and I fully expect to be paid for my efforts. It is not my intent to ask you for money. This is not the software equivalent of "vanity press" book publishing. I won't ask you for any money up front, nor will I pay you any money up front. What I will ask for is a share of your profits, once there ARE any profits. If there are no profits, I get nothing. This will greatly annoy some people. If the thought of anyone else making money off of your efforts annoys you, I ask you to consider that many people (writers, actors, etc.) employ others to market their products/efforts, and that payment is traditionally based on results (I.E. a percentage of the gross). If it still annoys you, then THHG is not for you. You should also consider that THHG may be the only realistic way you CAN market your product since you may not be willing to put in the time, energy, and money that it takes to do it on your own. It's hard enough just making software commercially viable; the other half of the job, advertising, producing, distributing, etc., is more than most of us want to take on. This venture is structured so that we can both get what we want. I am making an assumption here, of course, and it is that what we both want is to see our products go out into the world and to make money doing it. There are three different product categories which determine how your product is dealt with. All of the membership duties/requirements/advantages, are the same, regardless of what category your product falls under. The designation of product category will be one which we mutually agree on. If you have more than one product, they can be in different categories. Under no circumstances do you pay any money to me out of your pocket. Depending on the plan we agree on for your product, however, you may have out-of-pocket expenses for the commercialization of your product. THHG does not see a penny until your product begins to turn a profit. The three product categories are: TYPE 1 --- THHG Pays It All --------------------------- You pay no direct costs (THHG pays for production, advertising, etc.). You have zero out-of-pocket expenses, now and forever. THHG puts out all of the up-front risk on this type of membership and consequently takes a proportionately large share of any resulting profits, starting at a 50-50 split, pretty quickly dropping off to a 33-67 split (you get the 67), and eventually trailing off to a 15-85 split. Products which, for whatever reason, do not strike me as having adequate commercial potential will not be accepted for this category. Initially, we are concentrating on small and medium scale products which can be effectively advertised in The C User's Journal. If your product is such that it would require, for example, a full page ad in PC Magazine, we are interested but do not yet have the capital to deal with the required ad budget. Such a product could not be a TYPE 1 product, but could be TYPE 2 or TYPE 3. TYPE 2 --- Middle of the Road ----------------------------- You pay all ad costs for ads which are specific to your product. THHG pays up-front production costs and all costs for joint THHG ads, of which your product is only a part. We will have to agree on the ad budget, and I have to be convinced that your product is acceptable for this level of membership. Depending on the product, your initial ad costs could be as low as $500. After that, if profits warrant it, you might want to spend more on advertising. THHG will continue to pay all production costs. The profit split on this category starts off at 40-60, (you get 60), drops rapidly to 25-75 and trails off to 15-85 on large profits. TYPE 3 --- You Pay It All ------------------------- You pay ALL production costs and all costs of ads which are specific to your product. Your payment can be direct to the distributer of the services provided or via THHG, but in no case do you pay anything other than the exact cost of the services rendered for your product. You get the advantage of volumn discounts on all direct costs and ads, and you get to participate in the larger ads as well. THHG will handle the production, the placing of ads, new product announcements, mailing the product to customers, etc. Since you are putting up both the software and the up-front cost, THHG takes only a minor part of the profits of the product, in return for its efforts. THHG's share amounts to less than 20% of the first $5,000 in profit and drops to 15% above $10,000 in profit. I will have to agree that your product is commercially viable and adequately tested and documented, and I will also have to agree to your ad budget. You will be required to spend a minimum of about $750 on ads, but depending on the product and where the ads are placed, it could be considerably more. Keep in mind, as you think about whether or not you want to work with me to commercialize your product, that it is my absolute intent that THHG be as fair as possible to the customer, and not attempt to gouge for as much money as possible. THHG is going to have, and be widely recognized as having, excellent products at excellent prices and with excellent documentation and support, and with reasonable upgrade prices. ======================================================================== upgrades: --------- Upgrades are one of the mixed blessings of life. You get a new and presubably better product but you also get to pay more money for something you've already paid for. It is our intent that upgrades for products from THHG carry VERY modest upgrade prices. We insist that when you plan your upgrade strategy, you think of the user first and yourself second. Our belief is that this stategy will help build customer loyalty and thus in the long run will be more profitable than a strategy which gouges customers in the short run but which alienates them in the long run. Please re-read the previous paragraph. If it doesn't make sense to you, or if you don't agree with it, THHG may not be for you. ======================================================================== You will be required to meet the THHG standards for source code documentation. NOTE: This is not a simple requirement! THHG source code requirements are probably as strict as anything you have every imagined in your worst nightmare, and this is not a negotiable requirement. I saw a humourous discourse on "real programmers..." recently on some BBS or other, along the lines of "real men don't eat quiche", and the one that struck me as most relevant was "real programmers don't do documentation". Well, to the extent that that's true, THHG programmers are not real