The Leader Board

FREE! — Engine Yard Rails Road Show

Fri, 23 Oct 2009 07:05:00 +0000

If you care about the end-to-end performance of your Rails application, you will want to attend this free, half-day seminar—coming to 5 cities this month. At this seminar, you will learn about: Scalable Cloud Architecture, end-user performance monitoring tools, infrastructure scaling, cost-effective load testing, and much, much more!

• Boston, MA — October 26
• Chicago, IL — October 27
• Austin, TX — October 29
• Los Angeles, CA — October 30
• Seattle, WA — November 2

Poor application performance can damage your brand and your company. A slow application drives customers away, decreases search engine ranking and damages your search marketing effectiveness. Come learn about tools, techniques and products from Engine Yard and our partners that can help you build high performance Rails applications without breaking the bank.

To learn more visit http://www.railsroadshow.com

Healthy Web Marketing Seminar

Fri, 09 Oct 2009 04:48:00 +0000

TOMORROW – Friday, October 9th 4-6 pm

In today’s world its important to utilize every outlet that you can to help make your business succeed! There is an ever-increasing amount of technology out there to help promote and bring visibility to your business. Over 75% of the US population in online. 90% use the internet to find products, services or information.

On Friday October 9th from 4pm-6pm Lorrie Thomas will be speaking on healthy web marketing to learn how to utilize the tools for online marketing success! The event will take place at Santa Barbara City College on the west campus in the Fe Bland Forum.

Where: SBCC West Campus, Fe Bland Forum
When: Friday October 9, 2009
Time: 4pm – 6pm
Cost: FREE

To learn more visit: Web Marketing Therapy

Being Positive

Thu, 03 Sep 2009 00:54:00 +0000

At New Leaders we’ve been working towards creating a better workplace by being as positive as possible. In the past we have come off as negative and this post marks the end of that era. Since our new found mind set has been in practice our business is doing better — more leads, sales, on-time schedules and quicker payments.

What changed?

Technically nothing except our mind set. It is like the world is rewarding us because we have the right attitude. Maybe because of this shift our reactions to being more positive is leading to better and bigger opportunities. Maybe we are more deserving than we once were. I am not going to claim to understand why it works. It just does.

It is easy to state that something is wrong. Point out the bad parts and generally bring everyone down around you. Colleagues, customers and partners alike. Negativity is like poison. You can really ruin it for everyone with your constant complaining and general poor outlook of everything. Try being positive about every aspect of your life. Like quitting smoking or dieting it will be hard to kick the habit. People revel in their agony. I assure you once you do become more positive your business and life will improve drastically.

This also goes for fear, envy and self defeating attitudes. Any image you hold in your mind will manifest itself in your actions and reactions from others. You’ll knock down every opportunity with a snide remark. You’ll treat the people around you like they can’t execute and you’ll have a short fuse when things go wrong. You are probably already holding yourself back from success because you think about being unsuccessful regularly or all the reasons you can’t succeed at something.

I am not trying to come off new-age like. Instead I am illustrating the destructive power of negativity. You need exterminate it from your life completely. If you don’t you’ll always have a barrage of unfortunate events and a self-defeating attitude that will hold you back from the things you truly desire.

Start today. You can change if you really want to. I know you can do it. Focus on all the great things you do have. Be thankful and gracious. See how you can helps others to succeed by not always putting yourself first. Attempt to be truly positive toward every opportunity that comes your way.

I assure you. Things will improve. Try it!

Adobe Creative Suite Commercial Featuring MEDIUM (2004)

Wed, 29 Jul 2009 06:10:00 +0000

Free Wins!

Mon, 20 Jul 2009 17:20:00 +0000

This year’s big idea? You’ve got it. It’s FREE!

The author of The Long Tail and editor of WIRED Magazine Chris Anderson penned a new book about the business models surrounding FREE products and services. At New Leaders we believe deeply in providing FREE products and services when possible. FREE lowers the barrier for customers and encourages higher adoption rates. FREE doesn’t mean you have to be a non-profit, instead you find a way for a third-party to pay for the experience or increase your sales through samples. The book provides a myriad of different ways you can increase your sales and exposure by simply giving something away. It also opens up by mentioning Google Docs which has a warm place in our hearts.

Download the free audiobook from iTunes

Read The Book Online on Google Books

Buy a hardcopy on Amazon

Thorsten von Eicken of RightScale featured on New Relic's Rails Lab

Sat, 18 Jul 2009 01:35:00 +0000

RightScale, our customer who is a leading cloud computing company and our partner New Relic which specializes in Ruby on Rails application monitoring recently produced a Master’s Interview. Thorsten von Eicken, CEO of RightScale shares his insights on the advantages of deploying in the cloud.

Watch Interview (42.4 MB, 6:50, QuickTime MOV)

Flexilis Beta Release 9 is Out!

Wed, 15 Jul 2009 12:11:00 +0000

We had the honor to work with Flexilis on their latest Windows Mobile client. Flexilis combines enterprise grade security with end user simplicity, protecting your device and data from a variety of threats facing mobile devices including: loss, theft, viruses, malware, and hackers. Their team is top notch and we’ve have had great success working together. Check out their new site and mobile applications to keep your information safe and secure.

Flexilis Beta Release 9 is now out and ready for download! This update focused on long term improvements based on extensive user feedback and testing which include major user interface/experience improvements on both the client and the web and speed/stability enhancements on the web.

Download The Beta
https://beta.flexilis.com/

They also provide a solid stream of mobile industry updates on Twitter. Subscribe at http://twitter.com/flexilis

Logpost: Works on Nokia E66

Sun, 28 Jun 2009 14:57:00 +0000

@hnprashanth posted a screen shot of Logpost running on a Nokia device.

We knew we wanted to make Logpost universal for mobile phones with web browsers. It looks like we got lucky and now end up running on more platforms than originally anticipated. This example really communicates the power of web-based applications and how we shouldn’t commit to only one platform but continue to be available on all of them let it be a device or an operating system.

