Two indie SaaS founders—one just getting off the ground, and one with an established profitable business—invite you to join their weekly chats.
Similar Podcasts
Android Bytes (powered by Esper)
Android Bytes (powered by Esper) is the podcast that dives deep into the engineering and business decisions behind the world’s most popular OS. https://www.esper.io
Android powers over 3 billion devices worldwide and is the platform of choice for over a thousand companies. You’ll find Android on smartphones, tablets, watches, TV, cars, kiosks, and so much more. How does Google architect Android to run on so many form factors, and how do companies fork AOSP to make it run on even more devices? These are the kinds of questions the Android Bytes podcast considers each week.
Join cohosts Mishaal Rahman and David Ruddock, two journalists with extensive knowledge covering the Android OS platform and ecosystem, as they speak to system architects, kernel engineers, app developers, and other distinguished experts in the Android space.
Get in touch with us at Esper.io if you’re looking to use Android for your product — we have the experience you need.
The Laravel Podcast
The Laravel Podcast brings you Laravel and PHP development news and discussion. Season 5 consists of Matt Stauffer interviewing the creators of the most popular packages in the Laravel ecosystem.
Founders Talk: Startups, CEOs, Leadership
In-depth, one-on-one conversations with founders, CEOs, and makers. The journey, lessons learned, and the struggles. Let’s do this! Host Adam Stacoviak dives deep into the trials, tribulations, successes, and failures of industry leading entrepreneurs, leaders, innovators, and visionaries.
Getting Really Excited
Colleen Schnettler 0:00 Welcome to Software Social. I'm Colleen. This week, Michele and I discuss my progress getting my first product, a file uploading widget to 100 users. Why 100 because I'm going to sell it in the Heroku add on store, and I need 100 users before I can start charging. We also do a deep dive into what makes a good customer interview. And Michelle gets really excited about something called Prospect Theory. Enjoy the show. So I'm excited to share my numbers with you this week. For the past couple weeks for those that are new. I have been sharing with Michelle the numbers of signup, the number of signups I have for my new widget simple file upload. And as of this morning, I have 47 active signups.Michele Hansen 0:45 Oh, it was like 31. Last time, right? Colleen Schnettler 0:50 Yeah. So I really think using this marketing channel of the Heroku add on store has been tremendous for me. That's awesome. Yeah, I'm super pumped. So it's interesting, though, because when I first looked on, when I first signed on to my admin dashboard, it said 75 teams, but then I have to cross reference that with the people who have deprovisioned or kind of like, ditched it. So I'm still seeing a lot of people click the button to sign up. And then deprovision the add on but still 47 isn't bad. I'm pretty pumped about that. That's almost halfway to my 100. I need to get to actually make it a viable product. Michele HansenYeah.Colleen Schnettler Yeah! So that's good news. I and I also spoke with someone who has a really successful add on in the marketplace. And he showed me this somewhat convoluted way where I can get the user's email address, even if they haven't gone through the single sign on process that I've mentioned in the past. So something I want to set up this week as I want to set up a wrapper so I can get the person's email address as soon as they provision the app and send them an email right away to see you know, if they're having any trouble setting it up, I think. I think that's where I'm losing people, but not that many people are communicating with me. So that's my best guess right now.Michele Hansen 2:10 So you said 47 current signups? Colleen SchnettlerYeah. Michele HansenOr current current user, so and then. So that's 16 new people since last time we talked. Do you have a sense for like, how many of those have have gotten to that, that crucial single sign on step and like, have actually added it to?Colleen Schnettler 2:30 Yes, so of those 47,34 have actually gone through the single sign on. So 34 might actually want to use it for real is how I look at that. Only 16 have actually started uploading images or not, I shouldn't say images files. So there's a pretty big gap between showing intent and actually using it. So I really want to work on closing that gap.Michele Hansen 2:57 Yeah, and it kind of makes sense to me that there would be a gap for that, when, in order to see how it works, people have to install it first versus services that you can see whether it works first, and then sign up for it, would have a lower drop off in that conversion.Colleen Schnettler 3:19 Exactly. One of the things I want to do -- I have a long list of things I want to do, but they're all small, but they are there is quite a long list. I want to put because the Heroku documentation has to be formatted in this really specific way to comply with the Heroku