programmers. THHG programmers are required to go out of their way to provide EXTENSIVE documentation for both source code and product use. The good news here is that I will provide considerable help to you in documenting your code and your product. If you feel that you have the time and energy and money to go it alone, I encourage you to do so. I suggest, however, that you VERY CAREFULLY, evaluate the amount of time/energy/money that it will take you to commercialize your product. It is likely to be considerably more than you might think at first. On the side of going it alone, the effort required to stablize and document the product will almost certainly be less for you alone than what I will require if you choose to join THHG. THHG is intended to be a prestigious group with high standards. Take a look at the HHSTRING product enclosed in your sample kit, and you'll see what I mean. This is a minor product at best but the documentation is FAR more extensive than most programmers would bother with and far more than most users would expect. THHG members will be expected to do excellent documentation as well as to have an excellent product. That's the bad news. The good news is that the other half of the effort, the physical production/distribution, will entirely absorbed by THHG, which is part of what we do for our share of your profit. Also, THHG will help you with documentation of both your code and your product. ======================================================================== THHG will not under any circumstances advertise prices such as $49.95 or $99.95. I'm sure that someone on Madison Avenue has long since proved conclusively that such prices are attractive to the general brain-dead population, but I have always considered them insulting and I will not have any part in their propagation. THHG will absorb tax and shipping costs, against a predetermined product sale price. That is, if you want to sell your product for $50 and we anticipate tax/production/shipping costs of $5, then we will price the product at $55. The customer will be presented with a single cost. There will be no tax. There will be no "shipping and handling". There will be none of the common bullshit which goes under various disguises but amounts to "just for the greed of it we're going to charge you a few more bucks". THHG products carry round number price tags such as $38, $50, $90, etc. The customer pays one simple price and it's up to you and me to see that he/she gets a quality product. I simply will not have it any other way. ======================================================================== Membership Requirements: ======================== 1) Meet the Group standards for excellence of both product and documentation 2) support your product As the developer of your product, you are ultimately responsible for the support of your product, and you are required to respond to user queries and problem reports. Enquires to THHG will be dealt with directly if possible, and if we can't handle it, we'll find out when you can call the customer to attempt resolution of the problem. We understand that the Group developers are likely to have "day jobs", so we will do our best to mediate between you and the customer so that neither of you is unduly torqued. We will, when necessary, explain to customers as gently as possible that instantaneous response is not always available. We require you, on the other hand, to recognize that a "customer" is, by definition, someone who has paid money for your product. It is our point of view that by doing so, they have, whether you like it or not, obtained a lien on the life of both yourself and your firstborn child. This is exaggeration for effect, but if you do not agree with the thrust of the argument, we cannot market your product. A customer who has paid money for a product deserves adequate support and if you are not willing to provide it then there cannot be any workable arrangement between yourself and THHG. 3) act as a beta tester for products developed by other members of the group. Obviously, other members will beta test your products. This will not be an absolute rule, as some products may be specialized and require beta testers with special knowledge which some of us may not have. 4) make suggestions about improvements in the other products developed by the group members 5) You will be responsible for responding to inquiries by potential members. People who are thinking about joining THHG may want to talk to current members. As a member it is your duty to take the time to talk to people who are referred to you by THHG. Every attempt will be made to spread this out over all members so that no one member has to deal with more such conversations than any other member. As part of such discussions, it is your duty as a member of THHG to explore the desirability of allowing the prospective member to join THHG. If we take on a product that ends up being a "dog", the group overhead suffers and we all lose. ======================================================================== Questions about your product: ----------------------------- Please answer EVERY question, even if it's just to put it "none", "no answer", "not relevant" or whatever. I want to be sure you didn't FORGET to answer one of them. Please copy this portion of this file into whatever word processor or text editor you plan to use for answering it. Handwritten answers will not be accepted. If you can't type well enough to answer this questionnaire easily and quickly, you have no hope of doing the documentation which will be required with your code and your product should you become a member of THHG. Your return submission to us may be on a disk or a printout: ------------------------------------------------------------ Describe your product Describe the job/background of the typical user of your product How far along are you towards each of the following steps code documentation of code documentation of product (user manual) alpha/beta testing Will the source code be included as part of your product? Will it be an option and if so, how much do you want to charge for it? What is a reasonable price for the purchase of both the product and the source code at the same time? Describe your mix of on-line help and printed document support. Is a printed manual necessary? Could it be an option, with a copy of it being supplied on disk (in ASCII form) to allow a lower price for those who either hate manuals or love lower prices? If the hardcopy manual is to be an option, how much do you think we should charge for it? What do you see as the main competition