Logpost: FEATURED on Apple Web Apps

Sat, 27 Jun 2009 13:10:00 +0000

Every time something we create gets ~~posted~~ FEATURED on Apple’s site I get excited (Second time for us). ~~I know they basically accept all applications but~~ it always makes me really happy. Next we’ll have to sell an app in the App Store.

http://www.apple.com/webapps

Introducing Managed Web Hosting

Fri, 26 Jun 2009 12:15:00 +0000

Since the very beginning of New Leaders we’ve always offered hosting. Many of our customers are familiar with “Aglile Box”, a domain we used to for our early hosting customers (http://yoursite.agilebox.com) when their site was in development. As of today we are now combining the Agile Box services with Design on Demand and Thincloud. Hosting is one aspect of our Infrastructure services we’ll be expanding upon soon. Not only do we offer affordable basic hosting plans we can offer true cluster and cloud deployment by working with our partners Engine Yard and RightScale. Our goal with hosting is to combine it with the rest of our service to deliver a complete end-to-end web development solution for our customers.

You can now order hosting online

Sample Hosting Plans

Basic Website Hosting — $49 Per Month

Basic Website Hosting offers a simple shared hosting with monitoring and backups that is secured and managed. The benefit of choosing New Leaders is our custom deployment and configuration, free inclusion of Google apps and the experience of New Leaders knowing how your solution is built and maintained.

Thincloud Application Hosting — $99-199 Per Month

Thincloud application hosting is custom tailored with Thincloud Base pre-configured and installed. This unique configuration takes into account your you application will be served for your company and allows New Leaders to begin the development of your website of custom business software.

Rails Application Hosting — $99-199 Per Month

Rails Application Hosting is similar to Thincloud without the pre-installed version of Base. This allows developer to start working on or deploy new applications. Rails Hosting has a special configuration created by New Leaders to provide a large number of common libraries for developers and system admins to begin working with.

To view more hosting plans please visit our managed hosting page.

Logpost: Twitter for Mobile Phones

Wed, 24 Jun 2009 04:00:00 +0000

After a request from Twitter, Inc. to change the name of our client we decided to completely reinvent the application altogether. In just a couple of days New Leaders is ready to roll out an entirely new version of our mobile Twitter client. Many of the out of date features and bugs have been fixed and the new mobile web-based client is targeted at any mobile web browser not only the iPhone.

Accessing Logpost on Your Mobile Phone
1. Tap on the web browser your phone
2. Type in http://logpost.com/login
3. Enter your Twitter username and password

(It requires a Twitter account)

To use Logpost (Formally Twitter for iPhone) you’ll need an mobile phone capable of browsing the web and a Twitter account. The timeline screen is elegantly designed so you can easily flip through all of the messages with the flick of a finger. Simply click on your friends’ icon to view their profile. You can read their posts and begin following their feed. When you meet friends using Twitter you can quickly add them right from your mobile phone.

New features include the ability to search Twitter and view daily trends to see what today’s hottest topics are. The entire application has been redeveloped to increase speed and universal access wether your on an Apple, Palm or Android device. You’ll find that by clicking on individual Tweets in your timeline you are now able to carry out a host of new options including favorites, retweeting or following that person. Go deeper by reviewing their profile and seeing who they follow. We’ve taken extra special care with the redesign of the Tweet screen to make the area as large as possible so you can see what you are writing in an oversized font. Logpost is a huge upgrade and is free for anyone to use on any device anywhere.

Works on all major mobile platforms

VIDEO: The 7th Kingdom

Sat, 02 May 2009 01:00:00 +0000

I found another great Kevin Kelly talk about the evolution of technology. Technology may very well be a part of nature. The point he makes is that it should be the goal of each and every person to find their mission while on earth to continue to evolve our species.

Technical Demo of Ruby On Rails

Mon, 30 Mar 2009 00:00:00 +0000

The co-founder of New Leaders, Robert Bouquet will be a guest speaker at the Northern Nevada Software Developers Group in Reno, Nevada March 25th (tonight) at 6pm.

Robert will be introducing the benefits and fundamentals of Ruby-on-Rails web application development. If you are in the area you are welcome to join us.

Download Ruby-on-Rails Introduction Presentation

The event is located at Buckbean Brewing

Buckbean Brewing Co.

1155 S Rock Blvd. Reno, NV 89502
(775) 857-4444

(Get directions)

Watching Twitter cross the chasm

Thu, 26 Mar 2009 01:45:00 +0000

It is hard to believe that something as simple as 140-character posts from millions of people on one website would grow to become something so crucial. Twitter is about to cross the chasm. Like a meteor that flies close enough to see only once in a while, we are about to see Twitter rise to critical mass. It is really worth watching.

We’ve seen it happen with many different things, like the iPod or Google. Products that changed the way we behave. Twitter is beginning to change the way we communicate through crowd sourcing. By being connected and transparent we can get a sense of how humanity is feeling, thinking, and experiencing our world.

More often than not, Twitter is breaking the big story. Much like Youtube became the way to share video, Twitter is quickly becoming our open public wire service. It is no wonder national newspapers are feeling a pinch. The news is now being recorded by eyewitnesses in realtime, and shared with millions. How do you compete with that?

Compared to the biggest sites in the world, Twitter is relatively small. With the addition of new celebrities and constant mentioning by media companies it is only a matter of time before Tweeting is as well-known as Googling.

So what are the lessons that we can learn from the rise of Twitter?

Free wins
Twitter, much like Facebook and Gmail, rose to its popularity because it was free. Free wins because it is like a gift to customers. They complain less and are willing to put up with a lot in order to keep using the service for nothing. Free makes it easier to spread because there is minimal barrier to entry.

Get it right
Early on the popularity of the service even caught Twitter by surprise. They had a series of embarrassing outages that made them look amateur. They promised to overcome these issues, and ultimately they did. If they hadn’t, it wouldn’t be as popular. I believe these issues helped dramatize their story. It also proves that people will stick with free even if the service is interrupted from time to time.

Less is more
Twitter is very easy to build. That doesn’t mean it can’t win. I find myself even trying to solve complex problems to create a new product. Twitter doesn’t. It is so simple and easy that that is why it works. Google was simple, iPod made it easier. Twitter is proof that 140 characters is better than a blog post. Constraint makes us get creative and keeps it very simple for less dedicated users.

