VenturePact: Outsourcing custom software development

Randy Rayess is co-founder of VenturePact, which is similar to a traditional venture-capital model, but instead of funding they offer custom software development.
Randy Rayess is co-founder of VenturePact, which is similar to a traditional venture-capital model, but instead of funding they offer custom software development. (DAVID MAIALETTI / STAFF PHOTOGRAPHER)
Posted: August 05, 2014

R ANDY RAYESS and Pratham Mittal, both 23, are Penn grads and co-founders of VenturePact, a Center City firm that provides clients with outsourced software development. The firm started in fall 2012 building software services, and evolved into a marketplace last year. I spoke with Rayess, who lives in Old City.

Q: How did you come up with the idea for VenturePact?

A: We worked at startups and realized they couldn't build software and were always looking for developers.

Q: Startup funding?

A: We initially consulted with companies and built software for them and were able to bootstrap this business with those revenues. We sometimes referred companies to remote development firms we knew, and that's how VenturePact evolved.

Q: What's the biz do?

A: We're a marketplace where a company that's building software can search for development teams by location, budget and industry preference. We also vet teams to ensure work quality.

Q: The biz model?

A: We are free for clients who contact us to find software developers to build what they need. The suppliers pay us a fee for referring business and giving them a stamp of approval to ensure they have the necessary technical and communications skills to work with our clients. The fee varies by scope of project and quality of work. Generally, it's 5 to 10 percent of project cost.

Q: Your clients?

A: Our customers are startups to midsize companies building custom software or expanding their developer teams. We currently have about 40 clients, half of them startups. In Philadelphia, we've worked with Firefly, which was recently sold; Seratis, a health-care-communications startup with a mobile app; and Aircare, a startup with a patient-monitoring and management tool to reduce hospital readmissions.

Q: Your competitors, and what differentiates you?

A: We compete with big services firms like Infosys and Cognizent. There are lots of freelance [software] developers. We differentiate ourselves by matching developers who are suited to a client's specific needs. For example, Stripe API is a payments platform. If a client wants to build that platform and be able to use it in London, we match the client with a developer who does that.

Q: Biggest challenge growing the business?

A: The main thing is [building] a great sales team to manage customer experience. When companies come to us, there's a lot of education we do about choosing and working with the right remote developers.

Q: How big a biz is this?

A: We have 12 employees. We'd like to think that in the next 12 months our revenue can exceed $1 million.


On Twitter: @MHinkelman

Online: ph.ly/YourBusiness

comments powered by Disqus
|
|
|
|
|