Your Own Mouse Pad for $2,999

Last week Phenom Software deposited our first customer check into our bank.  It was a modest amount and not quite enough to send our kids to college, but Elmer and I were happy as clams.  It is only our 3rd month of operation, and we are blessed to have lined up a few paying customers for our consulting services, and ramped up our product development team as well.  For many start ups, that first revenue stream, however modest, is a big milestone.  It means you have real world customers willing to pay for your product or service, and that’s a big event.

The next morning I received a small package in the mail.  Elmer had decided to order us a small batch of mouse pads with the Phenom logo on it.  He designed the mouse pad himself and used Zazzle for production.  Later that day, as I tallied up all of our expenses in starting up Phenom, the total tab, including the mouse pad, came out to less than $3,000.  This included our hosted Exchange + SharePoint + Livemeeting, web site logo design and template, a couple of HP laptops, Quickbooks, server hosting, and our incorporation expenses.   In other words, what stood between our first customer payment and our own mouse pad, was $3K and 3 months of rolling up our sleeves.  Yes, the revenue currently comes from sale of consulting services.  In addition to providing funding for product development, we get to work with customers who will be potential buyers for our software.

As software engineers, we are blessed that the barrier to starting up our own business is so low.   IT infrastructure costs have gone down so much that it really only takes minimal capital investment to get going.  The real cost is time and sweat equity, but it turns out that if you are willing to stay real, and convince a couple of equally smart friends to take the plunge, things will probably work out fine.  Just be warned that once you make the leap, going back to a corporate job is probably not going to be an option.  Small business starters are really nice people, you’ll find it hard to go back to all the cynicism and toxicity that permeates the corporate world.

Oh, it feels great to have our own mouse pad.

The Ideal Work Space

One of the many challenges that you encounter when you start out as an entrepreneur, especially in the very early incubation stage, is the complete freedom and control over your own time.  I never thought that 100% freedom is actually a barrier to getting things done, but when I woke up last Monday and sat in my bed, it was a completely foreign experience to not have client or internal meetings / tasks / emails to attend to.  Of course, there is drafting product spec, competitive research, incorporating, getting contracting done for our first customer, and a thousand little things to do in the process of getting a company launched.  But the complete freedom to do things at your own pace is pretty unsettling.  Logically, making a to-do list and then prioritizing

the list was the right thing to do.  Alas, making lists is the easy part, sticking to it and executing is another story.  For me, the hardest part is entering the mental state of flow on the set of tasks that are intrinsically boring to me, it’s hard to spend an hour poring over contract details, but these are exactly the type of tasks you need to get done.

For the last week or so I’ve finally figured out a routine that seems to maximize the state of flow.  For me, the most productive hours are between 10am-12:30noon, and I find it difficult to focus in my home office.  15 years of working in noisy, non-ideal work spaces such as airports and client cubicles have actually trained my brain to focus in public spaces, so complete silence of the home office actually impedes flow entry.  So in the morning, I head to the local library.  The public library in my neighborood is well lit, provides wi-fi connectivity, and is relatively quiet in the morning.  There is plenty of hiding spots for some heads down work, and the magazine rack provides a welcome distraction if I want to take a break.

I suspect the ideal work space for maximum productivity is different for everybody.  But I’ve decided that when the time comes to secure a full time work space for Phenom Software, I’ll ask my architect to check out the local library, and ask him to read Joel Spolsky’s Bionic Office.

The case against Software Factory

BMW Welt Center

Recently I had an interesting discussion with the CTO of my previous employer about software factories.  The topic of discussion is how to plan out a software factory for the customer to lower delivery cost, improve timeline predictability, all that good stuff that you want to put in a thinly disguised recommendation to outsource your IT.  Alas, we are going to stay away from the sensitive discussion about the loss of American jobs or true efficiencies gained through outsourcing, but the whole terminology of “Factory” invoke the mental image of our decimated manufacturing sector and shoe factory workers in the province of Guan-Dong.

The discussion brought out a few interesting observations, the first being that the term software factory means different things to different people, and second is that we should probably stop trying to emulate the manufacturing sector and find new, more innovative ways to describe our processes and techniques.

First on the terminology confusion.  To a consulting firm or an enterprise IT organization, a software factory is an organizational structure, methodology, and processes that specialize in producing computer software applications or components according to specific, externally-defined end-user requirements through an assembly process.  To software vendors such as Microsoft, the term Software Factory refers to highly structured software architecture patterns, tools, and technologies that automate the majority of the software infrastructure plumbing.  Examples of such efforts include the EFX Software Factory, and Visual Studio based Smart Client Software Factory and Web Client Software Factory.  Both interpretations are correct, and the theory is that if you are disciplined and serious about creating such an organization, you probably want to start with a figuring out what practices your most successful team uses, codify and evangelize them, and implement a continuous improvement system to gradually automate the entire system.  In other words, the whole point is to take what Toyota and six sigma have done with manufacturing, and implement it in the software world.

One problem though.  This type of system is really, really expensive and time consuming to construct.  And the benefits take years to realize.  For most organizations whose business is not software, building a software factory doesn’t make sense, because they only need 1 custom piece of software, and spend most of their IT dollars integrating that software into the enterprise and then operating it.  For them, by the time a well-oiled, highly automated factory is constructed, there is no more business need for that type of products.  Software factories only make sense for businesses whose revenue model is primarily driven by technology.  People who work in that type of businesses don’t like to think themselves as working in a factory, the proper term there is a Software Design Center.

The problem, you see, is that for 99% of the global enterprises, their particular demand for software is are how to localize, integrate, and operate that piece of software.  What we need, really, is what KFC, Yum Brands, McDonalds have done to operate their local businesses.  For most enterprise customers, they need to create a Software Franchise.

So this long winded post is really about the power of words.  If we want to motivate our teams of engineers to build remarkable software, then we need to stop using terms that depict them as lowly skilled, task repeating assembly workers.  We as an industry need to use terms that reflect the level of expertise and craftsmanship required to create and customize software.  No more software factories!

Starting Up

Starting a new software business seems easy enough for an experienced consultant.  Find a great partner, check.  Talk to customers about problems bugging them, check.  Come up with some ideas that solve those problems, check.  Now on to developing some software, re-read Purple Cow and Who Moved My Cheese, and quit the day job, check.  Oh, and you start a blog hoping that eventually people will read it and you can casually slip in some marketing messages.

Then you find out that every good idea has been tried, and that tens of thousands of startups around the world have built countless innovations and pretty much all you have to do is find the right words to google to find the product that you want.

Now What?  For someone who is used to waxing on and on about Technology Trends, Innovation, Methodologies, and turning Concept into Reality, when it comes to building my own product, there is suddenly a case of analysis paralysis.

Thankfully, going back to an old job is just not an option, not until the self-imposed time period (2 years in my case) runs out and the electricity gets turned off.  So in the meantime, my partner and I will need to figure out how to take one particular customer’s problems and come up with a solution that will solve similar problems for lots of people.  We will start with the technologies and solutions that we know best, and hopefully build the kind of company that we would want to work at, the kind of place that attracts remarkable people to build remarkable products, and even if we don’t make it, we’ll have a great time doing it.