Lessons from the masters – getting it right

Written by Dave Collins, SoftwarePromotions Ltd.

I’ve been working with software on the web since 1997, and have had the pleasure of experiencing the different ideas, strategies and personalities of more than three hundred software companies. During this time, I’ve witnessed an astonishing mix of products, features and marketing methods – some of which have worked better than others.

One of the questions that I am frequently asked involves the elusive Perfect Product. Developers want to know what their next software should be, what the market is looking for, what sells, and how they can get rich as fast as possible. The truth is, I have no idea. I can certainly spot a terrible product that’s never going to make any money, but identifying the next big seller is a very different thing. As much as some may argue otherwise, there are no accurate, quantifiable characteristics of great software – and even if there were, there are a vast number of other factors that play an equally important role in the equation. Over time, I have come to realise that much of what makes a successful product comes from the people who develop and sell it. Rather than focusing on the traits of good software, it can often be far more beneficial to take a good, hard look at the characteristics of good software authors.

This article isn’t a “To-do-list for the successful software company“. If that sort of thing worked, you wouldn’t be reading it for free right now – I’d be selling it and making a fortune! This is merely a collation of some of the more interesting patterns and trends that I have been able to observe over the years. All of the characters referred to are based on real software authors, but I’ve altered their names and mixed up their circumstances to the extent where they won’t even be able to recognize themselves. Nevertheless, this is a great opportunity to learn from some of the masters of the software game – whether it be from their mistakes or their successes.

Reaching for the skies through your wallet – willingness to spend. 
Most of us are working for the same reason – we want to make more money. Most of us have also heard the adage about how you have to spend it to make it, but this is a truth that is frequently ignored. Over the years, I’ve witnessed a large number of companies slam on the brakes at the very first mention of parting with their hard-earned cash.

Advertising and promotional activities should be a critical ingredient of any company’s marketing mix. By only ever considering free opportunities, you’re limiting both your growth and visibility. Darren Hansen is someone who has truly grasped the essence of this truth. Darren has a small company in the US, and at last count he was selling eight quite distinct products. He believes that spending is a vital component of doing business, and is always open to suggestions. If it saves him time, makes his company look good, eases his workload or has any chance of increasing his sales, then he’s all ears. He may not always say yes, but he’ll always listen with an open mind.

The measured risk road to achieving dreams
Risk taking isn’t limited to your budget. As frightening as it may be, there is a whole world of risks and possibilities out there, and you need to be willing to consider them. New technologies, new markets, new advertising venues – all of these could potentially provide you with fantastic opportunities if you’re willing leap into the unknown every now and then. Caution is a good and healthy instinct, but being terrified and always sitting back to see what happens next could be your downfall.

If a company isn’t prepared to take risks, they are effectively confining themselves to a very limited number of opportunities from the outset. If you let your competitors take all the risks while you look on from the safety of your desk, you could be handing over your future sales. If you consistently limit your company to only ever going after guaranteed results, you’re never going to get anywhere, and you know it. No risks equals no hope of ever achieving your dreams.

Personality and perseverance vs. pointless procrastination
We all know that the driving personality behind a successful company is vital – that much is obvious. There is much that could be said about this particular fact, but I’d like to keep it short and sweet. I’m a firm believer in one particular idea: there are leaders that talk, and leaders that do. There’s nothing revolutionary about this, but it’s true. And invariably, the doers are more successful than the talkers.

Nathan Peters is a doer. He runs a well-known company with a very substantial range of products, and is a classically democratic leader. He believes in a very open relationship with his employees, and is forever interested in hearing what anyone has to say about his software. But one of his skills is that he knows when it’s time to stop talking, and is capable of ensuring that ideas quickly are turned into action.

Jefferson Gough is a talker. He has great ideas, and will talk to anyone and everyone, at length, about the exciting plans he has for his software. “Should be ready real soon”, he declares. “A couple of months, at the most”. He spends hours talking to his partner, explaining what his visions are and what he thinks they’re capable of. But no action is ever taken – and a year later, Jefferson is still in the same exact place, talking about his brilliant plans.

