[mirthturtle]

I don't think the math works. $5k + $500/m, for 6 months: that tops out at $160,000 yearly revenue for the 20 projects. Even if it's the same 4 employees spread across all projects, that's $40k yearly salary each as a base. Sounds bad!

It'd take years for any winning bets to pay off and I don't know how you'd pay your employees.

[weare138]

I have a feeling they have some VC backing and they're just farming the work out to cheap overseas companies and freelancers. Sounds like it's some quasi-incubator banking on finding a billion dollar unicorn.

[klohto]

There are other countries than US :)

[twic]

The one way it makes sense is as a mechanism to buy cheap equity stakes. The person running the scheme adds more money to pay market rates for sufficient staff, which effectively buys them a 5% stake in each company.

If it is the same four people across all companies, and their fully loaded cost is 200k (not a lot in the valley, but plenty in many other places), then that works out as 32k for a 5% stake. Compare that to Y Combinator's 125k for 7%.

If you accept that you can't run 20 startups with four people, no matter how much Club-Mate you feed them, then you could try staffing each position at 25%, and be paying 200k for that 5%. Not so hot, but maybe still good enough?

[yellowapple]

Wouldn't be too bad for me (as a dev) if it's with the understanding that I'd be working part-time. Even 20 hours a week would net a pretty decent junior-level pay (and 10 would be even better).

They'd have to be really simple projects, though, if I'm expected to bang out 20 of 'em a year.