requirements. Once you single sign on, I have the documentation and what I consider to be a much more user friendly format. So one of the things I want to do is on my normal marketing site, I want to add the user friendly documentation. So someone can see the documentation before they install the add on to see if it's a good fit because I know I'm someone -- if I want to install like a piece of software. I want to see your docs first because I want to see how good they are. And I want to see how hard it really is and how it actually works.Michele Hansen 4:06 Yeah, that makes sense to me.Colleen Schnettler 4:08 I also -- in very like I haven't taken Amy Hoy's course but like in very I had, you know I subscribed to her email is in very Amy Hoy fashion. As we've discussed, I launched this with a lot without a lot of boilerplate things. And one of the boilerplate things I didn't have is I don't have transactional email setup. Which means what I've been doing is, every night I've been signing onto my admin dashboard, copying the email addresses of people who signed up to an Excel sheet, literally emailing each person, one by one from my support account in Gmail. So in the beginning, that was not too cumbersome. It enabled me to see exactly where they were in the process like have they added files have they not have added a lot of files and kind of customize the email but now that's getting way too cumbersome and time consuming. So one of the things I really need to get up this week is transactional email. Yeah, it doesn't even take that long. It's, I'm somewhat like I do it all the time. It's just, I find it very mundane, because it's a very boilerplate thing. But it's such a, it's not such a pain, but it's kind of a pain, right? And so I tend to procrastinate the boring things like, like maybe most people, I'm like, Oh, I want to work on this, this this other feature, that's going to be so great. Instead of set up transactional email, but I'm losing people, right? Because if I don't email if you sign up, and I don't email you for 24 hours, like your path, you're over it, you have already made that decision, like your motive when you think of like a human motivation, at least for me, if I want something I want right now. So if I sign up for your software, it's because I want to use it right now. So if I can't figure...Michele Hansen 5:50 So is this the welcome email?Colleen Schnettler Yeah, there's no welcome... Michele HansenHere like this as like, here's the documentation. And here's what you've signed up for. Like, gotcha, okay. Yeah, I think I could help like, I know, our URL. Like, I don't think we had welcome emails to start. And we also, I think we manually emailed everybody who signed up. But it was so good for feedback like that early feedback was really critical for us. And it was part like, Hey, here's your documentation. But also, like, let us know if you have any questions about getting set up. Or if there was, you know, if there's anything else you're hoping that we do that we don't like, let us know. And we can see if we can add it.Colleen Schnettler 6:27 Yeah, that's exactly where I am. So basically, not even well, I mean, it would be a welcome email. But I want to get that as soon as they sign up. I want to fire off that email. Like, here's how you contact me, here's how I can help you. Let me know what you need. Let's let's do this. And yeah, hopefully I'll get I'll get more engagement, if I catch people early in the process of provisioning the add on.Michele Hansen 6:52 Yeah, that I think that sounds like a plan. Colleen Schnettler 6:55 Yeah. Okay. Good plan. So let's talk a little bit about the people I've talked with, I mentioned that I've been doing customer interviews, which has been super fun, I'm really enjoying it. So I did a walkthrough with a friend who's a UI/UX designer, like a very senior designer. And he gave me some tips that I really took to heart. And I thought they were great. And so actually, this week, was mostly all technical stuff. This week, when I worked on Simple File Upload, I was, I was kind of heads down trying to implement some new features that I really think are going to be great for the product. I believe I mentioned last week that I'm implementing the ability for the user to change the color, and the text color, the background color, the border color, I also am going to allow the user to add their own custom icon. So they can completely customize the look of this. And I'm going to allow them to add their own custom classes right in the dashboard. So I think that's going to be a really nice feature change. I'm actually done with that. But I haven't pushed it to production yet. And also, I'm really kind of excited about this next one, it's going to auto populate the drop zone preview box with whatever image you have saved in your database. So I'm excited about that one. Because I really wanted that I think I mentioned that I was doing this thing where I used it where it's like, you show the image, then you click a button to open the drop zone. And I really didn't like that it felt kind of clunky. So I'm