

DomainPolish: From MVP To Exit In 6 Months - dshipper
http://www.danshipper.com/110636263

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raffi
Congratulations. Our stories are a lot alike. I created Feedback Army in 2008
(I continue to operate it though). One thing I liked about reading your story
was the lessons learned part. For a novice entrepreneur there's a lot of value
in shipping something, marketing it, providing customer service, and dealing
with the whole process. You'll find it's a good springboard to what you do
next. Best of luck.

~~~
dshipper
Dude great to hear from you! I'd really love to talk some time if you're
interested. Feedback Army is awesome and I think we might have some cool stuff
to share. Couldn't find any contact info in your profile but my email is
dshipper [at] gmail.

~~~
ohashi
If he doesn't notice this, feel free to poke me, he's sitting next to me. I'll
bug him for you :)

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PaulHoule
$1000 to run something like that on EC2 seems like a lot. That type of site
could probably be run off one or two micro instances, and if you bought
reserved instances you can get your long term costs way down.

~~~
dshipper
I was running small instances - probably should have been micro. And there
were definitely ways to decrease costs and stay on EC2. Heroku is free though
so for me (at my scale) it seems like the best option for now.

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schusterfluke
Congrats, and thanks for sharing this.

The most interesting part of this post is the guy who wanted to build a
service that reviews you online dating profile. That seems like something that
has real potential.

In my experience, one of the most frustrating things about being on an online
dating site is that it's really hard to get feedback from women about how your
profile is perceived by them.

You send messages to a bunch of women and 90%+ never respond, but you have no
idea why. I would pay $$$ to find out why they don't respond, and I'm sure
that a lot of other people would as well (especially men).

Could this be built into a site like OKCupid? Perhaps some kind of revenue
sharing arrangement (between reviewers and the dating site) where users pay to
get feedback, and other users get paid to review the profiles of men or women
who message them(or maybe even those who don't)...and it's anonymous
feedback...or semi-anonymous.

~~~
dshipper
I really like the idea as well! From what I know the site didn't go anywhere
because the minimum advertising commitment for dating websites is in the
thousands. So I think he dropped the idea.

But definitely it could work for someone with some marketing skills and/or
cash to burn. It's something that can be built in a weekend as well. Feel free
to reach out to me and I can try to help point you in the right direction if
you're interested in pursuing it.

~~~
schusterfluke
Yeah, I think it would be very difficult to make this work as a standalone
service, but I think it could be potentially be very successful as an internal
feature of OKC or a similar site. It would be valuable to me to find out what
the women that I am interested in think of my profile, especially the ones
that don't respond to me. I would pay to get some decent feedback on myself.
One of the problems is that I see my own profile in complete isolation.
Actually, what I should do is go look at the profiles of other men to find out
what the competition is like, but I'm not going to do that. But there are
probably lots of women who would give me feedback on my profile if I paid them
even $1.

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chris123
Congrats on your first deal, Dan. Sounds like you learned some valuable
lessons along the way. They will serve you will in the future. Cheers. PS:
Will be interesting to see what new owner does with the site.

~~~
dshipper
Thanks! I really hope so - that's the beauty of doing all this stuff while in
school.

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stfu
Very interesting story and I love these low maintenance ideas. Congratulations
on that sale!

Can you elaborate a bit on how you drove customers to that site? I was looking
at a similar idea just a few weeks ago but search engine competition on
usability keywords is incredibly tough.

~~~
dshipper
In short: I drove customers poorly and infrequently.

The only marketing I did was through my blog/Twitter. That spawned a fair
amount of word of mouth and some other blog posts by people who had used the
service. Beyond that I think it was just people talking to eachother because
the product really does provide value if you're building a website.

I also have a hunch that the custom thank you videos played a part too but I
can't prove it.

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lchengify
Dan, great article and congrats on the sale. Domainpolish is a great product.

For the metrics did you ever set up Google Analytics? I typically tell
everyone to just install that first thing, it can give you ballpark estimates
for almost any basic metrics question with about 5 lines of JS on each page.

For EC2, I agree with PaulHoule that it's possible to save money if tuned
properly, but the learning curve is steep. I know I've served 5 or 10 minor
projects of a single mini reserve instance ($6 / mo) with no issues, but
getting a sense for it requires a bit of work.

~~~
dshipper
Thanks for your comment! I did definitely set up Google Analytics. But I
didn't have goals or Web Master Tools or funnels or anything like that set up.
So I had a few metrics but nothing really in-depth.

Yea I definitely could have done the EC2 experiment much more cheaply. But
Heroku is free if you're small scale like DomainPolish :) Thanks again for
commenting!

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daemon13
Good stuff, keep it up! When I was your age, I was making $200/mth through
hard labor, and it was 10 times higher than an average student :-) Since you
seem inclined on entrepreneurship, I would highly recommend that you tackle
negotiation skills, since those tend to define the financial outcome of
idea+implementation. You can start with Jim Camp book "Start with NO...The
Negotiating Tools that the Pros Don't Want You to Know" and reading about
Richard Branson, and go from there. Good luck.

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jason_shah
Congrats, Dan! Fully agreed that given how most projects land the entrepreneur
(and/or the investors) in the red, the real achievement here is executing an
idea and seeing it through the full lifecycle of a business, in this case,
through to a sale. The learning experience will be invaluable when you exit
your next company.

