
What hackers don’t know about business - tagx
http://blog.filepicker.io/post/28881520162/what-hackers-dont-know-about-business
======
oinksoft
Maybe somebody can translate the last paragraph into English for me. I read
the preceding paragraph several times and I'm coming up empty:

    
    
      Based on our experiences at Filepicker.io we learned that 
      it is important to delineate the differences when
      planning initiatives that drive growth, the amount of
      resources needed and the profile of team members required
      to drive the initiatives.
    

While we're going for pompous titles, how about "What newly minted MBAs don't
know about writing"?

~~~
robertpateii
"Understand the differences between these things, and don't mash them all
together. They each have unique requirements."

~~~
ananddass
Very true. As startups with limited time and resources I tend to stick
everything into the "lets figure out how to grow-lets do blogs, sell to larger
customers, plan distribution hacks etc." It is important to decompose the
business bucket and pick things that matter to my specific kind of business.

------
mindcrime
_Marketing is about getting the word out._ _Think about ads and blog posts._

That just sounds like advertising & PR. There is a lot more to marketing. To
crib the definition from Wikipedia (which sounds pretty close to the one I
learned):

    
    
      Marketing is "the activity, set of institutions, and 
      processes for creating, communicating, delivering, and 
      exchanging offerings that have value for customers, 
      clients, partners, and society at large."[1]
    

From the same page, another way of looking at it is:

    
    
      Marketing is used to identify the customer, satisfy the 
      customer, and keep the customer.
    

"Getting the word out" is important, yes, but that's not all there is to
marketing.

[1]: <http://en.wikipedia.org/wiki/Marketing>

~~~
dglassan
Getting the word out is only a fraction of what marketing actually is.
Marketing involves:

\- defining who your customer is (demographics, income, etc.)

\- gathering feedback from the customer through surveys

\- using that information to iterate on products/launch new products that
solve your customers pain points (if half your customers are left handed this
will tell you that you need to design your product for left handed people as
well)

\- packaging and designing how your product will look on the shelves

\- defining price points based on the data you gathered from your surveys

Not to be a jerk but it sounds like the author of this post hasn't even taken
a Marketing 101 course if he's defining marketing as writing blog posts...

~~~
ananddass
So traditional marketing 101 is geared towards larger companies with lesser
operating uncertainity and more resources.

As a startup, the key question that helps prioritize between everything you
mentioned is "what activities are hygiene activities, versus what are growth
enhancers?". Defining your customer, gathering feedback, iterating on product
and packaging all fall under hygiene activities. Meaning-if you dont get them
right they will hurt your ability to grow. Pricing the product right and the
rest of biz dev, marketing and sales activities are focused on enhancing
growth. In a startup, the center of gravity for the hygiene activity is the
product team (of course this depends on the type of startups). Thus, the job
of the non product folks is getting the product found and getting folks to use
the product.

~~~
dglassan
This isn't just geared towards larger companies with more predictable business
models. It's good business no matter what size company you are. Even startups
use these marketing techniques. And I'd argue that in a startup, everyone on
the team is a product guy.

define your customer: use analytics to find out where your visitors are coming
from. Is your audience just English speaking or should you internationalize
your site? What income brackets is your web app designed to cater to? Lower
end 99 cent app? Higher end quality software?

Gathering feedback: Startups can easily email their customers surveys and ask
for feedback

Iterate: When you talk to your customers, ask them what they like and don't
like about your app. Iterate based on their suggestions

Packaging: Landing page. Having good copy and a strong selling page. Simple
sign up flow and an on-boarding plan to help them get started and using your
app

Price points: Use surveys and the customer "persona" you defined above to
break up your customers into different price brackets and sell them features
based off what they want and what they can afford.

------
rkaplan
I think the name "Filepicker.io" is severely limiting. When I hear
"Filepicker.io", I think "easy-to-use library for handling user file uploads."
That is rather narrower than their description of the service on their blog:
"Filepicker.io helps developers connect to their users' content."

Don't get me wrong, I very much enjoy the Filepicker.io blog. I have never
used their product, but from their website, API docs, and blog they seem like
a well-run startup with a value-adding service.

Nonetheless, they are hurting themselves with such a specific name. It creates
the negative perception of "Feature, Not A Company" that Mark Suster talked
about on his blog: [http://www.bothsidesofthetable.com/2011/08/22/fnac-
feature-n...](http://www.bothsidesofthetable.com/2011/08/22/fnac-feature-not-
a-company/)

~~~
tagx
We've realized that now and are in the process of changing our name. I'd love
to chat with you about what you think of some of our ideas

~~~
kephra
I'm not your customer (because I prefer own root servers over cloud services,
and even prefer housing over hosting) - but I think you might stick with your
name, because:

1\. its a known (brand) name 2\. it tells where your product is strong

But I suggest to change the Enterprise pricing tag:

1\. Don't tell a price for enterprise. Enterprise customers have a high COCA,
so price is always negotiation. 2\. Offer enterprise features = Your services
runs at their servers, under their control, not as a SaaS, but as a normal
enterprise software that comes with installation support, consulting, ...

