Fit for Sale

Sales

As an app developer, I am often approached by friends and acquaintances with “great” app ideas. They believe their idea is worth millions and that I should drop everything and develop their app. Businesses too fall prey to the idea that “I need an app“. Either way, it’s imperative that adequate market research be performed prior to developing any piece of software. 

A Great Idea

A few years ago, I was approached by an individual who had a “great idea” for a software application that was going to revolutionize the industry. He had some startup money to develop the application, and was in a hurry to get started. He contacted me to write him a mobile application, cloud-based management system, and REST services for integration points. It was an ambitious project for the client, and I was excited to start developing. He provided the requirements to me, and I wrote the software. I provided feedback to improve the application, but it was ultimately the customer’s decision what he wanted to include or not include.

Poor Market Research

Unfortunately, as the project moved forward, I learned that the client had very little money for development. None-the-less, we worked to create a working product which we achieved on his budget. But, as he would learn during the next month, he was creating an application that nobody actually wanted. Not only did his application lack features that would be necessary for adoption, it served only a very small niche market. The customer assumed he knew what people wanted, and had never bothered to reach out to any prospective clients for feedback.

Consequences

Due to the customer’s poor market research, he was unable to find clients interested in his software application. Months went by with very few interested parties, and nobody ultimately purchased the software service. Consequently, the customer blamed me for writing an application that nobody wanted. He even fought me on payment because he was unable to make his money back through sales.

Lessons Learned

There are several important lessons to be learned from this experience. First, if you’re paying someone to write you software or create any other work for you, make sure it’s worth the cost. It’s your job as the customer to know what you are purchasing and to ensure that it will meet your business objectives. As a software consulting firm, I can provide you with information and develop software. However, I can’t tell you wether or not your application will be a success. Second, market research is of paramount importance for any project. If you don’t know the target market, the demographics, the estimated number of consumers, and other key data; you can’t determine financial viability of the project. Before you go into any project, do your part first and ensure that the work you are paying for will take you where you’re trying to go!

Scheduling & Planning

Schedule

Last January, I made a decision that profoundly changed my life – I started scheduling and planning my time. Most people are subjected to schedules and plans at the workplace, but few take their life so seriously. As a consequence, we all end up in a place we never intended to be. We all have hopes and dreams, but we fail to plan the steps necessary to get there. During the last year, I started my business full time, completed 61 college credits in 6 months, read four books in Chinese, and accomplished more than I have in years. None of these things would have happened without planning and scheduling.

Pen & Paper

Many people may use electronic tools like Google Calendar or their iPad Reminders. While these are both great tools, they are way too easy to ignore. I have found that using a written planner is so much more effective. Every night, I plan out out the most important things I need to accomplish the following day. On Sunday, I plan the big items I need to accomplish throughout the week. I take notes of what happened in any given day so that I can reflect on my progress later and see where I can improve. I nearly always have my journal nearby so that I can capture anything important to me.

Electronic Tools

While I prefer to do my scheduling and task lists on paper, there are some things that simply work better via electronic scheduling. For instance, when I write a blog post, I schedule it to be published at a future date. That way, I can write several posts during one block of time and have them go out during the upcoming month. For my social media, I use HootSuite for the same purpose. I can schedule all my media for the week or the month and not worry about it during the week. This ensures that my blog and my social media are constantly fresh and updated without the necessary worry about posting every day.

The End Result

Through the use of scheduling tools, I have found that I am able to be substantially more productive than ever before. Tasks get accomplished on time, more gets done, and I have more free time to focus on the things I enjoy in life. Even more importantly, I know where my life is headed. I have a plan, and I know where I’m going. Do you?

Payment Terms

Money

Recently, a fellow small business owner asked me how I handle billing. For a small business, money is often one of the biggest concerns. Without a steady flow of cash, you can’t meet your business objectives or your personal financial requirements. As a small business, you have to determine when to bill and how to bill. Even worse, you have to define how you deal with delinquent payments – which can kill your business.

