It wasn’t until several years after the company was up and running that they realized it would be a good idea to sell any beverages at all. All they sold was beans.

It’s inspirational to think that a successful company like Starbucks had a much different business plan when they started. The company made $5.4B profit this year off people like me who, despite having some excellent Guatemalan beans and a working percolator at home, frequently find myself weekday mornings in a drive-thru line a dozen cars deep.

The business world is full of stories about companies who started in one direction and ended up finding success by doing something completely different. It’s easy to hear these stories and nod with understanding — we all want to believe that someday we’ll get struck with the perfect idea, slap a $4 price tag on a cup of espresso and milk, and retire with billions.

So if it’s not too late to tweak your business plan, then it’s never too early to start with a failing business plan. I think too many people get crippled by trying to find the perfect idea that they fail to get anything started. Would Starbucks have been in a position to execute their current plan if they hadn’t started out with the wrong one?

I often find myself crippled by this fear of failure. When I do something new it’s often because I just made a deliberate decision to close my eyes and take a leap. (Sometimes it’s just because I skipped my morning coffee and couldn’t think straight).

It amazes me to look back at some of the stupid things I’ve done because I don’t remember where I found the confidence to do them. Like how I left a good management job at a Fortune 500 company to start Recursive Function with a shaky business plan, unimpressive savings, no outside income, and a newborn baby. It’s not that I had the perfect idea – I just took the leap.

Out of college, some friends and I founded Bottled Software, my first startup company. We were very naive in our estimates of how successful we would be, made a lot of mistakes, were paid terribly, and ended up closing the door after a couple years of business. But I wouldn’t trade those failures for the equivalent time as a junior programmer at Google or Microsoft. Much of what I’m doing now came from what I learned at Bottled Software, and I can certainly say that I’m starting to make espresso now only because I sold coffee beans many years ago.

I’ve had a lot of failures, but they’ve all put me in a position to create new successes (and failures) — something that definitely wouldn’t be true if I had done nothing at all in the first place.

Anyone have some good stories about their coffee beans?

2. Speaking of the North Pole, this is the funniest Santa picture I’ve ever seen:

3. Get $50 at FormSpring’s holiday contest - all you have to do is make a free form with a holiday theme and link to it in the comments on the FormSpring blog. We’ve got a few funny entries so far, but are hoping for more. The contest ends Dec 31st.

4. Three men dressed up as elves - elfyourself.com is a site where you create personalized videos of dancing elves, laugh hysterically, and send links to the videos to everyone you know. Then you realize that you’re a much cornier person than you thought, and hate yourself for ever visiting the site. This is one that August was kind enough to put together, starring the Recursive Function team.

Links

1. R.I.P.: The Web 2.0 Office Suite - Ninety-four percent of U.S. consumers have never heard of Web-based productivity suite alternatives. A mere 0.5 percent have substituted Web-based productivity suites for desktop software such as Microsoft Office.

Techcrunch makes good points about problems with the survey and Douglas Karr sees the stats as a rallying call for marketing and an incredible opportunity for growth. I definitely don’t see Google Docs killing Microsoft Office anytime soon, but it’s way too early to say the war’s over.

2. Web 2.0 Can Be Dangerous - AJAX, rich Internet UIs, mashups, communities, and user-generated content often add more complexity than they’re worth. They also divert design resources and prove (once again) that what’s hyped is rarely what’s most profitable.

I think Jakob is mostly right, at least when it comes to content-centric websites. Ajax and rich UIs are essential for web applications, but can easily be misused. Developers should always build for the user first, not for the technology. And even though I seem to say so otherwise, I think money should be spent on the bells, whistles and yellow fades long after version 1.0 is up and running.

3. Lack of Funding Most Common Reason to Bootstrap - Only 38 out 100,000 new businesses reported receiving venture capital funding. Another way of looking at that is that of all estimated 650,000 new businesses that will start this year, only 247 will have had funding from venture capital.