~~~
ananddass
Thanks for the suggestions. It's a delicate balance between appearing
"complete" with the offering versus leaving headroom for customization for
larger customers. Increasingly with the consumerization of the enterprise do
you think that custom development, consulting etc are a must have to servicing
an enterprise?

~~~
assemble
Usually. My group isn't IT, so with almost every purchase we ask for
customization. (IT gets custom stuff too, but they also buy a lot more off-
the-shelf stuff.) We have disqualified vendors for not being able to customize
their product fast enough or well enough. We pay (a lot) for this. While we
could write the code ourselves for a lot of these customizations, the vendor
can do it faster and it's easier for us to buy the software than increase our
headcount to do the work.

You'd be amazed at how much an enterprise is willing to pay for software, if
you have the right niche and are going to make life easier for a bunch of
people.

------
guynamedloren
> _...many in the software community don’t understand the differences between
> Marketing, Distribution, Sales, or Business Development._

Many in the 'business community' don't understand the differences as well. Not
being an ass or making assumptions - I'm speaking from first hand experience
here.

------
rmserror
a complexity theory error: "Just as you can reduce all NP hard problems to
3-SAT..."

you can reduce all NP problems to 3-SAT because 3-SAT is NP complete. you
cannot reduce all NP hard problems to 3-SAT. for example, all problems in NP
reduce to SUCCINCT-SAT, an NEXP-complete (and therefore NP-hard) set. good
luck reducing SUCCINCT-SAT to 3-SAT (despite how little progress in separation
of classes we've made, the time hierarchy theorem still indicates this is
impossible)

~~~
xmpir
great response! NP-problem discussions make me happy. for those not
understanding a word:
[http://en.wikipedia.org/wiki/Boolean_satisfiability_problem#...](http://en.wikipedia.org/wiki/Boolean_satisfiability_problem#3-satisfiability)

------
greghinch
I'll tell you what, I'd much rather be working amongst a team of engineers who
are learning to run a business than a team of MBA types who are learning the
ins and outs of software development. I'd put my money on a team of engineers
every time too. But I also steer clear of anyone who describes themself as a
"hacker". Code is a craft, MacGuyvering something together is no way to build
a sustainable business.

~~~
tatsuke95
And I'd put my money on a team of good people that doesn't involve members who
are willing to type-cast a person based on his or her degree.

~~~
greghinch
Didn't say anything about degrees. Ultimately it's about people who know how
to make things vs people who know how to talk about things. More often than
not, in the software world that equates to engineers vs MBAs. I'd much rather
work with people who can make and need to learn how to talk than people who
know how to talk and need to learn how to make

------
ananddass
The easiest way to grasp the difference is to think of the Attention-Interest-
Desire-Action paradigm.

This link has a basic primer <http://en.wikipedia.org/wiki/AIDA_(marketing)>

~~~
pizza
Theoretically (and likely), this could be applied to anything that involves
convincing: politics, debate, etc., of course with different media of action
e.g. voting. This is basically all you need to know about marketing, the
science of interest.

------
vilcans
So _this_ is what business people mean when they say programmers need to
understand business?

Apart from not knowing the exact nomenclature, it's embarrassing if
programmers don't know these things. It's pretty much common sense.

But now we know.

So, when will business people understand software development?

~~~
mindcrime
_So this is what business people mean when they say programmers need to
understand business?_

No. This is the thinnest sliver of a fraction of what business people think
hackers should know about business. See the link above to the "outline of
marketing," for example. Just marketing is a huge discipline with a very large
body of knowledge... add in distribution, support, finance, business
development, sales, etc., and there's a whole world of knowledge that a lot of
programmers don't generally have.

 _Apart from not knowing the exact nomenclature, it's embarrassing if
programmers don't know these things. It's pretty much common sense._

Sure, at the 60,000 foot level. But the devil is in the details.

Seriously, as popular as it is for hackers to mock "business people" and MBAs
and business school, do you really think that business school doesn't exist
for a reason? You think these guys just sit around and spew bullshit at each
other all day, graduate, then go on to run successful, real-world businesses?