really happy to have this preview feature, which I just got that one done. Again, I haven't pushed it out to production yet. But I'm pumped that that that's working. And I'm excited about that.Michele Hansen 8:33 Yeah, that's pretty exciting.Colleen Schnettler 8:35 Yeah, so so lots of like technical work, just trying to make the product a little bit better before I really do a big marketing push. I do want like I am still doing the marketing study. But I have not spent any time on my marketing site. Because I've just been trying to get these features out. I also spoke with -- another interview I did was with a front-end developer and he was pretty jazzed about it because you don't have to do any background configuration. So as a front end developer, he can completely allow his users to upload files and access those files, and he doesn't have to do anything on the back end. So it made me think if I'm going to niche this down further, which I might, I might do, like the front-end developer community, might be where I want to be.Michele Hansen 9:19 I'm really excited to hear that you are enjoying these conversations. I think a lot of people have fear around talking to customers, whether that's a fear that they're going to say something negative about your product, or simply fear that you're not going to know what to say to them and it's going to be awkward and so it's it's really encouraging to hear that you're enjoying it and I'm curious if you can like talk more about how you have approached those conversations.Colleen Schnettler 9:49 Okay, so the first thing I have to say is of all the people I've talked to only one person has been excited about it. Everyone else is kind of like pointing out stuff but it hasn't been all positive feedback. But the people who are pointing up stuff are trying to help. They're not you know, they're not being jerks.Michele Hansen 10:06 It's helpful. Like, I mean, if you talk to someone, and they're like, they say everything is amazing and perfect, and then they don't actually give you anything to work on. It's kind of like, well, that made me feel good, but didn't really help me do anything. But I mean, it sounds like you're getting a lot of productive feedback out of these conversations.Colleen Schnettler 10:25 I totally am, I totally AM. And yeah, but it has been like, not exactly affirming. And to your point, I think we talked about this weeks ago, you don't want your customers to just tell you everything's perfect unless it really is. And where I am, it's definitely not perfect. So I have really appreciated everyone giving me like really honest feedback, I've tried to approach these conversations, kind of, like I think I talked about last week, it's nice to have a starting point, like I've been able to reach a lot more people, because now I have something very specific, I'm trying to share with them. Whereas in the idea generation phase, you don't even have, when you're just trying to come up with ideas, the customer interviews are really hard at that point. Because you don't even have a process identified that you're trying to solve. So you're trying to walk these people through their day, and, and hone in on a process that they might not even know they're struggling with. And that's, that's nearly impossible is what I found. Whereas now that I actually have a product, and I'm looking at this very specific thing, people have been much more generous with their time, and much more generous with their feedback, telling me about what they do, what they have done what they want. And so I really think that's, that's helping my customer interview skills. That being said, I get really excited, like, you know that maybe listeners of the podcast have noticed that sometimes I'm literally like sitting on my hands, so I don't interrupt someone with my excitement. So I don't know why that works. But I'm like, Colleen, just be quiet, let them talk, let them talk, let them talk. So sometimes that's what's going on in my head. So for me, tempering my excitement, and my desire to agree with them, has been a little challenging.Michele Hansen 12:19 That totally makes sense. And, you know, when I'm coaching people, and I'm doing interviews, that's always one of the things that comes up so common is that if somebody says something, whether you agree with it or disagree with it, you can't jump in and share your own perspective, because in order to get someone to be as open with you as possible, you need to hold back all of your thoughts about what they're saying, both enthusiastic ones and disagreement. And I find that one of the hardest things for founders, when they're doing interviews, is when somebody says something is broken, or that it doesn't work, right, or that they expected it to work a different way, to be able to say, "Oh, that's interesting. Can you tell me how you expected it to work?" Rather than saying, "Well, the reason why is I built it like this, and I did that, and then I couldn't do it this way. And then, and then eventually, that's how we got around to this way." But really avoiding doing that second part. And