Most people are a mix of Nathan and Jefferson – if you truly want to be successful, try to make sure you do more and talk less.

Bending the right way; flexibility and accommodation
Whether you’re working alone or as part of a team, it’s very easy to become set in your ways and blind to other ways of doing things. Of course, a successful software company has every right to admire their own creations. Nevertheless, they also need to acknowledge that their way is not always the only way, or even necessarily the right way.

With the right attitude, a company should be able to mould their ideas around the needs and wants of their customers – not the other way around. Being able to take criticism isn’t enough. You need to be hungry for it, and you need to be able to pick out golden nuggets even from the most mundane or unlikely of sources. Remember, you’re not going to buy your own software, other people are. Adapt to their demands, and try to leave your personal likes and dislikes behind you.

Don’t go around complaining about bad or nightmare customers, either. It’s a waste of time, and unhappy customers are an unfortunate fact of life when you’re doing business. Bad businesses fail to respond to what they have to say, and don’t stop to consider that there might be a lesson in it for them. Remember how “the customer is always right”? That applies to your customers, too.

Giving it away to sell
Don’t be a stingy software author. The value of your software is in direct proportion to the number of people that know about it, and you need to realise that some people’s attention is more valuable than others’. If you’re lucky enough to have caught the attention of a newsletter or magazine editor, don’t even think about offering them a trial version of your software. Give them the full version, and tell them that you’ll give one to all their colleagues, too. If someone is in the position of having an audience, and they really like your software, you need to do everything you can to help generate their enthusiasm. What you don’t want to do is remind them that they need to buy the full version after thirty days.

In the same vein, don’t be too scared to make an old or basic version of your software free. It can be a brilliant way to reach new customers, even if they’re not in a position to pay for your product at the moment. The person who is looking for a basic, free solution today might well be the owner of next year’s successful company. Make sure that when their time comes and their budget increases, your product is the one that they’re already familiar with.

Honesty and recognition of limitations
You may be able to write great software, but nobody’s good at everything. If you can’t create good graphics, then don’t even think about redoing your own website. If you can’t write, don’t bother trying to produce the copy for flyers, press releases and websites. Recognize your own limitations and weaknesses.

Tim Korea runs a small software company in the US. Their products all offer well thought-out and innovative solutions for everyday problems, and most of them are based on ideas that originated from Tim himself.

“I’m an ideas man”, Tim is fond of saying. “I scribble them down, piece together an ugly, working demo, and then I pass it on to my team. We have three code writers, one graphics person, and we use an outside company to write our copy.”

Tim’s ideas are unique, innovative, and cater to people’s needs. But his biggest strength is that he knows what he’s good at, and what he should hand over to others.

Vision without “vision”
Let’s be straight here – I’m not a big fan of self-help books. One thing they all seem to have in common is that they love to talk about vision – a business without a vision is like a ship without a captain, and so on and so forth. Vision is portrayed as a critical factor for success.

I myself have a very different vision of, um, vision. For the successful software company, vision isn’t a broad, all-encompassing platitude. It’s about the ability to spot opportunities, and to recognize a winner when it rears it’s head.

Gary Weinberger runs a small software company in the UK. Together with his wife, he sells a small range of business-based products that help organise one of the more important assets – money. While there is no shortage of accountancy applications out there, Gary saw an opportunity that none of them had addressed, and realised the potential immediately.

Spotting the opportunities is relatively easy. Implementing them, and turning them into good software solutions that people want and need is quite a different story. A successful software developer will recognise what people are looking for, understand how people work, and then tie the two together into a good, solid benefit-based solution that people can use and buy.

Running a business, not a business plan
All this talk about vision leads me smoothly onto one of my pet hates: business plans. As a moderately cynical Englishman, I find that business plans too often are associated with awful, cutesy mantras like “failure to plan is planning to fail” and all those other self-empowering pieces of nonsense.

Undoubtedly, many business plans are based on common sense. The problem is that they are often taken absurdly far, and seem to take on a life and purpose of their own. Worrying about the business plan takes up more time than worrying about the business – it is obvious that this can’t lead to anything good.