This was a great story to follow through Hacker News, and your candor, detail,
and introspection are admirable and indicative of the success ahead.

~~~
dshipper
Thanks Jason I'm glad you enjoyed following the story. It's definitely not a
huge exit but I'm happy to have turned a profit and there's more where that
came from :)

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sgdesign
When talking about "exits", it might also be useful to keep in mind the amount
of money you could've made while working a regular in the same period of time.

Of course I'll be the first to admit that working on your own projects is much
more fulfilling and interesting, but it does have opportunity costs just like
everything else.

~~~
dshipper
Definitely - although it's also worthwhile to take into account the fact that
you own what you produce when you work for yourself. So while after working
for someone else for 6 months I would only have cash to show for it, after
working for myself (very part time) for 6 months I had the option to turn what
I produced into immediate cash, or do anything else with it that I wanted.

But I definitely agree that it's something to consider.

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sandis
> I set up 3 instances (two production and one staging) and thought I was a
> boss. [..] Lesson learned: don't use anything but Heroku until you have to.

Did he really need 3 instances? Or even a separate staging environment?

~~~
dshipper
Thanks for the comment! Obviously 3 instances were too much. But the point
remains that if you're running a low traffic Rails app it's a lot cheaper
(free) to host on Heroku than it is on EC2. And if you're running at the scale
that DomainPolish was that makes all the difference in terms of take home
profit.

~~~
ovi256
I was looking at Heroku as well for hosting some MVPs and I was wondering how
good they are for hosting Python. Any ideas ? Naively, I'd hope they're as
good as hosting Rails.

~~~
dshipper
I wish I could help you but I've only ever used them for Rails. I have used
GAE for Python and had a pretty good experience. I think that's also free at
the beginning.

~~~
ovi256
I was wondering about GAE as well. After the pricing change, it looked like it
got horribly expensive. Any comments on how a side-project would do on the
free plan ?

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mosburger
I'm sorry for being a total idiot - what does MVP stand for? :(

~~~
_bbs
Minimum Viable Product.

~~~
mosburger
Thank you!

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iambot
Congrats on the 'exit', and on all you learnt from it. Looking at your stats
at the bottom of the post, what exactly is meant by 'Fee to License'?

~~~
dshipper
So I ended up licensing the codebase to someone else so he could build a
different Mechanical Turk app. I kept all the IP but he got the codebase to
use. Thanks for asking I'll try and make that more clear in the post!

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ryanwhitney
Care to go more in depth about the pricing strategy? It seems as backwards as
it gets. Had you seen it work somewhere else?

~~~
dshipper
Not really. Yea it's actually just stupid looking back at it. But I hadn't
done any pricing before and I wanted to experiment. So now I know at least I
won't make a boneheaded mistake like that again :)

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angryasian
so every time I sell a site on flippa thats an exit now

~~~
Zakuzaa
Yes it is an exit, technically.

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suking
Ummmm, congrats, but it sold for $3,500 - that's not really an exit imo. It's
like selling a decent domain name.

~~~
dshipper
Thanks! I guess to me, more important than the selling price, was the process
as a whole. It's a product that I took from an idea, built out and eventually
sold. In there were a lot of lessons that I thought might be interesting to
people.

$3,500 might not be a lot to you. And obviously it's not enough to go away on.
But it does mean that I can work full-time on my startup this summer.

~~~
brico
congratulations on your experience!

It really is difficult to name a price, I would have ignored any offers below
10-15k but on the other hand you can now concentrate on a new project and for
6 months from 0 to sale is remarkable.

~~~
Ecio78
according to some people a quite common exit is between 12 and 24 months[1] of
the net profit. Considering his expenses (1700$) and sales (2500$), and
initially ignoring the licensing fee, he had 800$ profit for six months, so
let's round it to 150$/month, 3500$ is 24months of this profits. If we want to
consider the single licensing fee, let's say he licenses once a year, it's
1500+1800 = 3300$/year, and so 3500 is a 12month evaluation. Still acceptable.
10-15k$ I think it was not acceptable (by the buyer of course) with this
numbers, even thought he could have reduced significantly his EC2 expenses
(and so having a much higher monthly profit)

[1] [http://www.softwarebyrob.com/2012/02/28/the-inside-story-
of-...](http://www.softwarebyrob.com/2012/02/28/the-inside-story-of-a-small-
startup-acquisition-part-3/)

~~~
brico
I always assumed the 12-24 month-rule only applied to "content"-sites like a
blog or a forum, but Dan built a unique service that cannot be copied with the
same effort as a techblog or a bulletin board

~~~
Ecio78
the link I posted is about Hittail, that is surely not a "content" site but a
service

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shingen
Good write up. It's always nice when people share that kind of information /
data. If I learn one thing from the time spent reading it, it was well worth
it.

So, review a web site; review a dating profile (buyer). Why not a 'review
anything' service?

~~~
dshipper
Really glad you found it informative!

I think you could definitely white-label the DomainPolish idea and sell it to
people hoping to build a Review X service. The problem is that if you just try
to build a site yourself that lets you review anything it's very difficult to
target your customers.

People search for "get feedback on my website" not "site to review anything".
Picking a specific vertical makes marketing much easier. But it's a cool idea!
I can put you in touch with the current owner of the DomainPolish source -
he'd probably license it to you :)

~~~
dshipper
Agree if you have enough marketing power (or good press hookups) it's much
easier to make something like that work.

And definitely on the same page in terms of code. I like it to be mine!

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wilfra
Congrats. What was the justification for that price? A certain number of
months of earnings?

For something that required little work to maintain and produced consistent
revenue, that should be 18 months earnings at an absolute minimum. 36+ months
for this probably wouldn't have been difficult at all if you had put it on
Flippa or similarly marketed the sale. Not trying to make you feel bad, just
giving you some info for the future.

