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Developers often have side projects, whether fully fleshed out or solely as a GitHub repository they’ve been hacking on a couple of hours every week.
But what if they wanted to give those projects a real chance and invite collaborators to help bring them to life? One avenue they have is Assembly, a startup that helps people come together to build a software product. The idea seems to be working as the startup is announcing today that it has raised $2.9 million in new funding.
Assembly is a bit like a Kickstarter for a software product, except that the backers contribute their skills and time instead of money. It’s fairly similar to New York-based Quirky, which lets its community submit hardware product ideas and help with the design before the company manufactures them.
The process starts when someone submits an idea, which then has 30 days to gather at least 10 contributors in order to be given the green light to proceed on Assembly. The initial team can then set up “bounties” or tasks and skills the project needs, along with how many AppCoins, or ownership of the product, each contributor will get for signing up. These bounties can be for anything from design and engineering to marketing, although the company has mostly seen designers and developers join its community.
“We’re trying to build a community of everything that’s involved in starting a product,” Assembly cofounder and chief executive Matthew Deiters told VentureBeat in an interview.
During the building process, Assembly covers all the costs, which so far have mostly consisted of web hosting costs, purchasing domain names, and other similar resources. With that said, while the idea is for the contributors to own the project, Assembly holds the domain name “in escrow,” as Deiters said, until it’s completed.
Once the project starts to collect customers (remember, they’re software products), Assembly takes 10 percent of the revenue. It also handles the doling out of payments to contributors and paying the projects’ bills.
“In general, I’d say that most of the products have aspirations of being a revenue-generating business,” Deiters said. And as software and web applications, paid subscriptions and advertising have been the main revenue models of Assembly’s projects so far.
But along with starting brand new projects, Assembly also allows community members to port over projects they’ve already started and turn them over to the community. In fact, the Assembly team’s previous business, a Y Combinator-backed network for developers named Coderwall, is now a project that lives on Assembly. Deiters said that while Coderwall was doing well and had revenue and even some profitability, the team decided to turn their attention to their idea for Assembly, which they launched about a year ago.
One question the team wanted to help answer by building Assembly is: “What does it take to go from open source to a real product,” as Deiters explained.
Although it’s still working out a lot of kinks surrounding the financial distributions, porting projects, and what taking a project out of Assembly would entail, it’s already launched five products that together have garnered 4 million users and two of them are already profitable. It currently has more than 50 projects currently in development.
Union Square Ventures led the round, with Thrive Capital, Box Group, several angel investors, and previous investor Collaborative Fund also participating in the round. The startup will use its new funding to grow its team and to continue improving it product.
Assembly was founded by Dave Newman, Matthew Deiters, and Chris Lloyd, and is based in San Francisco. The team participated in Y Combinator’s Winter 2012 batch as Coderwall.
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