to your product? In what ways is your product superior to the competition? In what ways is it inferior? I will not, in general, mention inferiority in ads, but I MUST know the state of your product relative to the competition in order to deal with user response and in order to structure an accurate but appealing ad. What do you think your product should sell for? (BE REALISTIC! Tell me what people WILL pay, not what would you LIKE them to pay!). What do competing products sell for? THHG will not deal with developers who have no idea what the competition is like for their product, in terms of both quality/features and price. Where do you think is the best place to advertise your product? Is your product particularly amenable to LAN installations and if so how do you think the pricing should be structured for networked installations? Are site licences and/or volumn discounts appropriate for your product? If so, how do you think the pricing should be structured? Do you have any absolute requirements regarding the marketing of your product? For example you may feel that your product MUST be advertised in a particular journal. How should we deal with people who just ask for information on the product? A demo disk? Printed literature? How many disks, and of what size, will be required to distribute all of the files for your product, 1) in demo form, 2) in commercial form ? Keep in mind here that THHG will provide a compaction program which is at least comparable to the commercial packages (PKZIP, etc). Although not quite as good as the commercial packages, it has the advantage that it does NOT cost us the $2+ per disk that PKZIP and others want (it is free to THHG members). ======================================================================== Miscellaneous notes: -------------------- For group advertisements in which specific products are mentioned in detail, advertising costs are pro-rated according to the cost of the product. That is, if your product sells for $50, your account will be debited half as much of the ad cost as a product that sells for $100. The cost of general ads, which are essentially ads for THHG as a group, are shared equally by all members but prorated by product sale price. Specific ads for one product are born by that product. We all gain by having the ads done through the group because all responses to all ads receive information concerning ALL of the products sold though the group, not just the specific product requested. Depending on your product agreement with THHG, you may or may not actually pay any of the ad costs. Your account will ALWAYS be debited by the appropriate amount, but if your product has no sales, you don't have to pay anything unless that is part of the up front agreement. It is a requirement that there be a demo version of your product, suitable for uploading to bulletin boards. There can be some very reasonable limits to the useability of the demo. In other words, the demo should be the full product, but with a limit on, for example, how many files it will deal with, or how many data records, or the number of graphics file types, or some similar feature. The intent is that the demo give the user the exact sense of what the program does and how it does it (the "look and feel") and whet his/her appitite to buy the real thing. Our first distributed product is a C/C++ language function library dealing with character and string manipulation. The "demo" consists of everything that the full version does, except that only the tiny memory model is provided, and no source code is provided. The demo, in other words, is NOT the real thing. We are NOT doing shareware here. We admire the shareware concept but our VERY strong perception is that for every sale made through shareware, there are another 20 or 30 copies of the program being used for free. We are capitalists, and that doesn't appeal to us. One approach that we like, however, is to develop a product which is modular in a way that allows you to essentially give away, via a working demo version, a portion of the whole in order to convince the user that your product is useful. Then have a "professional" version which is available only via purchase but which has more/better features so that users are likely to upgrade to it from the shareware version (which most of them won't pay for otherwise). As a member of THHG, you are required to upload both your own product demo as well as those of other members, to the bulletin boards you normally deal with. We also encourage all members to upload all of the Hobbit House Group software to as many boards as possible. If you don't deal with any bulletin boards, you should certainly contact the main ones in your geographical area if and when you have a product to sell (this is true whether or not you join the Hobbit House Group). We also encourage you to upload outside your geographical area. THHG will co-ordinate BBS uploading by geographical area. We also will request that you upload a THHG-provided file to BBSs. This file will explain the operation of THHG and solicit new members as well as advertising existing products. The more members there are, the lower all of our operational costs go, and the bigger ads we can afford together. We will NOT, however, allow new members just for the sake of having more members/products. Only quality products with excellent documentation and user support will be admitted to THHG. benefits of joining: o save on advertising and be a part of bigger ads that are likely to draw more attention than the smaller single-product ads we can each afford individually o save on production costs. Disks, software duplication, labels, mailers, and even postage costs, are reduced by bulk purchases --- a top-quality (physical) product becomes possible at a reasonable price o other members will act as beta testers for your products and refinements on your existing products o other members will upload demos of your product to bulletin boards in their geographic area o THHG will provide guidance and direct effort in assisting you to bring your product into compliance with our standards. We will work with you to comment your source code so as to be in compliance with THHG standards. o THHG will help you write new product announcements, and will distribute them to the appropriate magazines o If you have only the Borland or only the Microsoft compiler, but source code is part of your product, THHG will work with you to make your code compatible with the other compiler. This is essential, since with only one of them you lose half of your potential market. The experts I've