Ecosystems
SEO is Google’s ecosystem. The accessories for the iPod are an ecosystem. Facebook applications are an ecosystem. Twitter’s cottage industry of sites, clients, and tools provide an ecosystem. Ecosystems ensure that their product travels far and wide. By providing a very open API that allowed easy access for developers, it made Twitter posting standard in many applications. They even worked with competitors to make sure their Twitter integration was supported. We all can learn a little something about not being a walled garden.

Unintended
When Twitter started, it was an internal product used by the developers of Odeo. Odeo was hammered when Apple incorporated Podcasting into iTunes. Twitter, an internal communication method, would soon become much bigger and more important than Odeo. The creation of Twitter was for fun, to solve a real problem. The popularity was unintended. You need to play around a little to see which products work and which don’t. Always sticking to the plan may lead you in the wrong direction; you may need to deviate in order to innovate. So have some fun and make what you feel passionate about – you may be surprised by the results.

Language
With Google we got page rank, search optimization, and relevancy. With the iPod it was playlists, dock connectors, and Podcasting. Twitter follows true with its own language of Tweeting, Tweeps, and a whole host of words to explain what we are doing and who is doing it. From time to time I even find myself accidentally entering @name into my email client. Twitter is modifying our behavior, which is a true sign of critical mass.

These are just a few examples of how Twitter is about to go from an internal communication method for developers to one of the most powerful communication methods on the planet. I always felt there was something special about the service because it was so simple to use compared to Facebook or Myspace. It is nice to see everyone make this realization as well, and know that simple will never go out of style.

Twouble with Twitters

Just a cartoon I found online that adds some humor and ridiculousness to the Twittersphere.

http://current.com/items/89891774/twouble_with_twitters.htm

Defragment your day

Thu, 19 Mar 2009 18:00:00 +0000

Life seem random? Endless barrage of emails, phone calls, meetings breaking up your day and eating away at your billable hours? Recently we’ve come up with a way to deal with these insurgencies on your time and how to get your day back.

Everyday we are bombarded with a ton of information. It is nonstop, up-to-the-minute, and just about everything is classified an emergency. You need to organize your time into segments that increase the productivity of every activity. Group your billable hours, communications, meetings, and personal time into separate segments. By doing this, it will allow you to completely focus on each activity. Everything else can only be dealt with during its specific segment.

The diagram contains illustrated segments of time.

Administrative or Meetings
Work or Billable Hours
Communication
Personal Time

The example on the left displays an average workday for us before optimization. A meeting or phone call in the morning, billable hours mixed with emails, lunch, another meeting, some more billable hours, etc. Emails were distracting us from completing our projects and even worse, they were keeping us from making money. To combat this, we instituted a new way of segmenting our day.

For the first part of every day we put in 3 straight billable hours based on requests we previously received. These requests might have come in just hours or even weeks before, it really doesn’t matter. However, not a single request from today will be fulfilled during this initial period.

Now, get some food. Don’t worry about today yet; just have a nice happy lunch.

We’ve provided a 1 hour, email-only segment. Read all of your new messages and respond to each one meaningfully. Deliver any files or completed to-do lists to your customers.

The rest of the day is for administration, estimates, invoices, internal projects, personal stuff, phone calls or meetings. If you need to have a meeting or phone call, it can only be scheduled between 2pm and 6pm every day. People often have a number of miscellaneous items they need to take care of during working hours. This could range from paying a parking ticket to depositing a check. These things are also handled during the 2pm-6pm segment.

That’s it. Go home at 6pm. Don’t check your email. Don’t work. Hang out with your family, watch TV, eat, shop, whatever. This is your personal time. Spend it wisely.

At 10PM everyone logs back on and puts in another 2.5-3.0 consecutive billable hours. This period has zero distractions and people tend to be ultra-creative at night. This period is optional, but if you want to stay on top of the game, we recommend the evening period.

At the end of the final segment, check your email to make sure you have an idea of how tomorrow night will work and prioritize for your next morning session.

We’ve found that this process not only helps to increase our day-to-day productivity, but also our revenue generated per period. If you deviate from time to time it is okay, just try to get back on the plan. It isn’t always easy to stick to the regimen, but if you do you’ll make more money, complete your projects, and be less distracted by all of the things that can and will happen.

This work is licensed through Creative Commons.

Contract conundrum

Wed, 18 Mar 2009 04:00:00 +0000

Most people don’t enjoy reading the legal jargon that is found in contracts or agreements. It is confusing and overly-complicated. People want the rules to be easy to understand. This follows our Easy to buy philosophy. It is good practice to have a standard “Terms of Service” and “Privacy Policy” in place. No one enjoys introducing difficult-to-understand contracts at the crucial moment a customer is deciding whether to hire you or not. At New Leaders, we try to spell out our rules clearly on our web site and recommend clients review them in detail prior to getting started. If you are not familiar with how we conduct business, here is how we work:

1. We charge a flat $175 per hour.
2. We accurately account for only the time you use.
3. We do not offer fixed price projects.
4. Our estimates aim to be within 25% of the final cost.
5. We invoice Net 15; the 1st and 15th of every month.
6. We require no more than $4,200 as a deposit.
7. You can walk away at any time, no obligation.
8. We require you to pay for the work you request.
9. You own 100% of the work you pay for.
10. We request you utilize our services at your own risk.

These rules are so simple it is difficult to misinterpret them. Our goal is to make the process as straightforward and universal as possible. By doing this, we can cut down time spent in the sales process and pass that savings on to the customer. We don’t like long, drawn-out sales processes or jargon-filled contracts; so why would we subject our customers to them?

If you need to protect yourself from your customers, or vice versa, then you need to take a critical look at how you conduct business. Not every project is going to work out—it is a fact of life. By keeping the rules clear and simple you can minimize complicated legal discussions later. Your customers will appreciate your honesty and simplicity, and people who are looking to put the squeeze on you are thwarted by your common sense.