so I'm curious if you have found yourself falling into that when people people are pointing things out.Colleen Schnettler 13:27 So I tend to agree, but I think I agree a little too enthusiastically. For example, if you said to me, wow, Colleen, this is cool. But I really need it to have this styling. I'm someone who's gonna be like, yes, that's a great idea. Like, literally, that's how excited I will be on the call with you. Like I'm like, Yes, that's a great idea. And then you have the you know, these people have never met me in real life. They have like, no context for me, I probably terrified them. They're probably like, Okay, calm down. So I think that I tend to get really excited. And I tend to agree. So far, everything people have said to me is really good. And they're right. And it was actually affirming something I had already kind of knew was a thing. But in the in the effort to actually ship as we've discussed, I didn't implement all these other features. So So my challenge, so yes, I'm falling into that trap of like being overly agreeing. And so my challenge and what I'm trying to work on in future customer interviews is to listen and take in their feedback, but go one step more. So let's say for example, someone said to me, "Hey, this is great. I am a designer, I need to upload these huge super huge files, because we need these files to be you know, five gigs. They weren't five, they were like two gigs. They're huge files." And so I my recent That was like, Yes, you That's exactly what I was thinking of when I built this. It's for people like you who need these huge files. And what maybe I could have done better would have been to get some more context, I could have been like, okay, I forgot to ask him what he's doing now. Like, that's kind of critical. So I didn't ask him what he's doing. Now, I didn't ask him what, you know, impediments he has for what he's doing now. But contrast that with another person I have talked to, and this other person wants something totally different. He is like, I'm using these for images. So I want to be able to resize and crop and use all the image magic stuff on these images. And when he was saying that, I thought, Yeah, that would be great if I if I did that. But these two things are directly in conflict, right? I can't pre pre optimize your images and give you full image sizes. I mean, you wouldn't if you don't, you know, these two people wanted different things. And so, but I loved both of their ideas. So I don't know if I made any progress there.Michele Hansen 16:05 I think you did, because you identified some things that you might do differently in future interviews. And it stuck out to me that you said that when you're responding to what someone said, and you responded with all this enthusiasm for them. You did not dig deeper into their process. And until you just told me about those two different types of feedback, what what I didn't hear was, Why do they need that in the first place? What is their broader goal they're trying to accomplish? What is the process? What kind of context is this in? are they building client websites? Or they're building somebody else's websites? Like what kind of websites are they like, like, really, really digging more into what it is they are doing? And it strikes me there's a, I have a favorite book about interviewing one I've several books about here. But one in particular, I don't know if I've ever recommended to you is called Practical Empathy by Indi Young, I've ever recommended that to you.Colleen Schnettler 17:05 I don't think so.Michele Hansen 17:05 It's as much as a book about how to interview people and how to pull these things out of them. But it's also very useful for being in meetings or talking to friends or family in general of really trying to understand what someone is saying what they're experiencing and putting yourself in your shoes. To understand how the world looks from their perspective. It's such a good book, I just reread it last summer. And I found myself just constantly underlining and and nodding as I was reading it, and just, you know, one of those books you read? And you're like, yes, yes. Like, I agree with everything she's saying. Such a good book. It's, I think it would be amazing if you know, every founder read that, read that book, read Practical Empathy. It just gives you tools to conduct interviews, and meetings and everything else sort of in general, in a way that really helps you understand why people are asking for things and how to figure out what that context is that drives them to have these feature requests. So then you can understand how those things fit together and how to prioritize them.Colleen Schnettler 18:14 Well, that sounds like a wonderful book. And I think I'm getting to the end of StoryBrand. So I think maybe that will be my next book that I read and share about on the podcast.Michele Hansen 18:24 Do we want to do a little bit of story brand, then?Colleen Schnettler 18:27 Sure. Let's let's jump into this week. So I am on the chapter after calls to action. And this chapter is that helps them avoid