talked to all estimate that BC and MSC each have roughly 40% of the market, with the other 20% spread among Watcom, Zortech, and a few others. the bad news: o you are required to test software produced by other members o you are required to upload other member's demos to BBSs o some of the profits on your product go to THHG (details elsewhere) your product (particularly the source code, whether or not it is sold as part of, or as an option with, your package) will be required to meet THHG documentation standards and your product will be required to meet THHG standards for both user-friendliness and documentation. This can be a giant-killer. The enclosed HHSTRING library source code, test file, and on-line function finder are provided primarily to show you the quality expected of a THHG product (except of course in the case where you are receiving the hhstring product or demo because that's what you ordered, in which case this information file regarding THHG is provided to acquaint you with THHG). This requirement alone may very well be enough to convince you that you do NOT want to become a THHG member. Check it out. If you simply have a C-language product that you want to sell, but you are not willing/able to meet our standards, we cannot work together. THHG is only interested in quality products and in members who are willing to fully document and support their products. ======================================================================== you will provide all source code for your product to THHG. THHG will then compile the program, test it, and produce a "Golden Master" for use in software reproduction. The master copy will, of course, include any ancillary files which you want included in addition to the .EXE file. Whether or not the source code is included in the package is a whole 'nother story. The "readme.1st" file, or its equivalent, will originate with THHG, but will be written in co-ordination with you. When submitting a product for membership in THHG, you will be required to sign a contract which states the following: o you agree to a price structure which is based on a number of issues, including whether or not you market the product, and/or upgrades of the product, and/or variations on the product, in any way other than through THHG. We aren't dumb enough to try to keep you from doing what you want to do (and which you are, of course, going to do in any case), but we want for both of us to understand up front what the deal is. o although you retain ownership of your software, should you decline, at any time, to provide full user support for the product, or in the event of your demise or incapacitation, THHG automatically assumes full rights to the program and becomes the sole arbiter of the distribution of proceeds from any sale of the product by THHG. We're not out to screw anybody here; the intent is to protect THHG's image by not allowing products to become unsupported or otherwise "dead". If you die or become incapacitated, we will extend every effort to continue to support your product and to send to the person you designate a fair share of any profits from same. o THHG agrees to make arrangements such that in the event of the death or incapacitation of Paul Hinds, all information relevant to the operation of THHG will be distributed to all members so that they may jointly decide how to proceed. This should be unnecessary (but will be provided anyway) since it is our intent to keep all members fully informed as to all relevant circumstances and conditions of THHG operations. We're going to spell out all the details of who we do business with and how much everything costs. The main thing this part of the agreement is intended to cover is the customer list. More about that elsewhere. ======================================================================== customer lists: --------------- From the point of view of the co-ordinator of THHG, I am vehemently opposed to distributing the customer list. I don't want the customers to be contacted directly by members, for two reasons. First, if we bother them too much, they will start to ignore the group as a whole. Second, if you deal with the customers directly, you are defeating the whole purpose of the group. You're either in THHG or you're not. If you're in, you don't need the customer list. From the point of view of a developer of my own software, however, I find it unacceptable that I not have a list of the people who have my product. I expect that many of you will feel the same way. On the other hand, as long as I am satisfied with THHG's operation, I am willing to let them handle my mailings. As a compromise, I will NOT distribute the customer list, but I will make it part of the package that will go to all members in the event of my incapacitation. Furthermore, if you decide to leave the group, then, assuming your departure is on amicable terms (which means we aren't suing each other), you will get a list of all those who have purchased any of your products. All members of THHG will be made known to each other, so that you can be sure that if I do anything any one of you doesn't like you can at least be sure of your ability to inform others in THHG. Remember, this is a cooperative venture, not a situation where THHG simply provides a service to you as a client. I don't want clients, I want partners. Then, together, we can go out and get customers! ======================================================================== Part of your share of the profits will be held "in escrow" pending any product returns and/or any need for THHG to support the product beyond your own ability/desire to support it. You can walk away from the product any time you choose to, but THHG can't. The good name of THHG rests on every single product which we promote and we cannot simply "drop" a product just because you die or move to Oakland. To do so would give THHG a bad reputation and would hurt the sales of all other products. It cannot, and will not, be allowed. ======================================================================== Current Member's evaluation of a proposed product: -------------------------------------------------- [this may be extended in the future. It appears just to show you the kind of thing you may be asked about other products]. What products are you aware of that would be competition for this product? What do you think of the quality of the documentation for this product? Is it "user-friendly" enough for today's market? What do you see as the best place to advertise this product? What do you see as a reasonable sale price for the product?