LaunchByte

Launchbyte's business model is a predatory one that takes advantage of founders who do not have experience or enough cash to pay the full costs of development for a site. Thinking these guys are actually a legitimate VC, new founders feel excited when they get a call back, but the reality is they call everyone back. They are fully aware there are many new founders out there who have a tough time raising capital and are desperate for it, so they present the illusion of fulfilling that dream. However, they will valuate your business arbitrarily, at some absurdly low valuation. In their attempt to lowball you, they quote figures so far off the mark that it makes them look like they do not know how to run proper valuations. Ironically, they are not sophisticated enough to realize this, but they prey on inexperienced founders so they usually can get away with it. Any seasoned investor will tell you these guys are selling you snake oil. Beware the equity for services model, particularly because no cash actually goes to the startup. They will arbitrarily price their services to you, and then say that part of it is their equity investment in your business and the other part you must pay cash. Thus, this audacious model actually allows Launchbyte to justify YOU giving THEM money, while letting them make an imaginary investment in your business but taking your very real equity in exchange. It is a ridiculously bad deal no seasoned entrepreneur would ever humor. However, if you are new at this and do not know how legitimate VCs conduct themselves, and are just excited somebody valuated your business and made an 'investment', you go along with it. Thinking you will actually get whatever they promise you in their contract, you pay the cash portion, not realizing that while they price your services at $120K+ and make you pay $40K+ in cash, they outsource your work to India and pay at most $10K or so. So they pocket the difference between the cash you pay them and the amount they pay their vendor. Maybe you will get a product, maybe not, but it will not be on time and the quality will likely be extremely substandard if it is done at all. However, it will take you a while to realize this because you are probably inexperienced, so you have no frame of reference on what you should be getting for your money from a dev shop. If you complain, they will shrug it off, and if you complain too much, they will simply try to drop your project abruptly. Founders should avoid these guys. If you actually want to consider them, then try this: pause negotiations with them, go on clutch.io and shortlist the top ranked dev shops in the nation, and get quotes and proposals from them. Compare the quality and detail of proposals you get from them from the preschool quality ones that Launchbyte will send you, which provide no itemization of any of the costs because they are arbitrarily plucked from thin air. The difference will speak volumes. Never, ever, ever, ever pay equity for services. Anybody that suggests it is either an idiot or thinks you are an idiot. Beware.

We negotiated terms of a deal. They were very interested but their terms were unreasonable and justification was opaque. It felt difficult to trust them. For example, they asked how much we had budgeted and we indicated "$100K-$240K" and so their estimate of our costs was $240K. Just like that. We didn't like their pawn shop approach to negotiations so we disengaged while evaluating other offers. For a period of 2-3 weeks, received texts, calls, and emails every 2-3 days. Explained to them their terms were insulting. They responded then let's renegotiate the whole thing. We did, and then they sent us a proposal that did not accurately reflect what we agreed on and would have resulted in us giving up more equity with a lower post-money valuation when there was not even any cash actually changing hands. Reapproached them a month later to propose a pure cash deal and the owner rebuffed us in a way that left us feeling we were dealing more with a playground bully than a professional investment office. Advised them to be more professional because such behavior would earn them a negative reputation in the startup community, at which point the CEO massively overescalated by threatening to sue us and "wreck us digitally" if we tried "any funny sh**". It was pretty ridiculous and immature. Bitterness is one thing, threats quite another. Extremely unprofessional and inexperienced, avoid at all costs. Also worth noting, virtually all the 5-star reviews on this site are either the owner or employees of the company, or people who share the office with Launchbyte and collect rent from them. Sorry to beat a dead horse here, but this company is clearly inflating its rating.