YOU GUYS — there's a founder who left one of the world's biggest IT companies to build something that genuinely fixes how software gets built, and I need you all to pay attention because this could change everything we know about corporate tech spending! Nikhil Gupta was actually the chief at Infosys before he stepped away and founded Infonit, which is a company whose entire mission statement challenges the very foundation of IT services. The problem he identified — and honestly, I've been saying this for years so it hits especially hard to hear a former industry titan agree — is that charging by the hour per technician has created perverse incentives throughout every large tech contract in existence. When you bill by the hour, your company gets paid MORE when work takes LONGER, which means there's no reason to be efficient or fast, and it forces clients into never-ending contracts where they pay millions for system maintenance that produces zero actual improvement over time.
His startup, Infonit, replaces hourly billing with outcome-based contracts, and this is one of those business model shifts I can get behind because it's just honest about what the software industry actually needs to do! Instead of selling labor hours they sell measured results, meaning their pricing is tied directly to whether a project meets its stated business objectives rather than how many people clocked in. He wants large companies to stop paying for headcount and start buying outcomes, which would force every IT provider to be leaner and faster from day one since there's no longer any incentive to bloat the team or drag out timelines — it's pure common sense that should have been standard decades ago! He's specifically targeting enterprises that are stuck in legacy software cycles where they keep renewing contracts for system maintenance without ever actually modernizing, which is a massive and underserved market given how many Fortune 500 companies still run on prehistoric tech. The core philosophy of treating software as a product rather than an endless service with renewal fees is exactly the kind of thinking that makes these new startups so interesting to watch unfold — I'll be following Infonit closely, because if they prove this works it could reshape how nearly every large enterprise buys its IT services for years.
Source: https://techcrunch.com/206/6/24/former-infosys-chief-has-a-new-startup-that-wants-to-challenge-the-it-services-world/
His startup, Infonit, replaces hourly billing with outcome-based contracts, and this is one of those business model shifts I can get behind because it's just honest about what the software industry actually needs to do! Instead of selling labor hours they sell measured results, meaning their pricing is tied directly to whether a project meets its stated business objectives rather than how many people clocked in. He wants large companies to stop paying for headcount and start buying outcomes, which would force every IT provider to be leaner and faster from day one since there's no longer any incentive to bloat the team or drag out timelines — it's pure common sense that should have been standard decades ago! He's specifically targeting enterprises that are stuck in legacy software cycles where they keep renewing contracts for system maintenance without ever actually modernizing, which is a massive and underserved market given how many Fortune 500 companies still run on prehistoric tech. The core philosophy of treating software as a product rather than an endless service with renewal fees is exactly the kind of thinking that makes these new startups so interesting to watch unfold — I'll be following Infonit closely, because if they prove this works it could reshape how nearly every large enterprise buys its IT services for years.
Source: https://techcrunch.com/206/6/24/former-infosys-chief-has-a-new-startup-that-wants-to-challenge-the-it-services-world/