Without a doubt, it is important for a successful software company to know where they’re going, and where they want to be in X years time. But it’s equally important to know what’s realistic, and what amounts to little more than a hopeless dream. Yet again, you need to strike the correct balance between optimism and sheer madness. And any company who wants to be successful has to be prepared for a long and fairly slow process, with a wide range of different hurdles along the way.

Tim Korea used to work for a .COM start-up, and spent far too many nights sleeping under his desk. After two years, he realised that he could be doing this on his own, and doing a better job in the process. So he quit his job, and started off his company as a one-man show in his basement. He produced a business plan, and outlined a three-year plan for his company, where he envisaged a team of five in a small but comfortable office. Today, his plan has come true.

Tim’s business plan succeeded because it was built on a number of unique strengths. The first was that he was utterly realistic. He budgeted to make a loss for the first twelve months, he planned on spending money on outside talent from the outset, and he never allowed his imagination to pull him too far away from reality. Nevertheless, his main strength was that it took him one single day to research, plan and write his business plan. Day two saw him turning his basement into his office, and day three saw him start working on his software.

In five years time, you may well have the world’s best business plan for the world’s worst product. Don’t allow yourself the self-defeating luxury of procrastination via a business plan. It’ll get you nowhere.

Style, taste and selling the skin-deep
Often overlooked and impossible to imitate, style is one of those attributes that you either have or you don’t. Imitations just don’t cut it. While this may mean that you or I are forever doomed, there is still hope for our companies. Even if our own sense our style leaves much to be desired, there are plenty of companies out there who can assist us.

Take advantage of the professional services that are available, and ensure that your software looks every bit as slick and professional as you know it is. Think about it – there is nothing that isn’t judged by appearance. It would probably be possible to fit some of the power, smoothness and sophistication of a BMW engine into any old rusty body- but would people look at it and want to buy it? I think not.

Whether you’re polishing an interface or working on your website, you need to understand that the packaging is a critical factor. If you keep telling yourself that people will be able to look past your clunky graphics and appreciate the advanced features within, then you’re wrong. Very wrong. A brilliant application that looks like something out of the Windows 3.x era is never going to make it.

Courage, bravery and slingshots
As I mentioned earlier, being overly cautious can be a dangerous thing for a businessman. Jumping headfirst into anything can also be a seriously bad idea, but sometimes things that initially appear to be ill-thought through can prove to be a very clever move indeed.

Nathan Peter’s company competes with one of the biggest and most widely known software producers in the world. Many might dismiss his venture as hopeless and doomed to fail, but Nathan would have to disagree. He believes that no matter how dominated a market may be by one single company, there is always room for someone else. And his company is living proof that you don’t need to be the biggest to do very well for yourself.

There is no point in reinventing the wheel, least of all in a market where there already are thousands of minor variations. However, if you can offer something significant that gives you a unique advantage, you should be milking it to the full. If you’re a David offering something that Goliath can’t provide, it’s time to whip out your slingshot and face him head on. Just make sure that people actually want what you’re offering. Well-placed courage has a high chance of success – foolhardiness doesn’t.

Managing without the micro – the art of delegation
Many of us need to wake up and face the truth – we can’t do everything, and we can’t control all the people all of the time. The inability to delegate is by far the most common weakness in small businesses, and it can actually be quite a serious threat. If you cannot learn how to pass on tasks to other people, then you will forever be limited by the number of available hours in each day. Believe me, there are never enough.

Even if you have, slowly and grudgingly, learned to delegate, you need to make sure that you don’t start sneaking back in under the guise of keeping an eye on things. If you’re a self-confessed micro-manager, you need to realise that you’re paying someone not do the work they’re supposed to do. It’s a no-win situation for you both.

Having said this, you also need to ensure that you don’t take it too far and lose touch with what is going on. Tim Korea remembers when he trusted someone too much. “This was a great guy”, he recalls, “with a lot of really good ideas. At the time, it seemed like a good idea to keep adding to his workload. Unfortunately we overdid it, and by the time we realised that he simply couldn’t cope, everything was in a really bad way.”