Try incorporating simple, uncomplicated rules into your business and see what happens. Like anything you create, be willing to revise or add basic addendums if needed over time. It is always a good idea to have your attorney review your rules to make sure your bases are covered. If you establish them correctly, you’ll have to answer fewer questions, suffer from fewer disputes, and more customers will say “YES!” more often.

This work is licensed through Creative Commons.

Seth Says...

Tue, 17 Mar 2009 20:28:00 +0000

The only thing worse than starting something and failing… is not starting something.

- Seth Godin, Author

http://sethgodin.typepad.com/seths_blog/2009/03/nothing.html

Not so fast

Mon, 16 Mar 2009 10:40:00 +0000

Do you dream of owning your own internet company? Maybe carve out a little service that is inexpensive to build, maintain, and profit from? It is a nice thought, but building, running, and making money off monthly subscriptions is much more difficult to pull off than you may think. I am not trying to put a damper on your dreams, instead I attempt to provide a more accurate depiction of the costs associated with trying to start your own software-as-a-service company.

I have worked with 25+ web-based software companies and I would like to stomp out any myths that make most people believe that this business is trivial to execute, inexpensive to maintain and will be acquired for millions of dollars. There are many ways to make money both online and off. Consider these truths when wanting to build a web based business.

Cheap and easy
The biggest and scariest myth is that building a web-based business is easy to do. For people who build websites or applications for a living, yes it is much easier and less expensive. But even for the most qualified designers and developers it still requires an investment of time. We built Electric Checkbook in 48 hours with 3 people. It’s free and serves as an easy to use single-entry ledger for thousands of customers. If we had performed the same work for a customer at our standard hourly rate, it would have cost nearly $35,000 to create the first version of the application. For that type of investment, we created a marketing website and very simple application. It took even more time to correct some bugs and add a few key features. The application is very simple and that is why we were able to create it so quickly. If we added the influence of a customer, subscriptions, and in-depth support, the price to build the application could easily double.

Subscriptions make money
I have had the unique opportunity to work with both direct marketing and software-as-a-service companies that use subscriptions to generate revenue. First of all, your least expensive or free plan will be your most popular. That means a majority of customers will pay no more than $5-$15 per month to receive 95% of the same services that your more expensive plans offer. While diehard advocates that need your comprehensive services don’t mind paying extra, they are the minority. Second, you need to consider retention and customer acquisition. Retention is how long you keep a customer after they signup. If you offer a 30-day free trial and you have a 1 month average retention prior to canceling, then you are not going to make any money. It is important to establish your retention rate prior to offering free plans or trials. Acquisition is the cost of getting customers to signup. If you are popular, costs can be next to nothing. Most of us don’t have the luxury of being instantly popular and must advertise to find new customers. Advertising is a very expensive proposition; if you go this route then you need to build the cost of interrupting users into your subscription cost, and also account for length of retention of that customer. Let’s say it costs $100 in advertising to acquire 1 new customer: if your average plan is $15 a month, then that customer must be retained at least 6.5 months before that investment breaks even. Think about that next time you want to offer a 30-day free trial.

It gets easier over time
You would think the initial push to launch your new product is the hardest you will need to work before you start making money with it. Untrue. Developers and customer service are going to significantly affect the bottom line—so much so that your company will reach an equilibrium. It will cost more to acquire new customers than it did in the beginning. The flip side is that your rise in popularity with a current customer base will increase support, bug fixes, and new feature requests. This will require your developers to spend more time maintaining the service rather than adding new features, which increases overhead. At some point your budget will only be enough to cover the costs of ongoing maintenance, and you’ll need to shovel advertising money out the door just to have enough profit to make any new significant upgrades to your product. It is a very expensive and vicious cycle.

Popularity versus profitability
The results are in, free applications are far more popular than their paid counterparts. If you want to charge $12 a month for a product that is only a little better than a product that serves the same need for free, good luck. Would you pay for Gmail? Probably not. It is a great app, but there are just too many great alternatives that are cheap or free to have to pay for it. Keep this in mind when devising your product and service. Building something that solves a real problem, that people want to use is one thing; building a service that people think is worth paying for is something else entirely. If you charge a subscription fee, that will significantly affect the amount of customers you have. If your goal is to dominate your space and be the most popular brand, then you may want to keep your product free and find an alternative way to generate revenue.

Selling your company
Only a very small percentage of companies get acquired. They are usually purchased because they provide a larger user base, generate revenue, have long retention, and low customer acquisition cost. Very rarely do they serve the purpose of augmenting the larger company’s family of products or offering a significant technology boost. After all, the company that has enough money to buy your application probably has enough to build it themselves – so it isn’t the technology they are interested in. What they really want is the attention your product receives, market position and the loyal customer base. If the generated revenue is large, that is a big plus. Ryan Carson recently posted a story on his process of trying to sell an application to another company.

”There’s no way around it: you’re going to spend a fortune on lawyer and accountant fees. We spent around $20,000 and the DropSend acquisition was very straightforward.”

”Do everything you can to structure the deal so that you avoid over-paying on tax.”

”One of the hardest things about selling a web app with paid subscribers is handing over the merchant account.”

”The buyer will ask you to prove that you are receiving the amount of revenue that you reported to them. The usual way to do this is send a faxed copy of your bank statement, so a separate account for your app makes this a lot easier.”

Ryan had been working for extensively to find a suitor for DropSend. Many deals didn’t work out and the process was quite involved. His article really explains the process and I think it is absolutely crucial to learn from if acquisition is your exit strategy.

Investing into applications
I have seen millions of dollars invested into the planning, design, and development of software-as-a-service products. While initially the ability to become the biggest vertical solution without any direct competitors seems realistic, it is much harder and expensive than you may think. We all can’t be lucky enough to receive a TechCrunch post that generates a ton of new interested customers at virtually zero cost, so the customer acquisition and retention rules apply. If it costs you millions to bring your product to market and you don’t have a strategy for keeping it fresh and acquiring customers at a very low cost, your investors are going to get impatient when they don’t receive their annual dividends. This will also affect your company’s perceived valuation as your fictitious projections meet actual market results.