That number sounds counter to expectations, given the amount of coverage venture-backed businesses receive. But the takeaway is clearly that if your new business plan relies on getting VC, then it’s wise to have a backup plan. You’re smarter than VCs anyway.

4. Bosses behaving badly - In August and September, as his company is racking up the largest quarterly loss in its 93-year history, Merrill Lynch CEO Stanley O’Neal squeezes in 20 rounds of golf, including three rounds on three different courses in a single day.

He should definitely be criticized for getting a $161.5M retirement package when performance was terrible. But to be criticized for playing golf? Wasn’t most or all of that on weekends and holidays? Should people not get any time off work if they’re not meeting expectations? Isn’t it healthier to relieve stress on the golf course rather than at the office?

5. Blogs in Plain English - A video for people who wonder why blogs are such a big deal.

Another well-done CommonCraft video. I’m guessing most of the people who haven’t heard about Google Docs need to watch, so please share

You never get to do things the right way. You always have to do things the expedient way…. as soon as your program gets good enough, you have to stop working on it. Once the core functionality is there, the main problem is solved, there is absolutely no return-on-investment, no business reason to make the software any better. So all of these in house programs look like a dog’s breakfast: because it’s just not worth a penny to make them look nice. Forget any pride in workmanship or craftsmanship you learned in CS323. You’re going to churn out embarrassing junk, and then, you’re going to rush off to patch up last year’s embarrassing junk which is starting to break down because it wasn’t done right in the first place…. When you’re working on products, you can keep refining and polishing and refactoring and improving, and if you work for Facebook, you can spend a whole month optimizing the Ajax name-choosing gizmo so that it’s really fast and really cool, and all that effort is worthwhile because it makes your product better than the competition.

Joel couldn’t have said it any better. Great programmers are craftspeople, and like designers, musicians or writers, they have a strong sense of pride in their work. They want to create something that’s great, not something that just gets the job done. They also want to work with and for people who value the work in the same way. It’s no fun working for management who just wants to know that the job was accomplished as cheaply as possible.

I have to admit this is one of the reasons why I started my own software company. I wanted more control over the work I did. If a new client comes to me with work that seems absolutely boring or a time frame that makes it impossible to do the job right, I have the option to turn it down. If I want to spend the next three days working on an Ajax gizmo just for the fun of it, then I can do that. Sure, I have to worry about the profitability of turning down clients and spending time on non-revenue projects. But I’d rather come to work each day feeling motivated, and leave feeling proud of the work I did, even if that means that I don’t make as much money as the next guy.

It sucks for companies too

From a December 2007 SBA study:

It was once assumed that college graduates would graduate and then go to work for a Fortune 500 firm; that is still true for many people. What is also true, though, is that more students today see entrepreneurship as a viable option for their careers.

I have to assume that since more students look to starting their own business, and since it’s getting easier for them to do so, it’s going to get harder and harder for non-tech companies to find good programming talent. Especially since they already have to compete against guys like Joel who convince them to go work for Fog Creek and get lots of really cool perks.

And it’s getting worse and worse for those companies as good software becomes more important to their business. Customers expect the same experience from the e-commerce website of a HVAC company as they do from Amazon. And if that internal workflow software really worked as well as applications like Gmail, then maybe production costs could be cut enough to remain competitive.

Or will dependency on technology ultimately drive good businesses to manage their IT departments like software companies? Where does that leave everyone else?

I am quietly distancing myself from my pet project, my baby which I poured my heart and soul and mind into…. We invested 30,000 US$ of our own capital, excluding an estimated 50,000 US$ of sweat equity. With that, we built a working prototype but did not manage to get a customer-ready product out the door. No customers equals no revenues, and since we have not yet secured additional funding, we are officially stuck.

The story of a failed dot com startup with a so-so idea, an inexperienced team and weak business model is not unique. But Philippe’s transparency is refreshing, and it’s definitely worth the read for anyone who’s working on a startup.

