How Does EduSource Bill for Custom Software?
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How Does EduSource Bill for Custom Software?

April 4, 2018

Since we don’t use Time & Material contracts or Fixed Bid contracts at EduSource (here’s why), our methods for billing are a bit different from most software shops. Here are the details:

It’s Really Pretty Simple…

This could be your team!

Think of it like this: At EduSource, you pay for the work a team does on a weekly basis. We know how much work our teams can get done. What you pick is how much work you want to pay for them to do. If you want them to complete 17 EduPoints per week, that’s Cruise Mode. If you have need for your software to be completed faster, you can choose Hustle Mode, which completes 33 EduPoints per week.

We charge approximately $1000 per day for our full-time resources. For $6000 per week, you get one full-time resource, plus all the extras that are needed on occasion, such as a project manager, a software architect, testers, and a business analyst. These people work on your project for a few hours each week (more during certain phases), so we lump them all together.

If you go with Hustle Mode, we give you a price break. But the basic principle is the same. Make sense?

The extra thing you get when working with EduSource is an apprentice. We throw them in as a bonus. Our student apprentices work year round and are highly trained. Frankly, with many of them, you won’t be able to tell much difference between them and one of our full-time engineers. On Cruise Mode or Hustle Mode, you always get one to three apprentices also working on your projects. They are the reason we can get through as many EduPoints per week as we can.

How We Invoice

To start a project, we require the first week’s pay as a down payment. Don’t worry – this amount comes right off your first invoice. Even though you pay a weekly rate, we bill every other week in arrears. (For example, if our team works for you for the week of April 9-13 and the week of April 16-20, we’ll send an invoice on April 13 for the previous two weeks.) You’ll get an invoice by email. We ask that you pay that invoice within 15 days.

Clients generally pay us by check, but if you would like to pay by credit card, a convenience fee will be tacked on.

If you don’t pay within 15 days, we add a 1.5% interest charge and reissue the invoice. If we don’t hear from you about getting caught up, we may be forced to put your project on credit hold. This means we’ll be stopping all work on your project until payment is current. If this happens, we may need to reassign your team. Once we’ve settled things financially, it may take some time for us to be able to get geared back up on your project (and you may have a different team).

How We Use EduPoints to Figure Cost

You might think it’s super simple. “I just take the estimated number of EduPoints for my project and divide by my EduPoint rate, right?

We’d prefer you to not think about it in quite those terms. There are some things you need to consider:

  • Your EduPoint estimate is only accurate if you don’t change anything at all. The beauty of the EduSource Pricing Structure is that it’s so flexible. If you decide, after seeing some of the first bits of your new software, that you want to change things around, you can do that. It will, however, affect your EduPoint count. A new EduPoint here or there won’t affect things much, but you might come up with big new ideas that will change things. On the other hand, if you get into it and decide to leave off one whole section of the project, your EduPoint number might decrease drastically. The estimate is just that, an estimate. We like you to allow yourself some flexibility.
  • User stories take more than one week to complete. We guarantee that user stories will be complete by the end of three weeks. Usually, they’ll be completed much faster, but internal and external testing take some extra time, as does internal code review. In addition, it takes us extra time to set up your production environment, etc. In general, budget two extra weeks to get things finished that are already in flight. That will be worst-case scenario.

These are the reasons we’ll tack two weeks onto any estimate we give you. We expect that you’ll make changes and we know that there will be some tie-up work at the end of the project. But please remember, this is still just an estimate. How much we add or subtract depends on you.

Got ideas? How could custom software change your day-to-day?

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