Big ass SaaS
I know many companies that have taken on millions in investments, hired tons of people and set out to build a new product that will take the world by storm. The bigger the company, the longer it will take to create, and the harder it will be to maintain. If you have hundreds of thousands of dollars of overhead a month as you are trying to get your product off the ground, it is going to get difficult to generate profitable revenue. While your war chest may provide enough of a runway to get you where you need to go over the next few years, you have to consider that a better, less expensive product will come along to challenge your offer. My rule is keep it small, make money early, and drive the high costs out of the business. Most companies that accept huge investments will have to sell their company to provide returns to the stakeholders after the capital runs out. Alternatively, they can continue to raise large amount of cash in order to create a longer runway, but the same rules will apply sooner or later.

Note: 37signals executed the alternative option perfectly. They switched from being a paid consultancy to a subscription-based product only when the revenue and growth potential became sound. They didn’t try to force the product to pay the bills, they waited until it did. Try selling a service to the core audience first face-to-face. After you understand their needs, create a a web-based product with the resources you have on hand. Start as a service, evolve into a product.

To learn about their process checkout Getting Real.

The final word
I would like to sum up my advice. While these rules don’t really apply to the super popular or early-to-market, they do for anyone trying to start a new software-as-a-service company today.

1. Stay lean and mean to reach profitability equilibrium sooner
2. Understand your exit strategy as it will determine your route
3. It gets more expensive over time
4. Drive the cost out of acquiring new customers
5. Find ways to keep customers as long as possible
6. Subscriptions yield far fewer users than free alternatives
7. Avoid investment unless you really need it
8. It is much easier and cheaper for designers and developers
9. Try selling your product face-to-face, then create the online version
10. Patience is critical to creating a profitable service

I hope by providing some insight to what the challenges are for the majority software as a service companies it will help prepare you for whatever endeavor you embark upon.

This work is licensed through Creative Commons.

Refactoring communication

Wed, 11 Feb 2009 15:39:00 +0000

As software developers, we strive to find increasingly elegant ways to solve problems. Sometimes this involves eliminating foreseeable issues long before they occur. At other times, minimizing the Lines of Code (LOC) leads to the simplest solution. Optimizations of these improvements are multipliers that allow you to handle progressively complex problems with the same resources.

The quest for elegant solutions can apply to other aspects of projects as well, such as this example of refactoring a recent team/customer communication workflow. In this example we have two companies, each with two primary partners and interactions occurring between the four participants equally. This works for awhile, and can encourage the creativity and collaboration needed at the beginning of a project. However, as the number and specificity of the requests/responses increases throughout the course of a project, ensuring the delivery of each one, and their associated responses, can easily become a time intensive and error-prone activity. There is a better way:

Even with this nearly trivial number of participants, establishing a point person within each company can cut the lines of communication (LOC) in half, thereby allowing the two teams to transfer requests and responses in a more efficient manner. Requests and responses can also be batch-managed by the point people as the traffic increases. This chunking can also minimize the number of interactions that need to occur, saving the time that is typically required to find an open schedule time to meet.

Many things in our lives are systems. Which of yours can use a little refactoring?

This work is licensed through Creative Commons.

No Opportunity

Thu, 05 Feb 2009 05:40:00 +0000

When people say they aren’t interested in your idea, the natural reaction is to get discouraged or angry. After all, you’ve worked really hard and you feel it is a great idea, regardless of anyone else’s opinion. Pride in authorship is a really tough pill to swallow for most people. Hearing “no” is a good thing. You can learn a lot from a simple “no,” and conversely, very little from people saying “yes.” With a “yes,” you feel reassured that your idea is good and it will work; you spend little time analyzing why they agreed, and you are just happy with the act. You believe that you were right. When people say “no,” you spend more thinking about where you went wrong, and hopefully how to improve it. Getting it wrong lets you learn, while getting it right makes you feel good. But feeling good is fleeting. Receiving a “no” means you haven’t done a good enough job of convincing them of your endeavor. It is not that your idea lacks merit, but you’ve failed to convey why it is the right solution for them. If you create ideas, you have to be able to sell those ideas with passion. Next time someone tells you “no,” instead of accepting it and feeling upset, ask them — “Why not?”

“Why not?” allows people to agreeably communicate why they think it won’t work, why it isn’t right, and explore the ways it might fail. It gets them to think about it as a viable option, and extracts what they perceive as faults — all valuable information. In my business, I have seen many people frustrated when someone didn’t like the work they produced. They are often written off as crazy as a way to deal with any emotions they feel.

Selling is the art of convincing people you have the solution to their problem. When you finally hold a solution that people want to buy, selling becomes easy and inexpensive. Very little convincing is required for those who are ready to buy. If your product or service is expensive or difficult to sell, or you need to resort to trickery or games, then you need to step back and ask yourself — “Why do so many people say no?”

People refrain from buying for a myriad of reasons: media portrayal as a scam, poor reviews, too expensive, detractors, crappy customer service, product quality, etc. Instead of trying to sell or market your way out of these problems, you’re better off to redirect your resources into improving and preventing why people say “no” in the first place; systematically remove each and every barrier. I believe the people who don’t buy are just as important, or maybe more so, than the ones who do. Not only should you find a way to ask “why not?” to these potential customers, but you should embrace their “no” as a sign of more improvements that need to be made.

So, rejoice when people say “no.” Smile and ask them why. Respect the naysayers, haters, and detractors; their feedback can be some of the most valuable available. Isn’t it sweet revenge when someone who was an initial skeptic later becomes an advocate of what you sell? Consider that the next time someone says they aren’t interested in what you have to sell. I guarantee if you apply their feedback, it will get increasingly easier to convince others to say “yes” in the future.

Leap of Faith

Fri, 23 Jan 2009 15:45:00 +0000

Recently, I spent a little time reviewing everything New Leaders has accomplished in the last 18 months. From the creation of Electric Checkbook, Signalfire, our website, hundreds of articles, and many estimates to even more completed customer projects. Compared to internal projects, customer projects were dominant, requiring 90% of our time. It really is an immense amount of work in a very short period of time. What startled me is how our early customers provided much of the investment for us to get to the position we are now, all the while taking a major leap of faith on us.