Philippe: while the situation might be excruciatingly painful now, I’m confident that when the dust settles you’ll be sure that it was better to have failed than to have never tried at all. Best of luck on your next venture.

We welcomed Jax on October 17th, and he’s been a blast (even if he does have days and nights confused).

On a related note, I was speculating recently with another father about the effect blogging will have on our kids when they grow up. Will kids be surfing the Wayback Machine in middle school computer labs looking for each other’s baby pictures? Is it too much to hope that kids will actually think someone’s cool because their dad blogged about them, and not the other way around?

I’m still not completely convinced otherwise, but am starting to see the appeal.

I think my initial skepticism was largely founded on the way Twitter had been explained to me, and the examples I’d seen in conjunction. I don’t see any appeal in it as an instant messaging platform (my Pidgin client works far better for this purpose), or as a way to peek in on friends in real-time (I don’t really care that you’re eating leftover fish tacos right now).

But I do see appeal in Twitter as a micro-blogging platform — a medium to publish relevant content, much as you would with a personal or company blog. The content limitations of Twitter (no post can exceed 140 characters) free me from the pressure of having to write a lengthy, time-consuming post. If I want to write about an event or interesting article I can do so in under 30 seconds. It’s rare that I can put together a coherent blog post in under 30 minutes.

However, using Twitter as a micro-blogging platform might not be a good thing. The most obvious problem is that generally speaking, content under 140 characters is going to be of far less quality than a lengthier blog post that has a lot more time behind it. And there seems to be a growing list of bloggers whose blogging time and mind share has been cannibalized by Twitter. There are signs that it’s done the same to me, although I can’t really use it completely as an excuse since I wasn’t really posting that frequently before using Twitter.

If you haven’t looked at Twitter at all, or haven’t given it a second glance since you scoffed at how ridiculous it was, I encourage you to give it another look. There’s some value there … I think.  And you can follow me here or subscribe to my RSS feed.

If you have given it a second look, I’m curious to know: what made you decide to start using it? Or what made you decide firmly that you’ll stay far, far away?

I have 49 friends in que waiting because I sent them this message…

I’m quite all right with limited friends on my facebook, therefore I have put limitations on who I will accept as friends. Ah… this is where it gets fun!

I’ll accept our “Facebook” friendship if you fulfill one of three stipulations: 1) Come to my house and watch me personally accept your request 2) If you live outside of Indiana, send me five “good” reasons why I should complete your request or 3) buy me lunch!

I mean come on… our friendship has to mean more than clicking “enter”!

I absolutely love that he’s doing this. With social networking sites there’s too much pressure to build up a big network and invite anyone that you’ve ever met. I’m frequently getting invites from old high school and college classmates that I barely knew then and haven’t seen since. It’s good to get back in touch with many of them, but does “clicking enter” really help us get connected again?

I went through a phase where I tried to rapidly build up my LinkedIn profile. What if I made it a point to have lunch with all my contacts at least once every 6 months? I couldn’t even begin to imagine how much more meaningful that would be. It’s just too easy to otherwise feel like we’re connected because we’re in each other’s list of contacts, or get the occasional status update when we change some text in our profile.

How many fewer Facebook friends or LinkedIn contacts would you have if you had to buy them lunch? (By the way, soup does count.)

Exceptions can be made if you’re a blogging expert, or an author of blogging software. Otherwise, readers don’t want to hear about how you really really promise to start blogging frequently, even though you’ve barely posted in the last few months. Just start doing it, and we’ll believe you.

I know I just broke my own rule. It was in a subtle way though, so it doesn’t really count.

Here are a few of the things I’ve been up to lately, and may or may not blog about in the coming weeks:

• Getting the house ready for my second son, due in about 8 weeks
• Releasing version 2 of a really incredible online form builder
• Working with a great Indianapolis web designer to build the new Recursive Function website
• Getting ready to move down the hall into new offices
• Catching up on episodes of the 2007 World Series of Poker