failure. And the principal, each chapter has this principle that the StoryBrand author's trying to get across is that every human being is trying to avoid a tragic ending. The kind of the the way this is framed in a marketing context is he talks about, you need to identify what the customer will lose if they don't buy your product. If there are no stakes, there is no story. People are motivated to loss aversion. Emphasizing potential loss is more than just good storytelling. It's good behavioral economics. So then he talks about this study that identified this thing called Prospect Theory. Have you ever heard of this?Michele Hansen 19:18 Yes, I'm, I'm like, I'm sitting here trying not to bubble over with excitement. I'm just like you were talking about with your interviews because I'm a like, I'm a huge fan of behavioral economics and like, and I'm like, Oh my god, Is he good? Is Is he gonna talk talk about Daniel Kahneman and Amos Tversky. Like, yeah,Colleen Schnettler 19:36 Yes! That's exactly. That's exactly what he talks about.Michele Hansen 19:39 Is it the study where it's like, would you rather have a 50% chance of losing $100 or a 50% chance of winning $1,000 or no, not losing? $100? Right. And then we'll pick not losing $100 doesn't exactly what he talks about. Behavioal Economics. Amazing. Okay. Yes. Okay. So how does it talk about what does it mean in a Storybrand context?Colleen Schnettler 19:58 Okay, so this is all new to me. Unlike Michele, I don't study behavioral economics in my free time. But that's cool that you do. So this theory exactly, by the author Michelle was just talking about, it's called Prospect Theory. And it argues that people are more likely to be dissatisfied with a loss than they are satisfied with a game. So people hate losing $100 more than they like winning $100. So loss aversion is a that's so wild, by the way, I've just never thought about it before. It's not something I've ever considered.Michele Hansen 20:33 You know, actually, this came up for us this week, because and actually, so I wrote a little like, a blog post about this a couple of years ago, on this on this topic, so we have people like signing up for our site, and we have a free tier.Colleen Schnettler 20:49 Yeah, andMichele Hansen 20:50 and we will occasionally see like people creating multiple accounts and abusing the free tier. And so for a period of time to prevent this, we had everybody had to verify their email before they could process a file. But then that, first of all, it can credibly, like decrease conversions and made things more complicated for for legitimate users. Actually, I think what it did was like there was like a maximum of like five accounts per IP address, and then it had to be manually overwritten. So how it worked with a signup a couple of years ago was that in order to to prevent all of these sort of abusive signups, we would have a limit of five accounts per IP address. And then if they needed more than that, then there was a manual override we had to do. But the problem was is like people would be like in a class, for example, like so the Red Cross uses us in their disaster relief trainings, or a lot of professors use us in their GIS classes. And so then they would be like, oh, we're getting blocked from signing up. And so we would have to go in and like try to do this. And like it was actually hurting these legitimate users or people we wanted signing up. And so we realized we were spending more time thinking about how to prevent these abusive signups then we were on like, growth and like new customer acquisition, and but really like, because it hurts, like what people are abusing a free tier in this very visceral way. And we just saw this again, in the past week to where last week we had someone create, like 75 accounts all within the same day. But then we looked at like, okay, where are they doing it automated, like, I like, how is it happening? And this person was like, literally, like manually going in and creating these accounts every five minutes. And I was like, well, they spent like, a solid 15 hours doing this, and their time is not valuable enough to pay us the $25, it would have been like, should we really go in right now and spend hours of work on trying to prevent this from happening when this person wouldn't even have paid us in the first place. Though, actually, then a day later, it turns out, we do have to prioritize this work, because this person was using fake email accounts, and they were doing it over several days. And we're sending a welcome email, we're going well, in this episode, we're sending a welcome email to all of those fake email accounts, and it caused our bounce rate to go way up. So then we got a warning from intercom saying, you know, your bounce rate is really high, and you need to get it down. Otherwise, you might get shut off from email. So now we actually have to prioritize this work. But like, that's something that that loss aversion principle is something that we talk about, often, when it comes to free tier users, and like, how aggressive do we want to be in preventing someone