For example, when we started we only had a nicely designed PDF file and a single landing page website for nearly a year. We had some examples of different projects we’d completed, but not even a full website illustrating our capabilities. Certainly we had a few prior contacts and our individual reputations which we used to secure clientele, but we provided very little information on what we could do for customers. While we still maintain relationships with some of our earliest customers, others have moved on. These early adopters that trusted us to deliver, provided us the platform required to create all of the assets we have today, and to them I will always be grateful. Without their business we couldn’t have made it as far as we have, nor as quickly. This is the very reason why I stress the importance of your business’ early adopters. While not all projects can be perfect, it is crucial to meet and exceed customer expectations whenever possible, especially those that trust far earlier than most people. These customers will create the backbone of your new business. If you treat these people poorly or things don’t go as planned, it is much harder to earn an authentic positive reputation that will create new opportunities.

Our first year was really hard and we made many mistakes. We believed in our hearts that with enough time, support, and opportunity, we would make it. When I think back to the very beginning of our business, I am saddened because we weren’t as operationally strong as we are now. If I could only go back and make things right with some of my customers, I most certainly would. But no one can change the past. What we can do is work hard when the opportunity comes to help those customers again, and do our very best to exceed their expectations. In the beginning, I expected new business to always roll in. While we’ve never had a shortage of work to do, I later realized that our early customers had a big leap of faith to endure, and that is why it was so much harder to find new opportunities than it is today. In the beginning, the idea of New Leaders was real but it took time to assemble the right team, put systems into place, and create a process that really works.

I think this lesson can be broken into a simple three part principle:

1.) You only have a few chances to get your business right. If you don’t succeed within a certain amount of time, it is lights out. Early customers are faithful, but only have limited patience to give. Early adopters are absolutely crucial to your future success; you’ll work twice as hard for half as much with your first customers.

2.) Now is the right time to find customers. We had a PDF and a single page website, and we built our business on top of that. It is never the right time to start selling your product or service — do it anyway. Things will never be perfect, and it is better to learn the lessons of selling your product or service as early as possible. It is never too soon to start making money, even if you just break even.

3.) You can’t avoid making mistakes, but you’ll need to work hard to minimize them. When you make a mistake you’ll realize what doesn’t work and find ways to improve that part of your process. You’ll learn from your mistakes and grow because of them. It is all part of the process.

I really hope these early lessons are helpful when launching your business, and realizing that starting is the hardest part. Too often, people believe that everything has to be perfect right out of the gate. The truth is that your product must be good and fairly priced for people to want to try it. Greatness and perfection can be acquired over time.

Twitter Groups

Wed, 21 Jan 2009 13:15:00 +0000

Since my discovery of Twitter years ago, I have been enamored with it. I always felt that status messages had a lot of potential for broadcasting your current state of being, whether mental or physical. But Twitter has gone much further as it exceedingly creeps toward critical mass. I believe there are three different ways to post your status on Twitter:

a.) Share thoughts and ideas with friends
b.) Receive traffic by sharing content with people who want it
c.) Mechanical turk for getting answers to questions

It is an incredibly powerful tool for getting the word out to those who granted permission to notify them of something new to share. Since the reader has control over who can notify them, they are able to prune their feed to their own personal taste.

Here is where groups could help. Initially, I used Twitter as a backchannel for web developers. It was open, transparent, and provided the opportunity for others to offer their opinion – like a fast forum or slow chat group. Over time, as more people became Twitter users, the conversation engaged a wider audience. Herein lies the conundrum; as more people join Twitter, the opportunity for group-related conversations disappears. Twitter is more of a broadcast and crowd sourcing medium than a communication platform. While it can certainly be used for both, it is now exceptionally good for getting the word out over being an open group messaging service.

I don’t follow too many people for this reason. I want to prune what I receive, and from whom. Personally, I barely follow 60 people. More than 100 seems like too many ideas to hear, links to be shared, or distractions to fall victim. Following thousands of people seems like a nearly useless feed, moving so quickly that you would miss something interesting from someone you truly care about. I don’t know if I am gaining the fellowship as quickly as others because I opt to pick who I follow. I could care less. For me, I would like to see Twitter incorporate a groups feature, allowing me to organize the people I follow in a way that is relevant to the information I seek. Since these playlists are merely filters, I can still view my entire feed, but I could add people to groups that I find to be relevant.

Simply adding a tab to the sidebar named “Groups” would barely affect the overall interface. Clicking the tab would reveal a standard page with a feed of the people you’ve added to that group. Much like the @ Replies section with the in-page sub-tabs, each user could have up to 6 custom-named groups. Although these people would normally be displayed in the main feed all at once, the specific people I select to display in a group also display in there. For example, I could have “Work”, “Family”, “Friends”, “Colleagues”, “Tech” and “Design.” A simple interface for changing group names is tied in, as well as an easy way to add people to multiple groups or remove them just as easily. What I have created are simple mockups of how I would unobtrusively incorporate these features into Twitter, and strategically place them so they require zero adjustment efforts and effects on the user experience.

These aren’t private groups. Instead, they are merely different ways to group feeds that are relevant to you. Assuming fewer feeds per room than your normal feed, their slower pace allows you to keep track of ongoing conversations or focus on a group of posts to find something of interest based on the grouping’s niche. A similar idea can be achieved today by creating various accounts and carefully following specific feeds on each unique account. By using a multi-account Twitter client, you can toggle between the accounts and each feed is organized in a similar fashion. Maybe this is a product idea for Twitter’s cottage industry; I think it is a missing feature of Twitter itself.

Now that they have added a few ways for people to find you, I think it is time to add a way to organize people into groups based on interests. This way we can use it both as a broadcast medium and a way to follow in a more organized fashion, no matter how many people we follow or follow us. In the above illustrated example of a currently followed profile, I have added a simple drop down box that asks if you would like to add the feed to a specific group. The issue is that it only allows you to add the user once. The alternative concept below is possibly a better method of adding people to groups, as long as it is kept to six customized groups.

