Archive for March, 2007
Inspired by my participation in a panel at SXSW, this post is one in a series of posts regarding the building and operation of web application startups. Many of the questions posed to the panel were about expectations; this post endeavours to ground expectations of aspiring entrepreneurs in reality, by highlighting the stories behind a handful of successful web apps.
When you start anything new – like a business – you need to set expectations. It`s my belief that this is one of the most important steps in determining your success – set your expectations too high and you`ll think you have a failure when you might just have a winner – set your expectations too low and you might squander a great opportunity.
In this context I`d like to talk about building web apps. A lot of people are building them these days – many in their spare time – and I get the sense many are starting off with a false set of expectations.
Over the past few years there have been a handful of companies that by all accounts have been very successful. There is YouTube, Flickr, 37signals and Writely to name a few. Many would-be web application developers have seen these successes and figure they can replicate these successes and it will be easy. In my books this optimism is great – so long as those entrepreneurs set their expectations correctly.
In almost all of the cases outlined above, the companies had something going for them when they launched. 37signals had a loyal audience of readers at their truly excellent Signals vs Noise blog – so their audience took care of marketing their Basecamp project collaboration service when they released. That`s not to say their product wasn`t great and they aren`t very very sharp. I am only saying they had a asset most companies don`t have when they launched – an audience. Writely is another great example. Here`s the back-story on them. Basically they were document management veterans. I could go on but I won`t.
These successes caught the imagination of the press and others – but the point I am trying to make is they did not come out of thin air. So if you are building a web app, don`t expect yours to. We did not have a paying client for almost two months at FreshBooks – by many accounts that constitutes a failure. But we’ve hung in for over three years. We kept improving our product, refining our pricing and spending money marketing a product we always believed in. I like to think our expectations and our faith were well placed when we started – despite the initial lack of results. But we had an asset too. We were able use the revenues from my web design and development consultancy to sustain us as we gradually transitioned all our team from that company to FreshBooks. That revenue generating company and an unwavering belief in ourselves have been our assets…those things, and what I would call reasonable expectations.
Here is a little feature that we’ve been working on that’s coming out in the next release of FreshBooks. It allows you to easily add a line to an invoice wherever you like… a slight improvement to the current functionality which only allows you to add a line to the bottom. This is all done in Javascript so it is quick and seamless without reloading the page.
I finally broke down and bought a BlackBerry. So far I have to say it’s been amazing. I bought a BlackBerry 8700, but the reason I was inspired to post is sort of unusual. I decided to post because I dropped my brand new BlackBerry 8700 three times in the first 24 hours I had it… two times on a hard tile floor, once on pavement… while I was running. All three times the device fell hard. It ought to have broken… seriously, but it’s barely got a scratch, which totally blows me away.
Having my expectations exceeded made me figure it was worthwhile to post. Truly an excellent product from a colossal success in Waterloo, Ontario.
When considering whether we should build the integration of FreshBooks with Basecamp, there were a few questions all of us here wanted answered before proceeding:
1. How would our small business customers use Basecamp and FreshBooks together?
2. Would any integration we build bring enough benefit to our users for it to be worthwhile?
3. Does anyone even really use Basecamp that often?
I think we were able to answer questions one and two with some effective design sessions, user interviews, and experimentation. We came up with what I think are two great options on using FreshBooks and Basecamp together. It clearly doesn’t cover all the possibilities, but judging from the feedback we have received and usage to date, I think we have covered off 80% of the use cases that provide the most benefit.
Number three was a toss up. 37signals is clearly a darling of the Web 2.0 world and one of its first real success stories, so there is no doubt they have a lot of people using Basecamp. We didn’t know for sure how many businesses were using Basecamp and certainly had no idea how many would use it with FreshBooks. But in true Web 2.0 style, we just built it anyway. As it turns out, there are a lot of businesses that use Basecamp.
As of today, over 6% of the businesses that actively use FreshBooks have enabled access to their Basecamp accounts. Considering this was released less than a month ago, I would consider that a very high percentage and an indicator of just how many businesses use Basecamp.
We don’t really have any other service that we can compare this to, since Basecamp was the first project management service we have integrated with. However, we do have a number of businesses using online payment gateways. The most popular is PayPal. 39% of the businesses who actively use FreshBooks have enabled a PayPal account. That is impressive, but I’m guessing Basecamp will catch up to PayPal as time goes on.
Try out this simple test to see how fast your reaction speed is.
A few months ago, I made a blog post about improving your productivity with hotkeys. This week, I’ll show you how to increase your productivity by increasing your mouse pointer speed. The logic is simple. If you move your mouse a shorter distance (at your usual speed) to complete a task, you save time. Now multiply that time savings by how often you use your mouse.
At first, you may notice that your mouse precision and accuracy will be lower than normal. However, much like a hot tub, you will get used to it fairly quickly and be ready to turn up the speed even higher.
Instructions on increasing your mouse speed: Windows XP / Mac / Vista
One good starting speed I suggest is to set up your initial speed so you can comfortably move your mouse from one corner of your screen to another without moving your arm. As a result, you can navigate your entire screen just by moving your wrist. This might be too fast for some users, so slow down your mouse speed if you need to.
