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Ask HN: Learning the business-side of things as a developer?
211 points by hvasilev on May 2, 2020 | hide | past | favorite | 48 comments
What are some good source for learning the fundamentals and specifics of the contemporary software business?

What software-specific business books would you recommend?

I think it really depends on what kind of software business you want to create.

For example, being a solo founder running a profitable bootstrapped SaaS business requires different skills than a venture-backed B2C social mobile app!

If you want the former, I suggest you read interviews and follow companies on IndieHacker: https://www.indiehackers.com/

You'll find lots of resources and case studies of people that made the switch from developer to founder.

I quit my software developer job two years ago to build a SaaS API business with a co-founder. We're at $4500 MRR and we are documenting almost everything we do: https://www.indiehackers.com/product/scrapingninja

About business books, Traction[1] is a must-have in my opinion as a developer. You'll learn a lot about marketing, which is often the problem most developers face when launching their first company.

I also love "Start small stay small, A developer’s guide to launching a startup with no outside funding" by Rob Walling.

If you need solid advice in terms of code & technology choice/architecture to launch a startup, you should read Hello Startup.[3]

With these three books, you'll have a solid understanding of what to build, how to build, and how to market your software.

[1]: https://www.amazon.com/Traction-Get-Grip-Your-Business/dp/19... [2]: https://startupbook.net/ [3]: https://www.hello-startup.net/

Maybe you meant to link Traction[1] by Weinberg & Mares? You've probably linked the wrong book with the same name.

[1] https://www.amazon.com/Traction-Startup-Achieve-Explosive-Cu...

Document almost everything you do. Spot on. That’s something we missed entirely.

We're bootstrapping SaaS service as two co-founders for two years already. I would say don't document anything except the code (if you really want to). Don't track anything, don't create any reports of some sorts for the sake of creating.

Only thing you should really care about is how you product solves pain points for the user. Measure user retention and revenue.

As a young enterprise you should only care about how to survive and how to get users. Nothing more, nothing less.

When I said documenting, I was thinking about publicly documenting what you do, in order to create an audience around your company.

That's really great, especially if people buying your software are also interested in entrepreneurship.

More like blogging, which is a really good way for long term growth

Not to bring too much of a traditional business view to HN, but measuring margin is arguably more important than measuring revenue.

Started as a solo developer, spent 10+ years to grow it into a small business with 40 employees.

The hardest lesson for me was that at the crux of it, business is all about scarcity. There is no other magic out there. A great question to ask yourself is: How many people want what I sell and how many people are already serving it.

Business is about being in the right market with the right product, and then differentiating against all other players in the market. Once you figure this out, you will solve most of the operational problems.

Peter Thiel has a great talk at YCombinator on how "Competition is for Losers": https://www.youtube.com/watch?v=3Fx5Q8xGU8k

It also vastly depends on your goals. Thiel's advice is great if you are setting out to create the next Palantir, Facebook or Paypal.

If you're looking to bootstrap a passive-income business as a solo developer, it's not as useful. In fact I'd flip his advice on his head and instead of "Build a Platform" say "Build a successful and revenue positive business off someone else's platform with the aim of being acquired by it some day."

Do you agree with Peter? I guess the angle he is looking at as a huge player in the market, where he couldn’t get bigger. So, it’s is true to play his strategy.

On the otherhand, it is nearly impossible to not having competitors. Especially for young companies. Since most of the human needs (or demand) already have the solution (or supply)

imo this is by far the most valuable advise. there are so many books out there giving philosophical advice on how to start a business, but really all that matters is what do people want and how many others are supplying it.

I've lived for 10 years solely from the revenue of an indie web app I wrote, so I guess my experience is applicable in so far as you're also doing bootstrapped/shoestring investment web applications.

I just started a YouTube channel where I give behind-the-scenes looks at how the technical and the business sides connect.

Specifically, I'm covering things like

- Experiments in SEO (from outsourced freelance content to microdata, to preserving SEO juice when user-generated content changes)

- Basic Google Analytics game

- The surprising hidden costs with payment providers like PayPal/Stripe

- AB testing

- The hell that is sales tax accounting

- Using data to decide what features to build (minimal viable features), so you don't over-invest limited resources in uncertain rewards.

- Technical cost-cutting (e.g. having a shitty looking admin area, knowing what not to test)

- Handling customers gracefully (e.g. setting expectations about response times, letting them yell at you and still feel zen, why you should always give refunds)

So, for a frank look at one particular programmer's/solopreneur's take on the above, you might get value from my channel: https://www.youtube.com/watch?v=aCzT-LQI6x0

I'd like to know more about the last point. Why should I always give refunds?

"letting them yell at you and still feel zen". I don't know how to phrase the question, but is there something you came to understand in order to get there?

I highly recommend reading about the business model canvas (definitely get this book [1]) and the "double diamond" framework [2] in design thinking. I'd also recommending reading some Steve Blank [3] for the "mainstream" understanding of "startup business".

