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Small Business: Software firm's fee a piece of the pie

Vision 7 Software helps firms get established, and takes a share of the business as its fee.

Michael Hill (from left), Steve Miner and Jason Green, all part owners of Vision 7, demonstrate how the winForce program can help attorneys and investigators with their cases.
XAVIER GALLEGOS/Tucson Citizen

IRWIN M. GOLDBERG
Citizen Business Editor
Aug. 20, 2001
Vision 7 Software believes the future of software design is not taking money upfront but rather taking a stake in the company it's developing the software for.
Vision 7 Chief Executive Officer Steve Miner says the firm's approach to developing software positions it as a venture technology company, not a work-for-hire firm.
Like other venture firms, it provides something upfront, but in this case it is programming know-how instead of cash.
Already the firm has reached agreements with winForce Technologies and Online Self Storage Inc. and its website, www.onlineself
storage.com.
winForce, formerly Blue Knight Technology in Scottsdale, hired Vision 7 to perform much of the software development for the company's winForce program (then known as El Cid!) used by attorneys to create an electronic index of all reports, notes, photographs, tapes and evidence gathered during the preparation of a case.
It was first used in the May 2001 conviction of Thomas Blanton Jr. for the 1963 bombing of the Sixteenth Street Baptist Church in Birmingham, Ala.
John Stevens, then president of Blue Knight, had developed a prototype of the system while working as an assistant United States attorney in the Phoenix office.
"As a person who uses this, without winForce, I probably spent half my time getting ready to work and putting away paper. Now it's all productive time," Stevens said.
The problem was, the software wasn't ready for commercial release.
Jimmy Wood, a co-founder of Blue Knight and now president and CEO of winForce, said it was then the company began seeking a software design firm to make the product ready for release to the market.
"We looked at other developers and felt that this was a style we would like to be involved with," Wood said. "It was a significant amount of savings."
Vision 7 also aligned itself with Online Self Storage Inc., an Oro Valley company that provides the ability to offer online tours, reservations and payment options for temporary self-storage facilities nationwide.
Vision 7 started as seven guys who had been developing software for years.
"We wanted more fundamental relationships with the people we were working with. Many times when you develop software, it reaches the market and you find you really need to do five other things and you have to go back," said Steve Miner, CEO and a company founder.
The group had been working for Ikon Office Solutions until its Tucson office was closed in 1998.
"We all said we could go get jobs over again, or we could do our own thing," Miner said.
And so far, Vision 7's clients are happy with its work.
"Vision 7 played a big part in the initial idea," said Rick Magee, president of Online Self Storage. "Vision 7 has done a majority of the development work and they own a small, minority part of the company."
This ownership is what makes the relationship successful for both parties.
"Their work is not just for hire, but they have an interest in the company's future," Magee said. "Because they are small owners, the real benefit to us is the cost savings. They have a small equity stake and that has reduced the outflow of cash necessary to get the development done."
"It motivates us and them to. They know when they call us, they'll get results," Miner said of the arrangement.
Miner said the company has five partners and 10 contract people who work on the various projects.
"In terms of a business model, I think there's a precedent out there where they can be successful," said William Neumann, director of projects for management information systems at the University of Arizona's Mark and Susan Hoffman E-commerce lab, said.
Neumann said Internet software provider Oracle did something similar with startups who couldn't afford their applications, where they got an equity position in the firms.
He said the risk is that as a small company develops new products, the old ones may fade away. But, he said since Vision 7 has intellectual property and a stake in the company, they might be able to leverage that.

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