When To Start Billing?

The first question to answer is when do you start billing? This is particularly true if you’re billing by the hour. Does the clock start ticking at your first meeting? After the project requirements are defined? After the project is complete? For my business, anything after the initial project meeting is billed to the customer. I think it’s important for a customer to understand that project planning, requirements gathering, and any other tasks completed before any actual code is developed is an integral part of the development lifecycle. I typically bill the first of the month after any billable hours have accrued. I’ve found that the longer you wait, the more the bill increases. Then, you risk the customer suffering from sticker shock when you finally send the bill after months of work.

Late Payments?

When I started my business, I was so pleased to have customers that I didn’t worry about late payments. I assumed that my customers respected me enough to pay me on time. I was incredibly wrong. What I’ve found instead is that many companies will put me at the bottom of the list of payees. Why is that? Well, I think it’s pretty simple. The customer knows they have to pay their lease on time or risk eviction. They know when they fail to pay their internet bill, they won’t be able to perform their mission. What happens when they don’t pay you? Likely nothing. Additionally, they know you don’t have a collections branch and are unlikely to use a collections agent. Thus, they have absolutely no reason to worry about when they pay you. I have learned to include verbiage in my contracts defining payment terms. I give customers a 5 day grace period, and after that the customer is charged a late fee. Additionally, all the customer’s projects are paused until payment is received. If you continue to work, you end up months behind on payment and continuing to work for free.

What About Equity?

I’ve had many ‘customers’ offer to pay me in equity. I do the work and they will give me a percentage of the revenue generated by the software. I have a very simple answer for this kind of relationship. No. While an individual may think that their idea will generate millions, they rarely do. Even worse, you’ve now wasted time developing software that you will never be paid for. The original ‘customer’ lost nothing. You lost countless billable hours to a project that will never be profitable.

Conclusion

Money is the lifeblood of any business. What I’ve learned is that it’s imperative to have clearly defined payment terms and procedures for your business. When you fail to make those terms clear to customers, you will quickly find that your business struggles to get by and that you are spending more time nagging customers to pay than you do performing your business’s objectives.

Surface Pro 6

As a developer, I tend to need a lot of hard drive space for projects and tools. As such, my MacBook Pro was starting to run out of drive space. This was only exacerbated by the fact that I was also running Windows 10 on the same machine for .NET projects. I decided it was time to replace my MacBook Pro, and looked at the newest product line. Unfortunately, I was very disappointed by the lack of ports on the new MacBook Pro. With a sticker price of nearly $4,000 for a machine with all the bells and whistles, the lack of ports is simply unacceptable.

What to Do?

After much deliberation, I decided to get a separate Windows machine and reclaim the space on my MacBook Pro for MacOS. I had been looking at the Surface Pro for a while as it looks like a great machine. So I went to the store and purchased the computer, a keyboard, and the pen for around $1000. Given a price tag one fourth that of a new MacBook Pro, how does it compare? So far, I am very impressed. The Surface Pro includes numerous features that the MacBook Pro can’t touch including: facial recognition for login, touch screen, functionality as both a tablet and a laptop, and he use of an optional pen for drawing.

Conclusion

While the Surface Pro does not compete with a top-of-the-line MacBook Pro in terms of raw horsepower, it is lightweight, multipurpose, and more than adequate for the occasional .NET project I need to support. Even more exciting, it will work far better than my MacBook Pro for taking onsite to gather customer requirements or take quick notes.

Note to Apple

Apple, your decision to remove standard USB from your laptop cost you $4,000 I would have gladly paid. Instead, I paid $1,000 to buy a laptop from your competitor. While you may think you’re a trendsetter, a large number of developers I’ve spoken with are less excited by your choice. For us, computers are a tool to solve a problem – not a trendy accessory. You managed to capture a growing portion of developers, but focusing on trends instead of solutions will negatively impact that growth in the future.