Business, especially at scale, is fracking complicated. And a successful
technology company can't be all about _just_ technology OR _just_ "the
business." You really need a holistic approach (which means somebody, or
multiple somebodies have to understand the big picture) where technology and
the "business side" complement each other.

 _So, when will business people understand software development?_

Ya know, it would almost be fair for the business people to ask "when will
software developers understand software development?" We, as a group, still
don't do a good job of giving good estimates and delivering things that work
reliably without constant hand-holding and patching. But, to be fair, that's
often back to ill-defined requirements and unreasonable schedule pressure,
which still - IMO - argues for the need for a holistic understanding of what's
going on - that is, a shared understanding that's common to the "business
people" and the hackers.

In fact, I almost wish we could get away from making the distinction "business
people" and "technology people" (or "hackers") and drop the antagonistic,
adversarial atmosphere that often seems to exist.

~~~
vilcans
> This is the thinnest sliver of a fraction of what business people think
> hackers should know about business.

This sounds like programmers need to know _a lot_ about business. Of course
knowledge is a light burden and all that, but do really programmers _need_ to
know that much outside their area of expertise? Isn't a shallow understanding
enough? Otherwise, what would you need dedicated business people for?

> Ya know, it would almost be fair for the business people to ask "when will
> software developers understand software development?"

Good point! But then again, software development is difficult. It is hard if
not impossible to estimate the schedule and cost of creating something that
nobody has ever done before. And perhaps that is what the business folks need
to understand. The tricky thing as a developer is explaining this without
sounding like you're coming up with excuses for being late.

~~~
mindcrime
_This sounds like programmers need to know a lot about business. Of course
knowledge is a light burden and all that, but do really programmers need to
know that much outside their area of expertise? Isn't a shallow understanding
enough? Otherwise, what would you need dedicated business people for?_

Sorry, my reply was coming from the point of view of "hacker as potential
entrepreneur", not "hacker as employee of $FIRM." Yeah, if you're writing code
for an existing business, just doing normal "business as usual" stuff, then
you wouldn't need to know as much about the details of the business. I would
think you'd still be better off with _some_ knowledge of the "business side"
of things though.

~~~
vilcans
OK, then I understand your position better. This is hacker news after all.

BTW, I think that there's misunderstanding between software developers and
business people because software development is not as much about technology
and hard facts as non-developers tend to think. It is very much about
organization, people and processes. So in that way, software development is
more similar to business than business people expect.

------
nikcub
Most hackers I know understand all this, but minus the fancy business school
acronyms.

~~~
statictype
I would say there are many that don't ( I was in this pool until very
recently). This is especially true of selling to big companies. Hand holding,
dealing with RFPs, getting through to the right person inside to support you
and getting involved in internal politics are mind-bogglingly frustrating and
often not built on logic or rationality so it often doesn't make any sense at
all to hackers.

------
allstruck
I couldn't get past this sentence: "If it costs you more to get a customer
then you can possible make from them, your business is going to fail."

Seriously learn some English man.

The worst part about this is you're arguing that programmers should learn
business directly after stating that you argue about business managers not
needing to learn programming... Seriously where is your logic sir?

Maybe you can write an article about why you think business managers do not
need to learn programming (something I would agree with as a programmer), and
make sure you have it edited before posting.

------
riams
Doesn't LTV stand for "[customer] life time value," i.e. the amount of money
you'll be able to generate from a customer during his/her time with your
business, and not "long term value"?

~~~
caw
I picked up on that as well. Wikipedia seems to agree with us:
<http://en.wikipedia.org/wiki/Lifetime_value>

I agree with their points, but overall the article is just a little bit "off".
Maybe it's the bit about the integral. If you had a customer pay you $1 every
month, and they on average stayed for one month, your LTV is $1, not the
integral of 1*x (1/2).

------
bazookaBen
when marketing Filepicker to enterprise users, how successful was
referrals/friends/valley connections vs coldcalling, percentage-wise?

------
james1071
Part of wisdom is knowing that the typical hacker and the typical customer are
alien species, who cannot speak each other's language.

~~~
mindcrime
No they aren't. I wish people would quit perpetuating such nonsense. Promoting
this belief just makes the problem that much worse and adds to the adversarial
/ antagonistic relationship between hackers and the rest of the firm (and the
customers).

------
iblaine
And the death of the word 'hacker' continues...

------
fredsters_s
Very true.

------
drivebyacct2
This is why some schools are taking new approaches to integrating business and
computer science curriculum. Their graduates leave understanding business
basics, have worked in teams and even for clients on contracted projects.

