Either You Succeed or Explain

Getting Ready to Launch

It's been a quite couple of weeks in my blog and it's been longer since the last time I wrote about my upcoming product. Before I get down to business let me just wish you a happy new year (that's according to the Jewish calendar).

In the last couple of weeks, I've been mostly busy with preparations for my beta launch. My product is now packaged and ready to ship. There are known issues, but no show-stoppers. I even have some basic license management capabilities, so I'm ready to rock. 

On the marketing front, I'm working on setting up a web site. Part of the reason for not exposing my product name is that I don't own the domain yet. I named my product when I started the development, although the specific domain was taken. At the past couple of weeks I made an effort to either acquire the domain or come up with a new name. 

After many hours of searching I decided that my original name will remain, even if I don't get the exact domain. Many great software companies and products don't have the domain which is exactly their name and that's just fine (BaseCamp at basecamphq.com, Omni at omnigroup.com to name a few). My attempts to buy my domain are not over and that's a topic which is post-worthy.

In the mean while, I'm working on setting up a web site. In order to minimize expenses, I'm doing the site myself. I decided to go for a Content Management System (CMS) rather than develop my site from scratch. I checked several popular CMS systems and found that Drupal feels more comfortable than other popular systems like Joomla and Plone. 

I decided to start working on Drupal using Linux, so I installed Ubuntu 8 on my MacBook Pro using VMWare Fusion. It took me about 10 minutes and just a few clicks to install. I was mostly busy doing some other work at that time. You've gotta love virtualization. 

Once my site will be ready I'll need to host it. My main concern is keeping up with traffic spikes. That's an advantage when using a platform like TypePad. My usual traffic is low, but when an article gets submitted to Reddit the traffic can really soar. TypePad can handle the load, but a single installation of Drupal may cave in. If you have any recommendations based on your experience, drop me a line. 

Silent June

This is my first post for June and June is almost over. I had a lot to say, so it's not that I was out of ideas for posts. The main reason is that I'm working hard on pushing a beta version of my product out the door. I'm ironing out the final bugs and soon I'll be ready to start a private beta. I'm doing my best to start testing it publicly as fast as I can. 

I have a lot on my mind these days. For me, coding was the easy part. The road ahead is going to be the real challenge. It is suffice to say that this phase will only be complete once I'll get the first payment for my launched product. Seems like a long way to go. I'll share some of these challenges in my blog.

On a different note, we're now officially in the summer. Spring brought rejuvenation to my workspace: I upgraded to Leopard, switched to Firefox 3 and started developing using Eclipse 3.4, which is still in RC status. I have a lot to say on all of these products and I'll be blogging about it soon. However, if you're reading this using Firefox 2 than just stop right there and download Firefox 3 now. I'll just say it feels like I bought an extra gigabyte of RAM. 

P.S. If you're in Israel and interested in seeing my product in action, drop me a line and we can meet for a one-on-one demonstration. I'll be happy to get some first hand feedback. 

There's more than one way to start

I'm an Israeli and I live in Tel Aviv. Israel has a very vibrant hi-tech community and startups are a huge industry here with many success stories. Nevertheless, Israel is a very small country. Considering that most of the hi-tech is located around the center of the country, the relevant area is much smaller than, say, the San Francisco Bay Area (for comparison, the Bay Area is about 7000 sq miles and Israel is about 8000 sq miles, more than half is a desert).

When it comes to the community of entrepreneurs and investors in Israel, it actually is a very "small world". Personally, I know several people who were part of successful startups that did commendable exists. People feel that, if they had some conversations with people who made it and heard a lecture from Yossi Vardi (to whom I have the utmost respect) they know what needs to be done. It seems that we've formed some acceptable formula which one should follow in order to succeed. When people meet me and I tell them about my startup they immediately ask how much money did I raise and if I have a patent. There seem to be a consensus around the road to success.

That's why I enjoyed the presentation given by David Heinemeier Hansson (DHH) from 37Signals in the Y-Combinator 2008 Startup School.  I recommend this presentation to anyone in this business. I took some notes, which I included hereunder. It fits perfectly with the way I chose, the way of the MicroISV. Maybe I won't make hundreds of millions of dollars, but I will be working for myself and I'll enjoy what I'm doing while making more than enough money in the process, or at least having a better shot at making money.