If you’re lucky enough to be in a position where you can have total faith in a partner or employee, keep the lines of communication open and monitor from a distance. But don’t get too involved – let them get on with their work while you get on with yours.

Time control – the importance of deadlines
Running your own business shouldn’t mean that you have an unlimited amount of time to do whatever you want. Irrespective of the size of a company or the scale of a project, a timescale needs to be imposed and adhered to from the start. Otherwise, plans will never be realised and goals will never be achieved.

Darren Hansen favours the open approach. As soon as he starts bouncing around ideas, he delegates different responsibilities to everyone involved. And with Darren, there’s always a deadline. You’ll never see a member if his team getting an email with a vague request asking them to look into the practicalities of switching over their database. Instead, they’ll be asked to prepare a one-page summary of the issues involved, and to have this ready by Friday morning.

From Darren’s point of view, it’s not about cracking the whip. He believes that without a deadline, most people will take longer than they should over pretty much anything and everything. By offering full support but insisting on strict deadlines, Darren believes that efficiency becomes second nature to everyone involved – himself included. As far as he’s concerned, deadlines mean more regular new features, new versions and new software. All of which translate directly into more sales.

Expansion through multi-basketing
Expansion shouldn’t only be about employing more people in bigger offices. It shouldn’t just be about going from download to shrink-wrapped, or going from a $29 advertising budget to the dizzying heights of advertising in print. It’s about expanding from the outside, and growing from within.

Heinz Kleinwald runs a one-man show from Germany. But while everything rests on his shoulders, he’s very eager to outsource – in fact, he’s got it down to a fine art. Heinz uses outside companies to design his website, create his logos, write his copy, prepare and distribute his press releases, keep on top of his marketing, handle his CPC campaigns, take care of his accounting and even take his phone calls.

Even though he’s on his own, Heinz now sells four very different applications. Each targeting a different market, and each with their own website. Amazingly, Heinz even has the time to release reasonably regular updates, although he admits that he’s nearing his limit for what he can deal with. Not that this has stopped him working on product number five, scheduled for release by the end of the year.

Darren Hansen’s company came into existence with two products. Both reasonably similar, with identical markets. When Darren realised that he was onto a good thing, he invested time and money into building them up. As the products’ name and popularity grew, so did their sales. Yet even as new monthly sales records were being broken, Darren did not pause to rest on his laurels even for a day. He was already working on two new products, targeting completely different markets. It’s fair to say that he’s never looked back.

Darren is a firm believer in not carrying all your eggs in one basket. Effectively, he’s now carrying eight different eggs in six very different baskets. Even if there’s an omelette or two around the corner, Darren’s future looks good.

An ear to the ground; looking beyond the bubble
Nobody could ever dispute that business information and intelligence is critical, no matter what your product is, and software authors are no exception. If there’s a new Windows operating system around the corner, you need to know how it’s going to affect you long before it’s released. And if there are new development technologies such as .NET, you need to be in the know.

It should also be obvious that you need to know what your competition is up to. Industrial espionage is not a good idea, but there are many legitimate ways of monitoring people with products that are similar to yours. Failure to do so might cost you more than you realise. There are tools, services, newsletters and periodicals that can make this task quicker and more reliable. Take advantage of them, and use them to the full.

If you act as though your business exists in a bubble, sooner or later you will be burst from the outside. And you won’t even have seen it coming.

Perspective – tying it all together
This article isn’t intended to be a checklist for the ideal personality. Some may argue that great leaders and business people are born, not made. Personally, I don’t believe that we can alter or mould all aspects of our personality, and I don’t believe that you can achieve success through a series of tricks, mindsets or self-programming.

But I do believe in one of the oldest tricks in the book – imitating those who get it right. If we manage to learn from their more positive traits, we can only gain and prosper. So throw away your self-help books, stop spending so much time trying to believe in yourself, and start doing good business. Be seen, be sold.

Written by Dave Collins, SoftwarePromotions Ltd.