
Pursuing a Business I'll Love - luu
https://mtlynch.io/retrospectives/2020/01/
======
ssivark
I found this tidbit interesting:

> _Another recurring theme in interviews was that nobody wanted a managed
> service. This surprised me because so much of the trend in software in the
> last 20 years has been toward SaaS, managed services, and monthly payments.
> Sheet metal shops wanted none of it. [...] While SaaS businesses often
> highlight the advantages of low up-front cost and minimal IT maintenance,
> sheet metal shops didn 't value these things. Independence mattered far more
> than convenience or cost. Multiple shops told me that they didn't want their
> businesses grinding to a halt because their software vendor went out of
> business or experienced a network outage. I asked if they minded maintaining
> their own servers, and I was surprised to hear consistent “no"s. [...] Given
> that some of these businesses have been operating for 70+ years, I see why
> they plan to outlast their software vendors. Still, this sentiment surprised
> me because it seemed to contradict most of the conventional wisdom about
> SaaS sales._

~~~
m0zg
>> seemed to contradict most of the conventional wisdom about SaaS sales

"It is difficult to get a man to understand something when his salary depends
upon his not understanding it." \- Upton Sinclair

Look at where this "conventional wisdom" comes from and it'll all fall into
place.

~~~
kristianc
There are SaaS vendors which are very successful at selling into contractors
and subcontractors of all sizes. I know, as I work for one of them.

~~~
m0zg
And I'm not disputing that. I'm just saying that SaaS vendors are going to do
their best to convince you that SaaS is the only viable choice, whereas for
many businesses on-prem is just fine and it isn't going anywhere, because it
works.

------
dhruvkar
Awesome post, Michael! Love the openness and humility:

>> I thought that rewriting the Zestful website as a static site would improve
its SEO. Sadly, Google Search Console suggests that it had a negligible
impact, the enterprise customer approached me only a few days after I rewrote
the site, so I can pretend to myself that the rewrite was responsible for
~$3.9k in additional revenue.

I had a chance to connect with Michael (about keto stuff) a couple years ago.
He had reached out in a very humble, welcoming way.

On the call, I recall I pompously gave him advice, not realizing how far ahead
he was on his entrepreneur journey. He graciously welcomed it all, and let the
conversation flow.

Looking forward to learning from you and reading future posts!

~~~
mtlynch
Hey, Dhruv! Good to hear from you again!

I wasn't being gracious at all. You had a lot to teach me! You were great at
building a community and an engaged following in a way that I still haven't
been able to replicate for my keto site. When I write ad copy now, I remember
the good tip you shared with me about writing it as if to a single person.

------
mtlynch
Author here. Thanks for reading, everyone!

It's a surprise to see this on here because I mainly write the retrospectives
as an exercise for myself and don't expect others to find them very
interesting.

I'm glad there were lessons I learned in this one that people found useful or
fun. I'm running around today, but I'll be back on later tonight to respond to
comments.

------
davnicwil
Great post, as usual from Michael! One kind of broad lesson I get from it is
that, though it's tough to resist the urge to just build stuff because that's
the comfortable and seemingly most obvious way to make progress on an idea, it
really always pays off better to figure out what people want first.

The metal shop example was a surprising and good one - so some businesses
actually _don 't_ really want you to solve their problem in the best way, they
want you to solve their problem adequately but it's more important to give
them flexibility and options for the future.

~~~
mtlynch
Thanks for reading David! I've been enjoying your blog posts as well.

------
ErikAugust
You could sell an unlimited local shows access pass. You could call it
“InfiniteJest”.

~~~
mtlynch
Haha, I love DFW and that book, so this made me laugh.

~~~
ErikAugust
Awesome, I figured since you are making a comedy site I might as well go for a
joke.

------
ninetax
I remember your first post about leaving Google a couple years ago, and it's
been neat seeing the consistent updates since then. Congrats on the revenue!

~~~
mtlynch
Thanks for reading! It's nice to hear that you still remember my quitting
Google post.

------
gbersac
If you are into customer interview, I highly recommend this book which is
about design process, and have a huge focus on cutomer interview :
[https://www.goodreads.com/book/show/32493686-when-coffee-
kal...](https://www.goodreads.com/book/show/32493686-when-coffee-kale-
compete?ac=1&from_search=true&qid=QPwthiTs7f&rank=1)

------
tra3
I really appreciate posts like these. One day I’d like to run a small SaaS.
Posts like these provide a glimpse into how it’s done.

The biggest insight is what makes me a good technologist, does not make me a
good anything else (entrepreneur, SaaS proprietor). I gotta figure out how to
get there.

------
peteforde
I found your discussion of the sheet metal concept really interesting because
as you found out the hard way, there's an awful lot of behavioural science in
play.

The line about Word having too many features is that everyone uses 10% of the
features... the problem is that everyone uses a slightly different 10% of the
features.

One thing you should try hard not to do is look at the competition and write
it off as crap. It's highly unlikely that your antecedents set out to make a
shit product. It's likely that when they were starting out, they wanted to
create something efficient and streamlined, but then years of paying customer
feedback took things to where they are today. The folks at 37signals always
used to remind us that it's much easier to add a feature than it is to remove
one.