The Lean Startup [4] is often recommended, but I've been told it's extremely beginner-level (though I haven't read it, so my analysis might be unfair)

If you want to get really in-depth, there's a lot of really great interplay between the design discipline and entrepreneurship that is often overlooked. "Design Thinking" is much more than a buzzword, check it out.

[1] https://www.amazon.com.au/Business-Model-Generation-Visionar...

[2] https://www.designcouncil.org.uk/news-opinion/what-framework...

[3] https://www.amazon.com/Startup-Owners-Manual-Step-Step/dp/09...

[4] https://www.amazon.com/Lean-Startup-Entrepreneurs-Continuous...

Blank provides a nice framework for thinking through a business idea but there are companies still selling software for dialup modems and your grocery store (in-spite of terrible fundamentals) is still in business.

Oh definitely! My thoughts are mostly aimed at your "stereptypical" SV-style venture.

Small business is an entirely different, and almost completely distinct, field (that I have little-to-no expertise in).

If you've got some time - there are twenty pages of archived blog-posts categorized as "mba mondays" at Fred Wilson's blog. His content is quite accessible and frequently has good suggestions for additional reading. E.g., the first couple of posts are the basics of finance and accounting: https://avc.com/category/mba-mondays/page/20/

Quite a lot of books I want to recommend are already here. - Hard things about hard things - Good Strategy / Bad Strategy are a couple of books that can help here

If the purpose of this exercise is to improve your overall understanding, I would recommend something more fundamental than above (software-specific business books). Read some Macro Economics, articles around industries you are interested in (SaaS, Mobile, etc.) - especially historic ones which give you more foundational understanding.

Also, I strongly recommend not doing an MBA program if knowledge is what you seek.

Are you working in the industry at the moment? The best way to learn is talk to people who are closer to the business side - product managers, sales people, finance, and so on. Also software touches on a lot of industries, so you might want to narrow down a little what you mean by software-specific business.

Some books that I liked:

- “Good Strategy / Bad Strategy” : it’s an introductory book to business strategy with tons of examples in the software/hardware business.

- “Understanding Michael Porter” is another one about business strategy that I enjoyed.

- “Well-Designed: How to Use Empathy to Create Products People Love”, a book about product design with some interviews from the industry (I enjoyed the interviews)

- “Why We Fail: Learning From Experience Design Failures” another book about product design using some well known cases as examples.

- “Sense and Respond”

If you want to learn the basics you don’t look for specializations.

Business is business, the trade is far less important and delivering software instead of garden furniture doesn’t make you special.

That’s largely true, but the variable vs fixed costs economics of software is somewhat unique vs selling and delivering garden furniture.

There ofc will be niches but overall your business plan would be much more dependent on the type of service you provide, sale channels (B2B vs B2C), volume etc.

Also many people conflate with a software company with a company that provides services through software.

There is a huge difference between say a commercial software company like say Sage, Microsoft or Oracle and other “software companies” like Uber or InstaCart.

All of these have drastically different business models even within the same category.

Then you have the software delivery as a service companies that can range from consultancy and staff aug to full out project outsourcing.

But in general if someone wants to learn business fundamentals they should learn business fundamentals before trying to apply it to a specific field.

Like others have mentioned it depends on your goals.

Do you want to build a passive income side business you can run from the beach? Check out The Personal MBA. https://personalmba.com/

Do you want to build a huge rocketship and IPO? Check out Y Combinator's "How To Start A Startup". https://startupclass.samaltman.com/

While these are not "software-specific" business books, I would say it's more important to spend time mastering the fundamentals[1] of business, which is the skill of finding people who want to pay for what you have. Everything else like management[2], operations[3], and marketing[4] can come secondary. This may sound cliché only because real business skills are boring, the same way "To get healthy, diet and exercise" sounds boring.

[1] https://jamesclear.com/fundamentals

[2] Marc Andreessen: The Hard Thing About Hard Things

[3] Eliyahu Goldratt: The Goal

[4] Chip and Dan Heath: Made To Stick

Crossing the Chasm

The Challenger Sale

To Sell is Human


These books have all been super helpful. You will need to primarily learn sales, this is the oxygen of a business. All cash comes from there. The other main thing is learning to speak to non technical users and then turning that into messaging and marketing. For most of the business details you can find software or services.

Find a non technical cofounder, upskilling your business acumen during the search.

What do people mean EXACTLY when they speak about learning "sales"?

What is an example of using "sales" knowledge in a sass application?

Where exactly is the line between sales and marketing?

Is copy on my landing page sales or marketing?

I am so confused.

These books will explain better than I can. Assuming you come from a technical background like myself... and in a B2B SaaS context.

Sales is the process of helping others solve their problems and then showing how your solution is the best choice. As a technical person, we are actually best positioned to succeed in modern sales. The complex sale, what today's SaaS is, involves understanding their situation, teaching or offering insights that get at their true problem, helping them to construct the best path forward, and then showing how your company's solution helps them get their best.

Sales and marketing are highly coupled, along with customer service and other post sale ops. There are funnels or channels for how people find your business, progress through the sales cycle, and eventually become paying customers. Marketing is the long-term, front running process to create awareness. Sales is the in the moment process of filtering potential customers and guiding them through the funnel to a closed sale. Post sale operations Ensure the success and lasting relationship with your customers. All three are critical to a healthy, successful, and sustainable business.

