rwalling

I hired someone last week...but thanks for checking it out.

Thanks for two mentions on this esteemed list :-)

Oops...apologies to Myles if I mis-read this - I thought he was mocking the PIH, taking the side of the startup guy.

Oh man...he had me until he called thousands of people, many of whom I know personally, "probably either unethical or lazy."

I think we can all agree that there are multiple ways to approach startups.

The misstep Myles makes is to assume that one approach is somehow superior to another, and then take the further step of insulting everyone who is striving for something different than what he sees as the best option.

We all have opinions on this topic, and it's an interesting discussion to have. But let's try to avoid dogma and judgment.

What's right for your unique situation isn't necessarily right for the 100,000 other people with similar ambitions, but who may be in vastly different life situations or just have different goals than you do.

Oh, and call me when you're 40, married with 2 kids and a mortgage, and you're coding Perl for a bank because none of your startups made you the millions that TechCrunch promised.

I think he meant the author of www.startupbook.net...that's me. I also posted a comment elsewhere on this thread with more thoughts.

Rock and roll. I've seen that movie 20+ times.

I was planning to let the book stand on its own. But the more time passes, the more requests I see for an updated edition. The book is approaching 11,000 copies sold to date, so it's obviously filled a need.

I'm booked through May with MicroConf and the launch of GetDrip.com...but I've added "Consider v2.0 of Start Small, Stay Small" to my task list. To be considered for the latter half of 2013!

>>So, if you're new to development, it's probably best to build small products (wp plugins, niche sites etc.) to build your portfolio, earn a little cash and more importantly increase your knowledge and experience.

Yes, this is the tact I would take. I talked about this exact topic in-depth on a recent episode of Foolish Adventure: http://foolishadventure.com/audio/how-to-market-your-softwar...

Early successes are huge not only for you learning the ropes of outsourcing/marketing and giving yourself a small financial cushion, but also for building your confidence that you can make this happen.

>>Rob, is it possible that some people just get lucky with a great outsourced developer?

Good point. This is definitely possible. In my list of the 3 factors above I should have added a 4th: You find an awesome developer, whether through luck, having a great network, or knowing how to hire.

But it's just another variable that impacts that continuum I mentioned and pushes you more towards that 90% or 10% end.

>>For example, you've said on various podcasts that you're an advocate of VAs but have you had more than 1 or 2? Presumably, as soon as one works, you stick with him/her - perhaps that's luck rather than learning?

My success rate at hiring and managing VAs, developers, designers, writers, etc... is waaay better than it was when I started (at least 2x better, maybe 3x). I attribute this to getting better at both hiring (i.e., choosing the right fit) and managing/delegating (i.e. having more skill with outsourcing).

Ruben nailed it with this list. In my experience outsourcing is a continuum; it's not a never/always situation. Meaning you can increase your chance of success by having the factors Ruben mentioned above in place. I would also add that these factors make it easier to outsource your app:

1. Having dev skills

2. Building a mobile app or WP plugin (i.e., something simple) vs. a SaaS app (i.e. tons of moving parts and more ongoing maintenance)

3. Experience outsourcing in the past. It is absolutely a learned skill and the more you do it the better you get.

If you have none of the things Ruben and I have listed (so you're not a dev, you're building a SaaS or other complex app, it's your first time outsourcing, etc...) you have a very, very low chance of succeeding. And if you have every single one you're on the opposite end - IMO the swing could literally be from 10% chance to 90% chance of success depending on the factors you have in place.

>>I don't agree with Rob on one thing - that downloadable desktop software is going away

You're right, "going away" is a strong way to put it, but in the context of "I want to build an app that has a viable market," unless you really know what you are doing, stick to web or mobile.

Desktop apps are, with a few exceptions that you listed, "going away" as a viable market for bootstrapped entrepreneurs. When in doubt, go web or mobile.

Re: internet connectivity: At this point I am never without an internet connection when I want one, and looking ahead just a few years, the world will be blanketed with it much like you can now access AC power in the vast majority of places you can go. So thinking ahead just a couple years you can imagine how this will continue the trend of apps moving away from the desktop.

Yes - we will have a pre-signup for this year's attendees.

There is risk, but that's why you lessen it by diversifying your traffic streams, and even your income streams. I own multiple software products and web apps; if any of them tanks I still have more than I need to live on. Actually, at this point, more than one could totally disappear and I would be ok financially.