I wonder how much of the shopkeepers reactions were fighting change vs just
not trusting someone who didn't come from where they came from. There's real
class anxiety around the blue collars vs the 20-something software millionaire
set (which is likely how they saw you, as the other, even if you're actually
their neighbour). I wonder what would happened differently if it was the owner
of the first shop leading the pitch. I often advise founders that they
shouldn't get into any business where one of the founders doesn't have deep
industry experience and connections. If nobody on your team has ever managed a
hotel, it's highly likely that you will fail to disrupt hotel management.
Anyhow, it's unclear from your writing but seems like your first customer guy
was just that - a customer. In other words, he found someone to spend a month
doing free fan service for an idea that if he was truly that excited about it,
he would have hired you or at least proposed a partnership and been much more
aggressively involved in doing the initial customer development conversations
with you.

I'm intrigued by the notion that they have no problem installing their own
servers. This pretty much lines up with a certain segment of blue collar and
[what I'd describe as Meyers-Briggs 'S'-type professions]... heck, I've seen
those computers. They are always covered in a slick of oil and dust
particulate. I wonder if they would have been comfortable with an on-site
solution that is _also_ connected to a central service, like Github
Enterprise. In this way, they have working infrastructure even if you decide
to ditch software for comedy, and you can both push new updates and offer
remote backup (which is good for risk mitigation) as a paid extra service.

Do sheet metal shops have a trade magazine? Is there an annual sheet metal
trade show in Vegas? You might still find it interesting to attend.

Note that _of course_ you're not passionate about sheet metal. The entire
premise is ridiculous because even the sheet metal people see it as a job. The
whole point of doing something unsexy is that in some ways it's hard because
not everyone is willing to do it. I would change and do some things
differently, like getting that first customer to put a lot more time and money
on the line to explore the concept in a partnership capacity, but if you want
to follow the FreshBooks trajectory you have to start with a fractional subset
of functionality targeting a micro-demographic and THEN grow into the Intuit
competitor over the next decade or so. There was never going to be an
overnight success and you'll probably need someone to put in some adventure
capital so that you don't burn out after a single month of customer
development.

While it's true that you failed to come to the table with a solution to a
hair-on-fire problem the other sheet metal shops were having, try to remember
that they have good reason for conservative skepticism about something that
could turn their business upside down. A lot of this stuff is just an
expression of the lowest levels of Maslow's Hierarchy. Everyone wants to be
the hero of their tribe, but nobody wants to be humiliated in front of their
tribe. The only way to sell into those shops would be for your first customer
to make the leap, and then have someone else that already agrees with that
customer make the leap and show everyone else that it's safe.

[https://www.youtube.com/watch?v=V74AxCqOTvg](https://www.youtube.com/watch?v=V74AxCqOTvg)

It's not the first customer that is the most important. It's the second one!
Also: flying doesn't kill you, landing does.

In the end, his comments about how someday they might need the extra features
is probably most telling. Deep down, people are scared of the future and they
make a lot of irrational decisions based on things they've already done but
also on things that they imagine they will do in a perfect future. People will
double down on purchases that they've already made so they don't have to
confront the quality of their first decision. And people will buy books on
Amazon that they don't have time to read because in an imaginary aspirational
future, they have an opportunity to real all of the books, and that person
will be so smart and awesome compared to themselves today. A huge amount of
purchasing in North America is aspirational. Kitchen appliances much?

Onto the comedy app! Bandsintown/Songkick for Comedy is a really great
concept. I agree that scraping is a fools errand. However, it's also really
important that you replace scraping not with your time but with someone you
hire from the internet. Not only is your time way too valuable, it's not a
realistic test of what will be necessary to scale it even a little bit. I
definitely think that you should find some comics willing to pay even a token
amount to use your service to host a reasonably nice homepage for them. You
might find it useful to watch this presentation by the founder of Bandcamp at
#XOXO. [https://www.youtube.com/watch?v=MaUkS-lr-
ZM](https://www.youtube.com/watch?v=MaUkS-lr-ZM)

