Global Senior Technology Executive, Venture Board Advisor and Technology Consultant, 34 years experience at Microsoft as a Senior Engineering Leader
As many have stated this really depends. Typically if the software is handling a standard business process, there is more value in having a commercial solution that is supported and managed by a large software company and standardizes your business process. If the software is directly related to the strategic value of the company and is unique, custom can be valuable especially if patents are involved. However it really depends, often in acquisitions we were buying customers and/or engineers and new we would eventually toss custom code. It’s important to understand what part of your company has value - customers, talents, IP (patents), etc.
I spent 34 years in the software industry including working a lot with off shore development companies (ie. INDIA). There are a number of companies that actually offer engineering services for equity, they typically want to see and get a business plan. This can be a great way to get off the ground as the cost is lower in these markets and the equity you give us is smaller. As in anything, ensuring you protect your IP and investment in a solid contract is imperative.
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