The odds of you selling out and making $5M are ridiculously lower, and I mean hundreds or thousands of times lower, than making a few small apps that generate a full-time income.

If I removed the secret sauce parts it's just a blank Word Doc :-)

But seriously, there's not much in there that I can share at this point. However, as I implement and experiment with approaches I will be blogging about them.

Sure, I'll cover many of these in part 3; thanks for asking.

Sure; will do.

Sure.

I've purchased web apps and websites (and have colleagues who have done the same) for $1k-$2k that today make right around that each month. But those are the best results; that's not the most common outcome of purchasing in this range.

The most common purchase price is between $2k and $7k. Though I do feel like that's been creeping up over the past couple of years as this approach of buying becomes better known.

The more you can spend the better off you are; everyone's trying to buy in the $2k-5k range so there is far less competition in the $10k-$25k range. But $5k-$10k can also net you a nice app.

In addition, although this approach saves months of dev time it does take time to find deals. You either have to sift through sites on Flippa, which I did for years, or find deals and cold email like I did. It's not something where one day a deal just drops itself into your lap with no work invested.

The hardest one is the first one - once that's going you can use revenue from that to buy the second, and so on. This most recent acquisition was funded purely with revenue from the other 8-10 apps I've bought and revamped over the past several years.

Cool; I'll try to cover the things you raised in part 2 or 3.

>>On a side note, amazing job with the redesign. The new hittail landing page looks great.

Thanks!

>>One thing I noticed however was that you have an extra checkmark on the last row of the pricing page that doesn't seem to correlate with anything. Done on purpose?

LOL...that's awesome. I'm not sure how no one else (including me) has noticed that. Removing it now; thanks for pointing it out :-)

Good suggestions - I'll cover these as much as possible in the next 2 parts of the series.

For a look at valuation methods, check out this post from a couple years back...it's where I typically start from:

http://47hats.com/2008/07/a-tale-of-selling-a-microisv/

Where the owner of HitTail started from is anyone's guess, but I'm sure it was "as much as I can get" :-)

The results are not changing wildly week to week, but you do receive new suggestions frequently (depending on how much traffic you receive). And with this kind of SEO (long tail), the point is that if you write a single blog post or article focusing on the suggestion, you will rank on the first page of the search engine within a few days. That's the point of HitTail - it picks out terms you will very easily (and quickly) rank well for.

The algorithm has analyzed 1.2 billion keywords and been optimized to work well. If you get 1200-1500 uniques per month, HitTail will likely provide enough value to make it worth the cost.

>>Details on which costs you chose to attack first (technical debt vs. free subscriptions vs. UX) is something all web businesses should think about.

Good point. I'll try to cover that in more depth in parts 2 or 3.

>>How does the original owner feel about the revamped HitTail?

Positive feedback all around, both from the original owner and developer (they are different people). They've also made helpful suggestions along the way since they know this space quite well. I think they are happy that HitTail is getting a chance at a second life.

It sends back the referrer URL from the search engine that contains info like what keyword was searched on, whether it was paid or organic, which search engine, etc...

The JS doesn't have dependencies in terms of external libraries - self-contained but it obviously depends on our server since it makes an async call back to save the keyword data.

No, they vary pretty widely, even week to week. I have several years of suggestions now and new ones continue to come up every week as I add new content and my rankings shift in the engines.

Exactly. Asynchronous JS snippet on your site (so doesn't affect page speed) that sends analytics info back to our database, where our algorithm is able to analyze it and make recommendations.

Flippa - Focus on net profit. So reduce expenses and increase revenue if at all possible. Automate everything possible; the less monthly time investment the better. Then price it reasonably and gather inspiration from the posts that have done well on Flippa in the past.

Revamp - Very similar to the above: focus on net profit :-) Invest in one-time costs but reduce recurring expenses and increase revenue if you can. Find out who's getting a lot of value from your product and focus on making them happy; ignore the people who say the app costs too much. You can see a 10x or more difference in the amount someone will pay for your app based on whether it really does the job for them. Find out who's on the top of that 10x stack and make them love the app. Then find others like them.

The inventor of HitTail is very sharp - we're in touch every week or two as he continues to have insights into this space.

What else do you want to know? This is a multi-part series so I can go into more detail.

Windows 7 Laptop

There are 7 essays; 3 are new, 4 have been published previously.