I have added checkboxes to the six groups I have created above. By simply checking or unchecking boxes I can add this person to any group. To make changes, I simply click on the person in my feed and make adjustments. Now that we’ve established the benefits of adding groups and how to add or remove people, the next step would be setting up group names.

I realize that the Settings section is getting a bit overloaded lately, but let’s just say we put our group management settings in there. With this interface I tried to account for every possible request a user might want out of groups. This may be considered overkill, but I like to leave no stone unturned:

1. Use the cross hairs to reorder your group tabs
2. Click the checkbox to make the tab visible
2. Change the name in the text box
3. Click “View” to visit that group
4. Number of people assigned to each group
5. “Reset Group” removes all feeds assigned to that group

Make changes and they are automatically saved as you adjust them. I tried to make the UI as simple as possible while still keeping a large assortment of modifications available.

Ultimately, this is one way we can all begin to organize the people we follow, based on our own personal preferences.

Freelance Reform

Sat, 10 Jan 2009 04:30:00 +0000

Unfortunately, we work in a business that is powered by the greed of investors and entrepreneurs to succeed at any cost. While skills are what you need to get ahead in the world, a small percentage choose success by any means, even if it entails forcing you to work for nominal pay. It is a sad situation, and something we have to consider when working with customers that we have never met before. Prior to communicating our principles and our open and fair business policies online, we had a series of customer that would dangle paychecks in front of us to get us to do more of the work for nothing. It was demeaning and unprofessional. The sad fact is this remains the status quo for freelance web designers. In a buyer’s market, they decide when you get paid, and how much. I believe this attitude held by a small percentage of customers created an industry-wide price hike to compensate for customers running out on the bill, or wasting the designer’s time. The freelancer was forced to opt for large, painfully expensive deposits to offset the costs of the customers bailing, or the relationship suddenly ending.

When Robert and I started New Leaders, we knew in our souls there was a better, fairer, more practical way business could be done; a zero speculation process. Web designers were just fabricating prices based on hours they had never accounted for, and sending vague invoices equaling tens of thousands of dollars for services rendered. I recommended some really good San Francisco firms to my customers, and this is how the best of the industry behaves. Customers were tired of getting mediocre, overly-presented ideas that were unbelievably expensive. To add insult to injury, the customer not only paid through the nose, but then had to do a lot of the project management. As for results – good luck. In an industry that is supposed to make things easy, accountable, and practical, this was the shittiest business strategy ever. No wonder a majority of projects fell apart, and most customers became skeptical of web designers. I, too, was at this point.

That is when we realized there was one old school metric that everyone based their prices on, but no one seemed to track. It was time. Time that was accurately accounted for would easily indicate the cost of performing a service. I am not talking about saying a project took longer than it did to increase the price, I am talking about accurately tracking time and billing the customer for it. The value would then be in the hourly wage, not the perceived work, unlike most people would charge for. Everything in our business became painfully obvious and clear when we simply based it on accurate time. Estimates were more accurate. Customers didn’t argue the costs because they are inline with their expectations. The designers and developers felt they were paid to complete the job, and the company makes a little money.

When we did the math, it was simple. When we accurately account for time and the customer paid for only the time they used, we were able to create a sustainable business model. Customers could come back at anytime, request a few hours, and pay their bill online a few days later. It is simple, clean, honest, and most of all: works. The math works because when you charge customer inaccurately, it creates fraudulent data in your accounting. You can’t get a truly clear indication of the cost of paying people to complete the work, and how much the customer is paying for it. Estimates, timelines, and project plans become fiction; a disconnection from reality. By not accounting for time, you have no idea of your available inventory to sell or how much you have already sold. One hand does not talk to the other, all projects begin to slip, and the business slowly glides into chaos.

Imagine if Google didn’t track how many people click their sponsor links, or Apple had no idea of how many iPods they could sell. Something tells me they wouldn’t be very successful in their endeavors. Designers and developers need to consider each hour of their time as a physical product with a tangible value. By completely ignoring this idea, I have seen people working for as little as $1 per hour on a fixed price project, or even losing money in completing a venture to satisfy the customer. Losing money on something you were hired to do – the thought of it makes me ill.

Since your time is essentially free, the worse case scenario is that you break even. This means you got paid for your time, it took more than required, and there wasn’t a huge profit margin. That is okay. Some products go on sale to recoup their production costs; it is common in retailing. You have to look at that extra time that you may not be able to charge for as the discount on your services in order to accomplish the goal.

You should never take fixed price projects based on a deliverable or milestone. You can be absolutely sure that you will end up working for nothing as the customer continually moves the project goalposts, or ends up paying late. They aren’t bad people, it is just in their best interest to get the most work for the least possible, because those are the rules of the game to which you agreed. From their perspective, you are trying to do the exact opposite; a zero sum outcome, for you to win they have to lose, and vice a versa. You have to change the rules to reward customers for getting the project completed as quickly and cost effectively as possible. This won’t make for the juiciest windfalls, but it does create loyal customers that will continually come back to you and recommend more people to you. That will help your business grow, and you will continue to launch one successful project after another. It is fair, accurate, and honest, which is why we think it is the only way to succeed in this business. No monthly retainers, subscriptions, or massive deposits. Just good old hard work, by a talented person, paid at an hourly cost frequently they feel good about. It’s not fancy, but it works.

This work is licensed through Creative Commons.

Care more

Sat, 03 Jan 2009 01:00:00 +0000

‘Tis the season to be thankful and giving. I wanted to put a seasonal twist on an age-old idea; caring more about your products and services – more than anyone in your position ever has. It doesn’t matter what part of the business, or who is in charge of it. You should interject your personal opinion on how things could be or should be, if given the opportunity. Caring is essential to creating loyal customers and amazing products. When you care more than you should about things most people don’t, it adds a bit of magic to the experience. Even boring businesses can add a bit of sparkle to their products or service by looking at them from the customer’s point of view. It isn’t hard; just ask yourself, “what would make this awesome?” When you stop for a second and really see how an outside person perceives your offer, you’ll realize there is a universe of ideas to help improve it.