Lessons Learned

A little over a year ago, I decided to start using a planner to keep track of my todo list, take notes, and keep track of progress on projects. Each week, I review what happened during the week and note any lessons learned during that week. At the end of the year, I compiled all the lessons into a PDF document that I can frequently review. This helps me to continuously improve myself both personally and professionally. Some of the things I’ve learned may be worth sharing.

Fall in Love with Customers

I’d like to say this one was mine, but I read it somewhere and it really resonated with me as an owner of a service company. Imagine if you treated every customer like you were as infatuated with them as you are with the man or woman of your dreams. Deliver that level of service! This is a hard one, but if you can do it you will never be without clients!

Be a Leader in Everything You Do

It’s easy to lay back and relax, and let someone else take charge. But your success will only be achieved when you make it happen! If you want to be successful, you need to be a leader in everything you do – in your home, your workplace, your place of worship, your social clubs, absolutely everywhere.

Focus on People

As a business owner, it’s easy to focus on money. We worry that we won’t have enough or that our sales pipeline is drying up. When we do that, we lose focus on people. But relationships are really what matters most. Every job I’ve ever had – whether as an employee or a contractor – started by having a relationship with someone.

Be Selective of How You Spend Time

Life is short, and you’re busy. Do you really have time to commit to a new project? Volunteer at the school? Take on additional responsibility? If the answer is no, don’t commit. It’s easy to become overcommitted – and burned out. If you don’t have the bandwidth or the desire to do something – don’t do it. Focus your time on the things that will aid in achieving your goals.

Set Goals

I have found that by setting goals – both annually, quarterly, and weekly, I am able to achieve substantially more than I could before. I heard it once said “plan the work and work the plan”.

Conclusion

While I have hundreds of other lessons learned, the above represent some of the most important. This year, I have been trying to do a better job at all of the above. I’ve got far to go, but I can see the fruit of my labor when I look at how far my business has come during the past year.

Small Business Struggles

Becoming a small business owner is an incredibly rewarding experience. You have complete control over your schedule as well as how much money you can make, you can take time off whenever you choose, and you get to make every decision for your business. However, small business ownership is not without its struggles. Here are some of the things I’ve found out.

Don’t Expect a High Credit Limit

As a technology company, I need to be able to buy hardware such as computers online. And, writing software means that the $500 computer at the local store isn’t going to cut it. I want a high-end laptop. A laptop that will last for several years, run fast, and meet all of my high-tech needs. Of course, along with that comes a high price tag. That’s not a problem with my personal credit card. Years of solid payment history has yielded a good credit score, and a high credit limit. My business credit card, on the other hand, barely has enough to buy the accessories I need for my computer.

Everyone Wants a Job

Now that I own my own business, it seems that everyone wants a job. Somehow, as a small business struggling to find enough work for myself, I am expected to hire other people too and find work for them. Own a tech business? Now you can expect every teenage boy in your social circles to ask to be an intern for you this summer.

Human Resource Problems

Just hired your friend? Have fun with that! There’s nothing quite as awkward as dealing with performance issues or other HR issues when the individual is someone you’ve known for a long time. Now, you get to walk the fine line between running a successful business and protecting a relationship.

Hate Spam? Expect More!

As a business owner, everyone wants to sell me something. Whether it’s email, social media, or written correspondence, expect to receive even more junk mail. My favorite is when people connect on LinkedIn to grow their social network. Then, within minutes of accepting, you receive both a private message and an email to buy their services. Ignore that message? No problem – you’ll get another one tomorrow. Then, a week later, you’ll get a third message asking if you saw the first two.

Time is Valuable

As a business owner, you quickly learn how much it costs to perform tasks that are not billable. Marketing, social media, accounting, human resource management, website updates, and so many other tasks will require your attention – and none of them generate revenue. I’ve quickly learned to cut out the unessential so I can focus on what pays the bills.

Lots of Hats

I’ve learned just how many hats a small business owner must wear. Plan to be successful? You’ll need to know marketing, social media, accounting, human resource management, contract law, negotiations, and so much more. Oh, and that doesn’t even mention being an expert in the service you sell. Get a large hat rack – you’ll need it!