I do have a small beef: you say that you were making an MVP. What could
possibly justify using Vue or any SPA to build something this simple? When did
it become the default to start an MVP using tools that are designed to solve
Facebook scale problems? I know that it's not just you and I'm probably
farting in the wind, but this topic gets under my skin because the day
absolutely will come where people look back on the SPAs-for-everything fad and
profess that "not everyone was doing it, just the people who didn't realize
they were conforming to the pack and reinventing simpler tech that already
worked better than it ever had in the past". Your filtering needs were pre-
solved by Isotope, for example.
[https://isotope.metafizzy.co/](https://isotope.metafizzy.co/)

~~~
jerf
"Note that of course you're not passionate about sheet metal. The entire
premise is ridiculous because even the sheet metal people see it as a job."

Limiting yourself to passion projects really limits the markets you can move
into because there's a lot of correlations in what we all have passion for.
Comedy is at least not in the A-list for programmers (it's not a text
editor/IDE, video game, or web framework, etc.), but it's still not sheet
metal, logistics, accounting, or something else that can have clear value to
customers, who will give you real money.

I have a clear through-line on how a sheet metal software shop will make
money, in quantities sufficient to live on, and indeed, to start hiring people
from. I've got a much less clear through-line on how a "comedy directory" is
going to make that money. I mean, I see one: ads, of course. But it's a much
more amorphous and fussy through-line. Heck, the reasonable best case for the
comedy site economically, "low-level life-style site", is perilously close to
the worst case for industrial software, "$0 in revenue". That's not a lot of
daylight there in business terms, partially due to the volatility inherent in
an ad-based business.

Not saying you should _hate_ what you work on, but opening things up to things
that you're doing to make money broadens your possibilities a lot. You may
well find some unexpected passions along the way.

~~~
peteforde
Yes to everything you just said, with the added bonus that many people who
develop a career around their passion develop a passionate hatred (or worse,
boredom) for the thing that used to bring them happiness. I would go so far as
to consciously try to keep your passions separate from how you pay your bills.

Yes, this also applies to porn stars.

------
wazoox
I don't see anything on this page but a couple of headings and some pictures,
with large swaths of whitespace, bullets without any item, etc. Neither in
Firefox nor Chromium.

I had to switch to reader mode in Firefox to get any text?

The same behaviour occurs on all the website...

What gives?

Here's a capture for anyone interested:
[https://demo.intellique.org/nextcloud/index.php/s/xM6QCQXReF...](https://demo.intellique.org/nextcloud/index.php/s/xM6QCQXReFSHzee)

~~~
taysix
That is strange. I have nothing to share except that I don't have this issue.
MacOS, Firefox 72.

------
RickJWagner
Thanks for sharing all this, author.

I've been a corporate coder all my career, but sometimes wonder what it must
be like to run my own show. Your writings are highly interesting.

~~~
mtlynch
Thanks for reading! I'm glad you're enjoying the posts.

------
leommoore
Thanks Michael, I appreciate your post. So much of being an entrepreneur is a
series of small uncertain steps that keep you moving in the right direction

------
iantimothy
hello from Singapore! I've been performing standup comedy for about six years
as a hobby. Anyway, last year I went to London and Berlin and I found sites
like [https://www.opencomedy.com/](https://www.opencomedy.com/) and
[https://comedyinenglish.de/](https://comedyinenglish.de/) super useful in
finding open mic gigs to perform at. I know in the post venue owners and
bookers were mentioned but wanted to highlight that for comics who travel,
sites like yours are super useful to us too albeit we aren't the ones really
making the money.

~~~
rwmurrayVT
Holy fuck, the opencomedy website took over 12 seconds for me to load.

~~~
war1025
Loaded basically instantly for me.

Facebook, on the other hand, often takes nearly a minute for the UI to be
fully rendered.

------
ilrwbwrkhv
These days good posts on HN have very few comments. Have the hackers left?

~~~
jimhi
I have also noticed a general trend of less hackers lately. I think there was
a temporary surge because the social network movie and all these tech
companies IPOing and making everyone rich that finally died down recently. I
think the application rate to Y Combinator itself also flatlined or decreased
in the last couple batches

~~~
r_singh
> I think the application rate to Y Combinator itself also flatlined or
> decreased in the last couple batches

Would like to know more if you have a source.

~~~
jimhi
My source was estimating this with other YC folk, but here is what's publicly
known.

~200 companies a batch and supposedly a 2-3% acceptance rate puts it at
6,600-10,000.

They stopped updating their statistics:
[https://twitter.com/sama/status/618247698378985472](https://twitter.com/sama/status/618247698378985472)
and [https://blog.ycombinator.com/yc-portfolio-
stats/](https://blog.ycombinator.com/yc-portfolio-stats/)

If it kept growing they would have proudly put that everywhere.

At the same time they introduced startup school which got 15,000 applicants,
many of whom would have applied to Y Combinator but chose the startup school
instead.

My bet is it peaked around ~8,500 and decreased when they introduced the
startup school program.

~~~
mvanga
Startup school companies were required to apply to the YC main program in
order to be eligible for the $15k grant, and there were 30k companies that
were part of SuS in 2019.

Also, from the figures presented at the conclusion of the program last year,
there were ~23k applications to the 2019 summer & winter batch in total.

~~~
jimhi
So roughly 10,500 then? These figures were shown at demo day?

~~~
mvanga
There wasn't a specific breakdown, but I'd guess so. You can find the
presentation here:
[https://www.dropbox.com/s/cq1fqp1zlkza3rf/SUS%202019%20By%20...](https://www.dropbox.com/s/cq1fqp1zlkza3rf/SUS%202019%20By%20the%20Numbers%20-%20with%20Notes.pdf?dl=0)

------
gyvastis
Love the One-Line summary. I wish more people would do that. Helps to decide
whether or not to invest my time or not.

------
curyous
Fantastic, inspirational.