Some things take only a moment and cost nothing at all. Others are huge and take massive amounts of change and expense to implement. Both are right answers. Prioritize from the smallest to the largest while always aiming for the big changes. As you adjust things over time, you’ll see positive changes begin to unfold, and you will ultimately reach your goal. It is not as hard, expensive, or time consuming as you might think. Actually, since you only do little things one at a time, you barely notice the time or money invested to fulfill your dreams and aspirations.

It’s like snowflaking your ideas. Snowflaking is a financial strategy for throwing small amounts of money at debts every day. Most of us wouldn’t notice a difference if we sent twenty bucks here and there. If you pay that small amount to any debt almost every day, your interest rates lower, the debt gets paid off, and you barely notice the investment you outlaid.

But first, before you can add the little bits of magic that set your course for dream realization, your mindset has to be in a good place. Not only do you have to enjoy the work, but you have to really love it in order to care about every aspect of design, manufacturing, sale, and delivery. That is why Apple was so excited about crafting a laptop out of a single piece of aluminum. While the consumers think it is cool, they were thoroughly impressed with their own ingenuity. They care more than we do; you can tell.

Self-centeredness is traditionally considered to be a bad trait. But maybe not for a company. While I believe business should be both aware of the market and socially conscious, they should also be incredibly self-centered toward their own process and products. The companies that are obsessed with the experience they provide customers are the ones that care about the little aspects their business makes special.

In the words of Seth Godin, “Good is very bad.” He is completely right. Run of the mill products and services that cater to the needs of everyone pretty much suck. That is because they subscribe to a “good enough” policy, and never challenge what works. While they may survive at the top for awhile, their outlook almost always looks grim. This is because no one in the business cares enough to make a change for the better. By the time they figure it out, it is too late and the consumer has moved on. I believe this is what happened to Yahoo!, and now in the face of complete failure, they are ready to give it a go – ready to care again. Hopefully for their sake, it isn’t too late to turn it around.

When you care more than others do, it inspires. That makes others care, too. Many businesses fail because they have a hard time generating organic attention for themselves, and interruption media is far too expensive. If you don’t care enough to make your business special, it is almost impossible to get anyone outside of the company to care either. If your service is too expensive, slow, or the product you produce isn’t very good, then don’t expect to receive stellar results.

I am not claiming that New Leaders makes the best stuff on Earth, or that our process is perfect by any means. What I will claim is that we care. We care about each support email we get. We care about each customer that hires us, and we are thankful for every opportunity that comes our way. Every day we talk about a new way we can improve the way we do something; anything; everything. We are a small team of people that care way too much about design, code, and customer service – even to a fault. We look for ways to make it faster, easier, and cheaper in order to make the entire customer experience better. There is a higher principle at work than simply making money, and that is to be the very best at every aspect of what we do. If we take care of our customers, they will be sure to take care of us.

Try caring about the little things more. Be thankful for the opportunity to act on a recommendation you received. Do what you can to improve your everyday tasks, even just a little bit, and I promise both your team and your customers will care more, too. Make that your New Year’s resolution — care more.

Don't back down

Wed, 31 Dec 2008 10:00:00 +0000

Persistence is the difference between success and failure. You must be willing to stand your ground, see things through, and live to fight another day. Survival is success and don’t let anyone ever tell you any different. I believe companies fail because they choose to. Instead of keeping the pressure on, they become complacent or lose the love they have serving customers. The entrepreneurs that don’t take “no” for an answer are the ones that see their dreams come true. Leadership is not measured by how you behave during the good times, it is measured during the bad times.

In the current financial climate now is not the time to fold; rather, it is the time to push forward, draw on every asset, and utilize every available resource to make it through to the other side. If you close your eyes you can imagine a time when all this will be far behind us; a stronger, smarter economy that rewards the companies that provide value and generate real revenue. Gone are the times of cheap money and free rides. Now we all have to work together to rise above insurmountable odds; repair our economy, environment, and the well being of all Americans.

Now is the time to see what we are truly made of. Our generation may be the most entrepreneurial in all of history. The world is in a state of decline and this is our opportunity to fix the broken systems created by previous generations, that bore this instability. This is our chance to rise to the occasion and remake the world as we see it. There are so many opportunities: from better financial tools, smarter healthcare, more agile government, and cleaner technology. Everything is up for grabs. It is almost like someone hit the reset button, allowing an entirely new generation of entrepreneurs to define the way these industries will take shape.

I urge you to take control of your destiny. Pay off your debts, cancel what you don’t need, and approach everything with honesty and practicality. The sad truth is that most Americans are broke, overweight, or dumb. This cannot be the status quo. We have to repair the damage that has turned the American dream into a nightmare. We have the power to right our course if we work together in a common language. Barack Obama calls this “CHANGE.” I believe he is right – but our new President can only do so much. It is up to each and every one of us to make a difference.

At New Leaders, we have a motto that has helped us to keep our focus: “If we succeed we will do so together.” This is no longer a zero sum game. For me to succeed, others will lose has been the standard operating procedure for too long, and it has lead us to this point. It is time for a new strategy, one in which we help each other to mutually succeed. There will soon be an entire world of competition and Americans need to work together to hold our standing, repair the economic and environmental damage we’ve done, and remake it into a better world than it was given to us.

I have watched our generation bend industries to our will. The music industry is a perfect example of the people taking the power back and inventing new ways of rewarding the artist. We are a long way away from seeing this come true, but it is within reach. The media is now being democratized and this is only the beginning. Everything will change to more beneficial business models that reward the people who make it happen. You can be one of these leaders; just ask yourself what you are most passionate about, and how can it be executed in a mutually-beneficial way. Therein lies the opportunity you’ve been waiting for.

There are no more ploys, tricks, or easy money. Now is the time to get real, to create the world we always knew could exist but has never been attempted. Don’t back down, don’t give up, and don’t take “no” for an answer. Put pressure on the system and demand that it works the way it was supposed to from the start. If it breaks under the pressure, find a new way to fix it so it is optimized and beneficial for all.