from getting $5 $25 worth of free usage, versus spending those, you know, five, six hours of time it would take to work on that for something that could get us 1000s of dollars in new customers? It's an easy trap to fall into. And, and I think knowing about that study is so helpful because I can see that pattern of because it's a natural pattern of thinking, you know, you're perfectly normal for for thinking that way. And so, so recognizing that pattern, and then not falling into it. It's it's hard, but it's necessary.Colleen Schnettler 24:18 Yeah, I was fascinated because I have like I said, I had not been introduced to this idea before. So I thought it was really interesting. So the author of the book talks about creating a four step process which he calls a fear appeal. Now, to his credit, he does talk earlier in the chapter about how you don't want to fear monger, you're not trying to terrify or create a false sense of fear. You're just trying to show your potential customer what they're going to lose if they choose not to go with you. So the four step process is one make the reader know they are vulnerable to a threat. Two, since they are vulnerable, they should take action to reduce their vulnerability. Three, let them know about a specific call to action that protects them from risk. And four challenge them to take this specific action. And he doesn't I mean, he says, again, not a lot of fear, just a quote, pinch of salt was the way he described it. So you need to look at what are you helping your customers avoid? So my list that I made, what am I helping my customers avoid? So what is the opportunity cost of not working with me? For what I have built, I think it's a tremendous amount of time wasted. You won't lose your files because I have backup storage, when most people create their AWS accounts in their s3 buckets, they don't create a backup service, you won't lose users because of your crappy interface. And that's all I got.Michele Hansen 25:52 I think that time one is a big one.Colleen Schnettler 25:54 I still think the time when is a big one, I should add something about the direct uploads because my files don't touch your server. Because you know, sometimes, if you don't use direct uploads, you go from the the browser to your server, your server to your cloud storage provider, and I go right to your cloud storage provider. So not having to write that architecture is again, though, really, that's a time thing. Really, that's just going back to ease of use. Michele Hansen 26:19 Yeah, I think time saving is your big loss that people might experience if they don't use your service.Colleen Schnettler 26:26 Yeah, I agree. I think I think time saving as well. So that was that chapter. That's what I read this week.Michele Hansen 26:32 Well, I guess that's a good time for us to end this week. Thanks so much for listening. We'll talk to you again next week.
When Competitors Are Nipping At Your Heels
Michele Hansen 0:00 So we had kind of a wake up call this week.Colleen Schnettler 0:04 Oh, what happened?Michele Hansen 0:07 So we're looking at some of our competitors websites, and we realize either their employees don't have kids, or they don't care that their employees have kids or what, but they have gotten a lot more done this year than we have.Colleen Schnettler 0:24 Oh, okay. Michele Hansen 0:26 I mean, we feel good about what we've gotten done considering everything. But it was definitely kind of a moment of, whoa, okay. Like, you know, should you know, we have this information now, like, should we do something with this knowing that some competitors are nipping at our heels a little closer than they were a year ago?Colleen Schnettler 0:47 So what does it mean for them to be nipping at your heels? Are they releasing new features? Are they like, what exactly did you see that made you go, Oh, we need to up our game.Michele Hansen 0:58 So it's, it's partly new features, I think it's one of the most visible things, there's also some administrative type features, like, you know, certain compliance, and certifications. And you know, it with this kind of thing, though, you know, you have that first moment, it's like, oh, like, they now support something that they didn't before that we do. And so that makes us tighter competitors. But also remembering that we compete on so many different levels. And like, we have no one true one to one competitor, um, which, which I think is good for us. And it was, the other thing is like, we don't really pay much attention to our competitors, which I think is somewhat unique. Um, you know, I get the sense that that most companies, if you ask them to how they divide their mental headspace, and research time, and all of that between their competitors and their customers, I'm gonna bet that most companies are somewhere around at 20 in favor of looking at what their competitors are doing, what their features are, what their pricing is, you know, what their marketing is, like, all those kinds of things. And then 20% on the customers, and even like, really great companies that are known for focusing on their