Final Thoughts

The last year of running my own business has been amazing. I’ve had financial freedom like never before and enjoyed the freedom to do what I want when I want. But that freedom hasn’t been without struggles. Business ownership is lots of work, and navigating the struggles has been part of the fun.

Social Media Etiquette

Social Media

Today, social media is increasingly being used as a tool for marketing and advertising. However, if done poorly, you run the risk of tarnishing your brand and being viewed as a spammer. Here are a few simple etiquette rules for social media.

Avoid Follow/Unfollow

Today, I was notified that I had a new follower on Instagram. After seeing that it was a local business, I decided to follow back. Trying to develop relationships with local businesses is an important aspect of my social media efforts. It wasn’t until a few hours later that I had an opportunity to visit their Instagram page. But when I did, I noticed that they had already unfollowed me. They had no actual interest in my content or in developing a relationship – they simply wanted to show me their products. This isn’t much different from spamming and does not present a positive view of your organization.

Create Content Not Advertisements

People are unlikely to follow you on social media to see what you have on sale this week. People want to see your personality, what your business stands for, and who you are. Of course, all businesses will occasionally create content that advertises their goods and services, but if that’s all you do, expect to be unfollowed. Social media is for growing communities – not a new tool to spam me with ads.

Stop Nagging Me About Services

On LinkedIn, in particular, this is common. Someone friends you and – wanting to grow your own circle of connections – you accept. Then, you get a private message about the services they offer. Viewing it for what it is – spam – you ignore the message. A week later, another message. Then a month later, a message asking if you got the previous message. Yes, I got them all. I chose to ignore them because I wasn’t interested in your product at this time. Additionally, I now am distrustful of you as I see you too are a spammer.

Like/Know/Trust

Want to develop your social media the right way? Use the like/know/trust model. First, users like you. They see your posts, enjoy your photos, laugh at your jokes. After a while, users feel that they know you. The’ve seen your stuff, they know what you stand for, and they feel that they understand you and your company. Finally, users trust you. They have seen you in action and know you’re knot a spammer. They recognize that you provide valuable content they want. They know you’re someone they could reach out to if they need your services. That’s the formula for success. You develop community and relationships, and people see you as a valuable asset instead of a spammer.

Do Unto Others

The golden rule applies to social media just as it does anywhere else. When you’re engaging in social media efforts, ask yourself how you would view another business if they used the same tactics. If it’s not favorable, don’t do it.

Return on Investment

During the past year, it has become increasingly obvious to me that many people don’t understand Return on Investment (ROI). Looking back, I realize this was not something I learned about until a businessman explained it to me. At its simplest, return on investment is exactly what it sounds like – the amount of return that an organization receives on their investment. However, this will be viewed differently based on the type of organization an individual works for – government, non-profit, or for profit entity.

Government Organizations

Government is the simplest to define as they have no ROI nor are they interested in ROI. This is not intended to be cynical, it’s just true. Regardless of your political affiliation, you can point to government programs that are riddled with waste. Why? Because government entities are not required to prove their programs work. We, the taxpayers, are forced to pay taxes regardless of the success of the programs we are asked to support. Deep inside, this is how we all want to work – we don’t really want management to access the value we bring to an organization, we simply want to be paid more.

Non-Profit Organizations

Non-profit organizations are a little more focused on ROI. However, their definition is far less stringent than a for-profit organization. For the non-profit, ROI is simply the appearance of value. Since non-profit organizations receive donations from individuals and entities, they only need to convince donors that their programs work. Even if they don’t, many will still give money to support the cause even when there is no ROI. Just like broken government programs, we can all point to non-profit organizations that continue to operate even though they are having no positive impact on the mission they support.

For Profit Organizations

Finally, we have for-profit organizations. In these organizations, everything is measured based on cost and benefits. ROI is simply the value something generates beyond the cost. This is absolutely critical for corporations. If money is continually invested in ways that generate less revenue than they cost, the business will quickly go bankrupt. If you want something, present your request based on the return on investment. Feelings and preferences have no place here. Can you directly tie your request to a financial reward? If not, don’t bother asking!