I find the presentation very inspiring and entertaining. Highly recommended. I hope that me taking notes won't discourage you from watching it anyway. You'll probably get more insights there.

My notes:

• KISS business model - charge money for your service.
• This is still hard, but the odds are better than trying to build the next facebook/YouTube. We hear about these exits around us and think - "this can happen to me", much like the fear of a plane crash which is rare...
• Million dollars is still a lot of money. It's not that hard to make it and the odds are much better than making a billion dollars.
• For that, you don't need to solve the problems of the world, you can just "open a nice Italian restaurant". Provide a service which does one thing a little better.
• It's hard to sell services to consumers (example from Backpack). Consumers don't easily open their wallet when it comes to internet services (especially with all the freebies around).
• The  "Fortune 5,000,000":
  
  • Essentially, the market segment of small businesses, even 1-5 people. This is the large space between the consumer and the "tiny enterprises".
  • This is an untapped market - many problems waiting to be solved.
  • It's much easier to sell here - people evaluate the product, like it and buy it. No huge investment in red tape, sales reps, etc.
  • Your obligation to the customers paying small amounts is far less binding than to huge customers paying millions (it they call, you'd better answer and do what they say).
  • You can read more about it in this 37Signals post.
• The purpose is to enjoy your life...
  
  • There's a great advantage to not making your company huge (by taking VC money): you can call your own shots.
  • You can create a company which you'll enjoy working at and that's key.
  • Don't plan on working hard for two years and selling out for big bucks and leave the good life. It's not clear how good your life will be.
  • Plan to create a workplace you'd like to work in for the next 20 years.
    
• You can be a small successful business and enjoy your work, like a small Italian restaurants. Don't use Facebook as your role model.
• Crashes the term "viral marketing". Just providing a great service can create a "viral" effect, even if you charge money for it. It's just a new hype over something which has been around for ages. It also contradicts the notion that your have to launch fast to create a "viral effect".
• Having less time is a huge benefit to most people. If you had just 5 hours a day for working you'll focus your time a lot better. You cannot be productive for 14 hours a day.
• Most companies are not built over night. Don't be in a hurry.
• It's never gone get less work. The practices your choose to adopt now will stick with you.
• If you're charging money from your customers, scaling means more users. So scaling problems are a good thing.

Why should people pay when they can get it for free?

One of the most common question people ask me is: "why do you think people will pay for your software when they can get it for free?". Just to put things in context, I'm working on an Eclipse based tool. Eclipse is free and many of the Eclipse plug-ins are free. People working in the Eclipse ecosystem are used to getting stuff for free. So, for me, this question becomes extremely relevant, even though there isn't a free tool that can do exactly what I offer.

I wrote a few posts in the past about giving software for free and the added costs of using free software, including:

• When will the "free edition" work?
• Should I offer a "free edition"?
• When saving a buck actually costs you more

A great post by Bob Walsh over at 47 Hats blog explains why you can still sell, even when your competition is giving it for free. It's worth reading (and I should add it's a good blog altogether).

Bob discusses ways of making yourself more competitive by reducing the Total Cost of Ownership (TCO) and by making your software and your site more approachable. The emotional side is a strong topic. I would have to add that, plainly, making your software cool is a great factor here. Take the iPod for example. Sure, you can get a cheaper player. But the thing is so freakin' cool. This is a stronger factor when you sell to consumers (B2C), but it will also help getting end-users on your side and eventually convincing the manager he/she is making the right buying decision.

Another example: either you succeed or explain

Another example which popped into my head. Let's say you have a strong reference. Maybe an advisor that supports your product, a customer that said he/she will buy your product once it's available. Maybe you want to state your own achievements in order to show that "you know best". When you tell someone about this reference, do you need to explain? 

If it was that successful and that strong, a name of a person/customer/product would be enough. They're successful, so there's no need to explain.

Something to think about when looking for references. And, it's also something to think about when developing your own career.