Skedsheet Blog

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Archive for the ‘Strategy’ Category

Business plan – show me the money?

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We’ve been putting money into Skedsheet, but haven’t really thought about a business plan much.  Typically you need to think about finances, market, and plan for our products.  Here’s a swag at the finance part for Skedsheet.  Of course, the dirty secret of any business plan is that this is all a guess…

$ pillow by klynslisLet’s say that the cost of doing the beta version of skedsheet is around $100K – that’s development time, graphic design, and the direct costs of setting up a website, getting trademarks, and all of the other administrative parts of setting up a new product.  I think that’s the right ballpark. 

After that, there are the ongoing costs of running skedsheet.  We’ll need servers, which will probably start around $500/month, and grow as we’re successful.  I’m sure we won’t have all of the features right in the first version, so there’s going to be ongoing development, and I’m sure that  we’ll have to spend time on customer support, too.  Let’s say that adds up to $2000/month for each. 

Even if we’re willing to toss out the initial investment, that means around $5000 per month just to break even.   And if we want to recoup the original outlay in the first year, it looks more like trying to get $14000/month.  Zoiks! maybe instead we want to break even on the original investment in 2 years, which makes it closer to $10K/month.

While we haven’t thought about price in detail, there are a couple of strategies we can take.  We’ve ruled out having expensive software.  Even if we choose a number as low as $100/month, chances are that we’ll need a sales process, and a sales guy to convince people to part with their money.

We can’t be totally free either.  That could get lots of users, but there’s not a chance of making money for just giving away our service.  So the answer is Free + Cheap.

Is a $10/month cheap?  $1?  I think that the right model for us is to have a small group of our hardcore users pay for the costs, and allow us to give away our software to 95% of the people who want to use Skedsheet.  So if the numbers I just pulled out of the air would work out, it’d be something like:

(Paid Users) x $10 = $10000, so we’d need a thousand paid users.  And if

(Paid Users) = (All Users) x 5%, we’d need twenty thousand people using Skedsheet before it makes financial sense.

So, the next  question should be “Does Skedsheet solve a problem for tens of thousands of people?”

Written by Harry Hollander

September 3, 2009 at 7:49 am

Posted in Pricing, Strategy

How do you sell something that’s free?

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We’ll probably have two flavors of Skedsheet – one free, and one paid.  I’ve been thinking about which features should be in each version, but I need to take a step back and ask myself:

“Even if it’s free, how do we sell this puppy?”

I know you don’t need to “sell” free stuff – at least not in the traditional sense.  It’s much more about providing something in exchange for your time.  Since we’re giving something valuable, and making it easy to share…each of our “free” customers should become an advocate for our software.

But, we still need a Unique Selling Proposition:  What’s the reason to even look at us?

I expect people to compare the cost (in time and effort) of Skedsheet to using Outlook and Excel.  I’d argue that Outlook and Excel are both effectively free – I bet you didn’t pay for them and you already know how to use them. 

Here’s what I’d want to say:

With the system you have today, you’re re-typing some details from your spreadsheet onto the calendar, and figuring out how to show it to other people. 

Of course, there’s the chance of making mistakes that cost big bucks, as well as time wasted looking in more than one place for information. 

I think we’ve another unique concept in Skedsheet that I haven’t seen touted other places – the idea of multiple dates being tied together as one “job”.  I don’t know how to describe this well – but that’s what ended up being the defining feature for our JobTracker software, and it seems like it will apply more generally through Skedsheet.

But, because it’s free, there won’t be a salesperson telling you any of this.  Instead, I assume the sales pitch will be:

  1. Right here, with us writing about our software on this blog.
  2. An demo video that will explain everything clearly.
  3. Stories and examples of how other people use Skedsheet.
  4. Skedsheets that you see because a friend shared them with you.

Written by Harry Hollander

August 12, 2009 at 7:01 am

Posted in Pricing, Strategy

Take a hike – fun and productive meetings

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Sitting around a conference table is one way to talk about company strategy, but there’s another way.  I like to take a hike.

IMG_0195Getting out of the office is a good way to shake things up.  As time goes by, we are learning that we should actually plan to be out – doing something active really gets our creative thoughts working better.

A few years ago, when we had our sales meeting for JobTracker, we planned to have a little time off to go to the beach, boogie board, and hang out.  It was just half a day out of the whole time we had allotted to get together.

At the beach, while we were all floating in the water, we came up with a new product, new pricing, and talked about new approaches to selling our products.  We didn’t even realize it at the time, but I think we made some fundamental changes to the business – figuring out that we need to keep trying to  undercut our existing products with new ones that are cheaper and easier to use.IMG_0179

About a year ago, Ted and I were trying to hammer out some features – sitting in my office, getting bored and hungry, and not making any progress.  So, we decided that it’d be a good idea to walk to lunch and think about it when we got back. 

Instead, we kept talking through a problem that had been frustrating our customers and making support hard.  And, on that walk we came up with a different approach.  Looking back, we radically improved one of the hardest parts of our software.

Now we just came back from our strategy meeting – and we walked or hiked the whole time.  And once again, we planned some radical changes to our business, marketing and sales.  And once again, my to-do list has 15 new things on it.

Written by Harry Hollander

July 31, 2009 at 7:14 am

Posted in Strategy