Why should you care?

The type of organization you work for will determine the ROI model used. Understanding that model will help you know how to argue for a raise, get a new computer, purchase additional tools, etc. If you work for a for-profit organization, decisions will be guided by how much money the business will get back from what they spent. If you can argue that your suggestion will yield more than it costs, you will be far more likely to see your request granted. However, if you argue based on your preference or feelings, you will likely find that your request is denied. Likewise, arguing that you bring substantially more to the organization than you are paid is the single best way to argue for a raise.

The Value of Communication

Phone

Throughout all my time in the workplace, I’ve heard employees at various levels complain about management. Workers always want to blame management for all the problems that end up derailing a project. Or, as a business owner, I hear other business owners complain about how poorly their projects are going with their clients. This is the status quo. Blame management and stay in your safe space without working to fix the problem. Or, maybe you’re on the other side of the equation… maybe you’re a manager or a business owner complaining about how the resources working on your project aren’t accomplishing the goals you had established for the project.

I don’t think the problem is management, or workers, or other businesses. I think the problem is much simpler… poor communication. I know this is true in my business. Some clients are eager to communicate with me. We have weekly meetings, discuss progress, determine if direction should be changed to better meet organization objectives, and spend a little time developing our professional relationships. Other clients simply can’t be bothered. Their schedules are too busy for even a weekly phone call. Which projects do you think go smoother?

Maybe you disagree. Maybe you think that resources should focus on accomplishing the mission assigned to them. Maybe you don’t want to spend time communicating with them. What impact does that have? When dealing with software projects, lack of communication can be catastrophic. You may tell explain a new feature to me, but I may misinterpret your request. Or, maybe your request wasn’t actually what you needed but I delivered exactly what you asked for. In either instance, both time and money has been wasted to move in the wrong direction.

Fortunately, the solution really is simple. Schedule time to communicate with the people on your team – both internal and external, senior and subordinate. Ensure that everyone understands the objectives of the project and provide frequent feedback as the project moves forward. Listen to questions and concerns and work with them to find a solution that best resolves any issues. If you want to achieve the most from any project, this is a necessity. If not, you’ll still be complaining about the same things next year.

Control and Responsibility

Over the past decade, the deep rooted traditional business methods have taken a shift, arguably for the better. In the Information Age where almost anyone can find out what they want to know, it’s much harder for businesses to feign values. People quickly become aware of any inconsistencies between what the businesses say they stand for and what they truly are. The same applies to company culture.

To note one thing in particular, the difference between a business that stands out as genuine versus the alternative comes down to looking at how control and responsibility are at play. A business feigning values will often have a structure of controlling more than they should, while shirking responsibility for mistakes onto those who fall lower on the totem pole. Rather than accepting a lack of sufficient leadership, they often play the blame game in an arrogant attempt to avoid displaying vulnerability or weakness.

Fortunately, in looking at the structure of Talixa, I see quite the contrary. Our business is exceptional at delivering quality through the services we offer, yet I see selflessness from our leadership and the other team members. Rather than trying to micromanage and control every part of the business, we each have lanes suited to our skills and experience as well as having a plethora of opportunities to excel. Since responsibility is shared across the board, team members are not afraid to admit to their flaws and work together to develop and grow. By filling in our gaps and working for the good of the team and the community, we are better equipped to scale as a company.

Hardly anybody likes when people pat themselves on the back, though. As far as I personally am concerned, I can’t take credit for the company culture and the success we have seen. I can, however, speak on behalf of the wonderful people that are also a part of this team and working to bring new industry and growth to our community. The more I get to know them individually, the more I am blown away by their willingness to serve. Where does your business or employer land on this spectrum of control and responsibility? If your business is community driven at its core, we’d love (insert shameless “Happy Valentine’s Day” plug) to develop a relationship with you.