Taking Vacations Can Make You Money? via Million Dollar Journey
Efficiency isn’t a Sellable Value Proposition via Instigator Blog
Cheap Unlocked Phones via ongoing by Tim Bray
I have an unlocked Nexus One with a pre-release of Android 2.2 “Froyo”, and
I have a T-Mobile mobile data plan from Google; I imagine that, like most big
companies, we get a pretty good deal on it.
As of now, I’m never paying for Internet in a hotel or airport again.
You can turn the Nexus One into a WiFi hotspot is a matter of a couple of clicks.
It turns out that other Android phones like the Evo and the Droid X offer this
capability, but because they’re sold through and locked by the network
operator, you have to pay extra for it. Similarly for modern iPhones. For a
heavy traveller, the amount you pay extra may well be less than you’re
currently paying some combination of hotels and Boingo or equivalent.
But if you get an unlocked phone, the network operator would have to...
Indie Android Interview via ongoing by Tim Bray
I was doing “Office Hours” at
Google I/O, and this guy
walked up with a question and we got to talking. His name is Derek James of
Polyclef Software; he comes
from a different planet from the one this Web guy has been living in, one
where Psychology Ph.D. candidates build actual real businesses, starting part-time, via
single-handed mobile-device programming. I did an email interview with him.
Numbers
Tim: Let’s start by establishing your credentials. I’d say that by
most metrics, you’d rank as a successful Android game developer.
Care to give us some numbers?
Derek: Sure. First of all, I don’t just develop games, though those
are generally my more popular apps. In terms of quantity, as of now my apps
have over 300,000 combined downloads. As for quality, I have over 10...
WordCamp Vancouver 2010 Wind Up via Vancouver Blog Miss 604
This weekend we hosted WordCamp Vancouver at the Museum of Vancouver. This is my second time co-organizing a WordCamp and it was a lot of fun to put together.
Photo credit: John Bollwitt on Flickr
My company builds, develops and designs websites using the WordPress platform and by organizing these events, we have a way to give back to the community. Now although “Camps” in the social media realm usually mean unconferences, the WordCamp model hasn’t usually operated that way. We hosted a structured one-day conference all focused on WordPress operations and development — and it was a blast.
My co-organizer, Duane Storey, published the following on his blog:
There were a bunch of highlights for me throughout the weekend:
1) A couple of the sponsors came up... Disclosure re Twitter via ongoing by Tim Bray
A while ago, I made a small investment in a Vancouver company called
Smallthought Systems, which has now been
acquired by
Twitter. Thus, I am now the owner of a small number of Twitter shares,
and may fairly be suspected of bias when discussing that company. I continue
to admire and use Twitter, and also continue to think that it’s a bug when an
apparently-fundamental medium for human communications is the product of a
single......
Windy via ongoing by Tim Bray
Canada has long been a telephone oligopoly:
Rogers,
Telus, and
Bell Canada; Canadians generally feel that prices
are high and service only so-so.
Now we’ve got a new mobile player, Wind
Mobile. I signed up as soon as they got to Vancouver, at least in part for
reasons of ideology; competition is a good thing. So far, Wind looks like a
good thing too.
Mobile network operators make it tough to compare prices, but Wind claims to be
quite a bit cheaper. I’ve been paying Rogers through the nose because I got a
package with unlimited US roaming, and some add-ons to (somewhat) reduce the
data-roaming pain.
It turns out I can get a corporate SIM card from Google to ease the
in-the-US pain; and then Wind sells unlimited calls to the US for
$10/month. This is going to create some...
Play-by-Play: Fixed and Unknown Costs via Craig's Linked List
Unlike the variable costs, some costs are roughly constant regardless of how many customers you have. Paying for these costs is why it’s so important to have high margins and high customer volume; there’s a hurdle to overcome before the business is bottom-line profitable.
Legal
Legal costs aren’t much fun but they are necessary. I’m estimating roughly $1000 per year in basic legal costs. If I actually get sued then it’s another ball game entirely. The lesson here is “Don’t Get Sued.” Also, there’s roughly another $1000 in one-time legal fees during incorporation.
Insurance
Liability and business insurance are good safety nets to have; they will hedge against potentially catastrophic losses. I’m estimating $2000 per year...
Forum for Women Entrepreneurs: Ticket Giveaway via Vancouver Blog Miss 604
The Forum for Women Entrepreneurs is a local social group dedicated to networking, mentorship, and educational programming for women in business. On Thursday June 3rd they will be hosting a special event that will celebrate 14 entrepreneurs in the “e-series” category.
What The Entrepreneur Affair (previously known as the graduation event)
When June 3, 2010 5:00pm – 7:30pm
Where Birks Vancouver Flagship Store (698 West Hastings)
The event will feature guest speaker Barbara Ross-Denroche (The Refinery Leadership Partners) and the 14 women entrepreneurs who are being showcased. The list includes Heather Huntingford (Kiss & Makeup), Debbie Collins (Soya Marketing), Traci Costa (Peekaboo Beans Inc.), Deborah Drummond (Metropolitan Aromatherapy) and more.