Copy on your website isn't necessarily specific to sales or marketing. Every interaction the customer or user has with your company is part of branding, marketing, sales, and overall success. The key here is that you want to consistent message and that message should speak to the customers dreams goals and aspirations. What happens with technical founders often, is that they talk more about features and technical specifications than the benefits of the product from a customer's point of view. here you want to spend as much time as you can with your users especially early on. They will inform you how they think about your company what you sell and give you the language to use in your copy whether for marketing sales or documentation.

I highly recommend you pick up these books they will open your mind as they did mine to sales as a very different thing from what we know in popular media. If you have the mindset that sales is largely pushing like a used car salesman, then these books will give you a fresh perspective on the reality of who is most successful in a B2B sales situation. It's not so difficult to learn sales as a technical person, in fact it's far easier than the other direction. so worrying now about feeling confused and lost at this point, if you do your learning you'll be capable of crushing it in sales.

"Sales is the process of helping others solve their problems and then showing how your solution is the best choice"

So is it a philosophy of some sorts? Mental mindset?

Why is it called "sales"? To be purposefully easily confused with what a regular person understands the world "sales"?

This is all so strange to me. Every time I ask about "sales" I get this very non specific, vague, metaphoric answer...

Get the books, read them, your understanding will increase and confusion decrease.

Both kinds of sales are "sales" as there is not just one kind. What you will see is that the popular media ("regular") sales is not actually regular, that there are also different types of sales people, and so on.

Basically your exposure and sales vocab are still underdeveloped, so reading some books will aid you greatly.

Ok, I will risk and jump in, because I am curious.

That's the spirit! Books are super cheap knowledge. When your done with those, email me and I can point you towards more for your new questions that will come up.

Do you happen to be monetizing an OSS project?

Hey, no, I have build a website with free mathematics resources for university students.

I am getting good traffic and now I am looking for monetization options that would be non-invasive to the project (for example. I don't want crappy, non-relevant adds).

Patterns of Enterprise Application Architecture by Martin Fowler

This book is actually two books in one. The first section is a short tutorial on developing enterprise applications, which you can read from start to finish to understand the scope of the book's lessons. The next section, the bulk of the book, is a detailed reference to the patterns themselves. Each pattern provides usage and implementation information, as well as detailed code examples in Java or C#. The entire book is also richly illustrated with UML diagrams to further explain the concepts.

Armed with this book, you will have the knowledge necessary to make important architectural decisions about building an enterprise application and the proven patterns for use when building them.

I made my first $1M last year.

There are many good sales and general business books out there.

I’ve not yet found a good book on the fundamentals of the software business from someone WHO HAS ACTUALLY BEEN SUCCESSFUL. However, I have found plenty of books and articles by “thought leaders” (full of s*) and failures (full of cope).

It seems to me this industry has changed quite a bit over the past 50 years, yet the principles of general business not as much. Perhaps you could start with good business and sales books by people with the tax-returns to prove they know what they’re talking about.

> Perhaps you could start with good business and sales books by people with the tax-returns to prove they know what they’re talking about.

Classic survivorship bias

Well, there is higher chance to get better advice from a survivor than someone that didn't made the money in the first place.

Getting Real, by the makers of Ruby on Rails and Basecamp, is one of the only books on the subject that ever resonated with me. Also, it's free.

I joined a startup 6 years ago where the CEO has been extremely transparent about all business decisions over the year. I've learnt a lot from that.

Find a good mentor; someone that is a natural leader, looks past differences to accomplish a goal, finds common ground, has a track record of financially smart deals, and is well connected. Many startup CEOs can exhibit these qualities but ultimately emotional money deals or obsession with poor ideas lead to their downfall. Find someone that's had success in a "boring" industry.

It worked for me:

1. Go to your boss (or your company owner or CEO) and tell him about your willing to develop in this field.

2. Study economics. Not books (only) about startups etc, but more scientific ones.

3. If some business idea will come to your mind, just try it! It 99% times will be not successful, but you will learn something new.

4. Accept fact, that in modern economy most of results are mostly luck ;)

Maybe not software specific but a must read, for business in general, is High Output Management by Andy Grove. The best way I can describe it is: a manual on how to be a better business manager, for engineers. It's dry, its concise, its exactly what I needed when I wanted to learn more of the "business" side of things and it helped me greatly.

There aren't any fundamentals of the software business. The buyers get lots of drinks and dinners, bullshit presentations from product managers, pointless meetings, and make irrational decisions just like in everything else. Nothing interesting happening there, don't bother.

I don't have good answers to your questions. But I do have this advice: get a good lawyer and a good accountant. Don't try to do taxes or legal paperwork on your own. It's never worth it and the cost of doing it wrong is so high.

I’ve gotten by without a good lawyer so far. God they’re expensive.

Great accountants OTOH are cheap, and yes they are critical.

how do you look for one / vet them?

Sadly it’s been trial and error for me. I finally found a good one.

Maybe, fire fast?

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