I considered for a long time whether or not to blog about this situation. I had decided to keep it quiet but I know there is a steadily growing mISV community out there and I couldn't help but let them in on some of the dark side…
One of the many reasons this blog has been relatively empty for the past six weeks relates to a number of reasons, one of them being a former customer. This former customer – who I have opted not to name at this point – has yet to pay me for work performed in the middle of last year.
Long story short: there is a contract, two phases of work, two acceptances of work from him, and numerous admissions that he should pay. To add to all of this, payment was supposed to be kept in an escrow account towards the purchase of a home. The home was purchased in mid-October… and no escrow account existed. To go a bit further, in order to speed things along, I used his wife as our Realtor and he offered to pay the amount from her commission.
Well, after she performed a miserable job as our Realtor, no check came. After attempting to work with him for two months without progress and even being threatened, I started to follow all the options available. I spoke with a pair of attorneys separately and they reached the same conclusion: CaseySoftware will win, now it's just a question of how much.
I finally gave him one last chance and attempted mediation on February 1st. As a result, he offered 1/6th of the amount due and attempted to place a complete gag order on the entire situation… including the terrible job our Realtor performed. After speaking at length with my attorney, it became clear that the Realtor situation could not be considered as they are legally separate entities and relationships. Let me put it this way, Dan Melson did more for us than our Realtor did… and we just exchanged a couple emails.
Therefore, two weeks ago, I sent his account and all related information to a collections company. I prefered not to and even attempted to work with him long beyond what is required by the contract even after being threatened by one of his partners. He has stuck to his guns of requiring a full release and protection of our Realtor (his wife) and refuses to budge. This makes sense because – according to certain 3rd parties – it looks like her behavior is egregious enough that she could lose her license.
It looks like I have two options:
a) collect the amount of the two invoices; release him, his companies, our Realtor from all damages and action; and agree to a gag order which would prevent me from speaking about this situation in any way, shape, or form… even to the extent of not legally being able to share our home-buying experience; OR
b) pursue each of the situations individually which will likely result in either him paying, getting a lean on his assets , or him attempting to hide assets and/or re-incorporate; and our Realtor could end up losing her license.
While I would prefer to not pursue route b), route a) is simply impossible as I've already talked about various aspects of this situation in previous posts.
When you're working for another company, it's quite a bit different as you will most likely get paid. Sure, the company can go out of business, pull an Enron, or collapse unexpectedly, but there is a bit of predictability there. When you run your own mISV and have a number of people working for/with you, it's quite a bit different. You have to pay your people even if the customer doesn't pay you…