There is a... Corporations and Emotions via ongoing by Tim Bray
Is meaningful or useful to have emotional reactions to business
organizations? Right now there’s a lot of that going around;
the atmosphere swirling around my employer and That Fruit Company a
short commute away in Silicon Valley grows steamy. Which pales
compared to the global outpouring of fear and loathing directed at a certain
English oil corporation. I’m going to argue (after some personal digressions) that
hating on BP is perhaps actively harmful.
Personal Digression
Recently I
tweeted (and I
apologize for the coarse language): “Unlike apparently everyone, I’m not
pissed at BP. You gonna live on fossil fuel, shit gonna happen. BP drew the
short straw.” Which didn’t seem to me that radical a thing to say. It’s far
from established that BP is significantly worse (or...
Play-by-Play: Variable Costs and Margins via Craig's Linked List
I did the revenue analysis; now it’s time for the expenses.
Variable Costs
These are expenses that are directly proportional to the number of customers you have. More customers = more variable costs.
Hosting
For a cloud-based web application, the costs are pretty small. Heroku charges $19 per month, plus variable fees for higher-concurrency. These fees are based on per-second usage, so they scale directly with customers/sales. They’re also very cheap: 5 cents per dyno per hour; a dyno can handle around 10 to 50 customers per second. Given that I’m only expecting 250 non-heavy-duty customers total, the variable costs should be tiny. I’d guess that the app could be hosted for less than $100/month, or $1200 a year. The cost per customer is about $5 per year. Chump...
Play-by-Play: Revenue Model, Indecently Exposed via Craig's Linked List
I want to publish some analysis regarding the costs of running this business/application. However, to make any real impact, I have to publish the revenue numbers too. I originally said I wasn’t going to do that, but I think it’s worth doing so now given my next post. That, and Teflon Ted said I’d be uncool if I didn’t.
Answers to My Questions
Q: How much on ingredients does the bakery spend?
Depending on the quality of ingredients anywhere from $1000.00 – $5000.00 per week
Q:How much of the overall waste could be eliminated through better
planning (via the product we want to build)?
I would say that there is always waste, any more than 10% can be very detrimental to a small bakery, especially on a daily basis.
I think if done properly and the bakery...
I/O 2010 Words and Faces via ongoing by Tim Bray
I worked like a madman right through
I/O 2010 and went
straight from there to an internal meeting and from there to my Mom’s
80th-birthday bash, so there hasn’t been much time for reflection. I
can’t find a theme to organize my notes by, so what you get is a dozen
poorly-sequenced take-aways interspersed with seven faces.
The faces are here because I did a bunch of short interviews with strangers
and got the idea of pointing my
40mm pancake
prime at people straight-on and close-up, and found the results compelling
enough to share. I don’t know all the names so I won’t mention any.
1
Moscone West is an immensely nicer place to spend a couple of days
than either North or South. Although it’s big, the size gives it a feeling
that’s airy not brutal, and it’s full of...
Play-By-Play: Revenue Model via Craig's Linked List
As I mentioned in the last post, almost all of the competitors are one-time purchases. I however am leaning strongly towards a pay-as-you-go model, probably on a monthly basis. This has some major advantages for the customer and for the seller (me):
The customer can start using the software without a major outlay of cash. (A startup already has plenty of initial major outlays, especially in equipment-heavy industries like a bakery.) This in turn is good for the seller as it gets customers in the door earlier. The key is to engage the customer as early and as easily as possible.
There’s much less risk to the customer. If they do not want to use the software any more, they simply do not pay. All they’ve lost is their current fees, which are bound to be much less than a...
Play-by-Play: The Architecture via Craig's Linked List
A pay-as-you-go service goes hand-in-hand with a web-based application; it’s much harder to make a viable one-time-purchase web service or a pay-as-you-go desktop application. This choice of architecture has several benefits of its own:
Lower (nearly zero) maintenance for the customer. There’s no software to install and no servers to operate.
Easier compatibility concerns for the developer. Modern web development is very consistent across platforms (assuming you choose not to support Internet Explorer 6 or less. Even if you target modern Windows exclusively (and that probably means abandoning the huge XP installed base), desktop software has to contend with a huge number of variables for each local installation.
Easier distribution of changes, fixes, and enhancements. This...
Being at I/O via ongoing by Tim Bray
The facility, Moscone West, is jam-packed to busting; the organizers
slammed on the attendance brakes weeks back, worried about militant fire marshals,
breaking the hearts of outsiders and Googlers alike. It’s a nice building,
full of light even in a grey California spring.