Feel free to post your fastest time from the reaction speed test. My best time was 0.125 seconds after trying it out for a few minutes. Warning, the test is highly addictive and may actually reduce productivity.
For Nerds: For those of you who have found that you have set your mouse speed to the maximum limit, and still feel like you can handle more: You can bypass your Windows or Mac operating system settings so that you can speed up your mouse speed beyond its maximum.
Instructions: Windows / Mac
Occasionally you are lucky enough to have a realization come crashing through – you learn something that you will probably never forget. Here’s one that crashed through on me – in business, perspective is everything.
One day about 3.5 years ago Levi and I were sitting with a couple VCs and they were telling us about a recent investment they had made in an email hosting company. Levi and I both looked at each other and without words said, “Email hosting? Can you believe these guys?!” We thought it was a total joke.
The light bulb did not go off until we were speaking with Pat Mathews the CEO of Webmail.us (we use Webmail.us for email and it is excellent). Pat simply pointed out that thanks to spam and sheer volume, managing email is a real pain for most businesses, and he explained how many self respecting businesses just want to pay for mission critical services instead of using popular free services that are available.
Ironically Webmail.us’s story is similar to the story of FreshBooks. Most people think online invoicing is a boring and simple kind of service – they dismiss it much like Levi and I dismissed email hosting. But we just don’t see invoicing as boring. We think invoicing and other unaccounting services are fascinating and we have a long list of ideas that will help us to continue to reinvent and redefine what invoicing can be – like our soon to be released business benchmarking service.
So what is the point of all of this? If you see a product/process/service that everyone else perceives as old and tired and you can see ways to improve it, or maybe you are just unsatisfied with the state of the art, you’ve got a perspective that is an opportunity, and if you seize it, my money’s on you.
Coming soon to your FreshBooks account is a report that looks like that school report card that you used to dread arriving every semester. The difference is that instead of Cs in Algebra, this report card has valuable business benchmarks for your small business. My guess is, instead of dreading it, you will be counting down the days and hours until your report card is available. In it will be a quarterly summary of how your business is doing and how it measures up to other businesses that are doing the same type of work as you.
These report cards are available to all active users of FreshBooks. If you have not designated a profession for your business, you will not be able to measure yourself against other businesses, but you will still see your report.
We see these benchmarks as being very useful for small businesses that do not have access to market data, or expensive research reports. If you business is growing, it may interest you to find out the average revenue of other businesses to see if you are just hitting your stride, or nearing your peak potential.
The report cards also display how others are benefiting from FreshBooks to get paid faster and collect more money.
FreshBooks report cards will be available every three months starting this April. You have a few weeks to start performing before your parents find out your marks!
We have shown you an example of our website being cloned before, here is another that we just discovered:
http://www.greatvantage.com
I’ll take it as a compliment… I guess.
PC World wrote us up a few weeks back, and despite saying that FreshBooks “will handle your billings and collections with aplomb”, I have to say they totally missed the point.
First of all, what makes FreshBooks exciting? We’re serving a previously un-served need by allowing people to send invoices and collect payments without being bound by the tedious requirements of traditional accounting software – or by software that is not designed at all for invoicing (such as Word and Excel). Instead, what does PC World harp on? All the ways FreshBooks is not accounting software.
I took time to explain UnAccounting services and why the thousands of businesses we serve love them, but like I said, PC World just doesn’t get it. They think you *need* accounting software when chances are, if you are a service-based business who wants to take the pain out of collections, you don’t.
I thought PC World was about technology and what’s next, and they of all publications would appreciate how we are serving an unmet need for small businesses who need help with their receivables. I was wrong. Heck, PC World did not even include a hyperlink in the article. What year is this anyway? 1984? The web is about links – leaving links out of online articles is not exactly cutting edge, is it?
And I almost forgot, they have factual inaccuracies in the article. They rated FreshBooks a 74 out of 100. Apparently this qualifies for a “good” rating in their books. The trouble is, the two “cons” (i.e. negatives) they cited for using FreshBooks are that we do not include “accounting features” (um…exactly. That’s the point. Am I missing something here?) and that we don’t handle inventory – which we do! By the way, we asked the author to correct the inventory inaccuracy; it’s been over a week and so far no movement on that.
There’s a lesson in here for anyone being interviewed: sometimes they’re not going to write things the way you said them. This is nothing new.
We bought three new Dell machines and four monitors earlier this month and since then we have been receiving a steady stream of sales emails from Dell. Daniel unsubscribed from their mailing list this morning, which as he says “was easy, but…” after unsubscribing, Dell informed Daniel it can take ten business days to become fully unsubscribed. Here is the message:
As of 19/03/2007 8:59:28 AM, this e-mail address will be opted out from all marketing e-mail subscriptions within 10 business days. In the interim, you may continue to receive e-mail marketing to which you originally subscribed.
*Weak*
Now we are getting more emails from Dell like “Spring Blowout Sale”. Dell…we bought your stuff, now please let us go and stop wasting our time. If we love you, we’ll come back…that’s how it works – or at least how it ought to work. Right now this relationship is on rocky ground.
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