Apple and (formerly) Sun and Oracle have always plastered their branding
all over the city for their conferences; Google does none of that, except for
a single big Google-Maps-style location marker outside the venue.
The crowd is eclectic; more Android fans than any other sub-group, but lots
of other kinds of people too. Geeky. Male. All ages. Friendly. Eager to
laugh and applaud. Tolerant of slow patches in keynotes.
Here’s our Vic Gundotra launching the Day One keynotes. Vic is
super-polished; so much so...
BlackBerry Apps: Looking for a Developer via Craig's Linked List
A potential client just approached me with an idea for a BlackBerry application. The application itself is pretty simple; the business logic is already vetted and the UI requirements aren’t complicated. However, I’m not familiar with J2ME and BlackBerry development (though I have been doing Java for years). That means my personal learning curve would put a relatively heavy burden on this project. Instead, I’d like to find someone already doing BB development and farm at least some of the work out to them.
If you’re interested, please contact me and we’ll start talking about the......
Play-By-Play: Business Analysis Update via Craig's Linked List
I just got some responses to my market questions from my domain expert.
I’m debating whether to post the raw numbers here. This sort of research is generally considered an important competitive advantage, and thus should be private. On the other hand… I didn’t really do much (besides ask a baker), and so anyone who wants to compete should be able to go out and find similar results. Furthermore: my competitive advantage will be on the implementation side, not the market analysis side.
Still, it’s not terribly harmful to withhold publishing these numbers to the general Internet. The only thing I really lose is the credibility boost from showing my analysis process.
So, for now, I’ll keep the numbers to myself… but if you’d like to see them...
Enterprise Software Can Be Fun via Instigator Blog
Play-by-Play: Getting Customers via Craig's Linked List
This is a continuation of my previous post.
Conversion Rate
Here be dragons. I’ve yet to see anyone come up with reliable predictions or techniques to make a paying customer out of a potential one. In fact, a lot of what I’ve read suggests that you should not even try to estimate or manipulate this figure until you’re already in business and have some existing data to work from. Until you have real numbers, it’s all guesswork.
The good news is that the number may be even better than you think. There have been lots of runaway successes in the Internet age. Also, this is where all of the upside comes from once you’ve built the business. Today’s battle plan is to launch the business and then use real-world experience to increase this number.
I think...
Play-By-Play: Personal Cost/Benefit Analysis via Craig's Linked List
There is an infinite stream of problems to solve. However, finding one that’s worth working on is another matter entirely. Nothing comes for free, so we have to pick and choose what we focus on. Here’s some of the questions that I’ve asked during the course of my investigation.
The Ultimate Question: Should I Build This?
Q: Is this particular project worth my investment in time, effort, and money?
“Ultimate” has two connotations: last and most important. This question fits both of those; not only does it override everything else, but it’s only answerable after you resolve all of the underlying questions. However, it’s easy to lose sight of goals, so it needs to be asked first. This is where we can apply a fringe benefit of being a programmer:...
Play-By-Play: Business Analysis via Craig's Linked List
So, we have the problem defined and have estimated that the project is a good one to do — if its profitable. So how successful will it be as a business? Nobody can reliably predict the future, but we can take a shot at it and see what we learn along the way.
The Fundamental Equations
Profit = Revenue (Income) – Expenses
Profit also = ( Margin * Number of Sales ) – Fixed Costs
Revenue = (generally) Number of Sales * Sales Price
Margin = Sales Price – Cost
Cost = What you make of it
Sales Price < Min( Value to the customer, Price of competitors with same value)
Number of Sales = Number of potential customers * Conversion Rate
So let’s try to fill in some of these numbers.
Number of Potential Customers
The target audience for the immediate problem is...
Play-By-Play: The Problem via Craig's Linked List
Pretty much all software is intended to solve a problem of some sort. The “problem” simply be “I want to be entertained”, but for “business” software it’s usually more specific. Ideally it’s tied to a profit-generating function. You’ll sometimes hear them referred to as “pain points”, “challenges”, “requirements”, or “opportunities”; they’re all really the same thing.
A few weeks ago I was approached by one of my wife’s friends. She’s opening a bakery here in Calgary and asked if I would be interested in creating some software for her. We met, discussed her needs, and I got a bit of understanding about her industry. From this I derived the major problem that...
Play-By-Play: Building an Application via Craig's Linked List
In addition to my “day job” as a software development consultant, I’m also evolving into a software entrepreneur. I want to sell products and not just my time. Over the past few years I’ve seen a lot of people accomplish the same dream (most famously the inspiring guys at 37signals). I’m going to try my hand at the same.
In concert with this, I’m going to document my development process, tasks, and ideas. I’m doing this for several reasons:
To potentially inspire and instruct others to do likewise.
To perhaps get some feedback from the development community.
To document my processes for my own reference, benefit, and reflection.
To build my cred by illustrating my thoughts and capabilities. (Better to show than simply to claim.)
I hope to...