customers, which most truly great companies are, are probably more like 5050. And I think we're more like 9010 in favor of listening to our customers and letting them guide our roadmap. And then it's really maybe only once or twice a year that we really check in on what our competitors are doing.Colleen Schnettler 2:46 Okay, so you were checking out some of your competitor sites? And like, what's your reaction? Are you concerned? Are you worried, you're gonna start? Are you seeing, are you seeing higher customer churn? Because people are going to your competitors for these additional features?Michele Hansen 3:01 No, that's the thing. And our growth is, you know, perfectly healthy, it's, you know, beyond a level that that we, you know, sort of, quote, unquote, need. And so all of that is healthy, and we're really busy. So we're not worried about it. And I think that's what I have been thinking a lot about is okay, you know, we have this moment of we have this new information. And whenever we get new information, there is there's the question of, what do we do with this information? And the answer to that question can be nothing, we don't do anything different. Which I think is an under appreciated answer. In business many times, and old boss of mine was sort of famous for, you know, his do nothing approach. Because, you know, we're not going to sort of run around like chickens with our heads cut off to launch a new feature. When, you know, it turns out that oh, well, the competitors pricing model is actually not as customer friendly as ours, and based on some other things are, it's very clear, they're going after a different market segment than we are. And maybe there's a small percentage of customers that view us as a one to one comparison, but it's really very few customers who do, but it's a tricky thing, right?Colleen Schnettler 4:34 Yeah, I can definitely see that. So I was talking to a friend the other day about his last SaaS, which did really well, he grew it and he sold it for a good chunk of money. But he was talking about like the emotional upheaval every time a competitor launched. And I thought that was really interesting, because that's got to be like, you don't know what to do. Should you implement these features like there's got to be a lot of tension there in terms of how you approach this kind of new information you have?Michele Hansen 5:02 Yeah, and and what I tend to think about is, when I get those feelings, I pull it back to Okay, what what are the dimensions that we are truly competing on? And how many of those have really changed, and how many of those are present in this competitor, and how easy is it for this competitor, to replicate our model, because that's what makes a business unique is it you know, all the different things that go into it that make certain you know, price points possible for some companies that aren't possible for other ones, for example, you know, so we, we not only compete on the price itself, we also compete on the pricing model. So we have free tier daily free tier plus pays, you go plus subscription options. And then you know, all sorts of other more custom options after that. You know, some of our competitors are, for example, one of the major ones, they have a free tier per month, but you have to have a credit card on file. Some of them are much lower free tier per month, some of them have a free tier per day, but it's only for a three month period, like there's all and then like some of them have pays, you go on top of that some as we were talking about with you a couple of weeks ago, some of them maybe have paid you go on top of that, or they have subscriptions within a certain band on top of that, or they jump straight to enterprise after that. Um, and so the price and the pricing model are one way we can eat, then, of course, there's the the data itself, like so in our space, it's the coverage, you know, where US and Canada and some of our competitors are us only some of them are worldwide, but not at rooftop level. Some of them are rooftop, like some places rooftop some places not like all sorts of different things. And then also the different data appends that we have. So adding congressional districts, adding census data, all that kind of stuff, which most of our competitors don't have, only one has a couple of those things. So there's the data and the coverage. There's also things like the features. So we have an API, we also have the ability to upload spreadsheets, like massive spreadsheets, most of our competitors don't have spreadsheet upload support, most of them don't have batch geocoding support. And some of them actually expressly prohibit batch geocoding. Only one of them has some sort of spreadsheet support, but it's actually like copy paste, and it's very limited. And then there's also Terms of Service, which is probably the hardest one for anyone to replicate, which is our extremely permissive Terms of Use. And most of our competitors have very restrictive Terms of Use, and you know, you can't store the data, you can't reuse it, things like that. And so when we have a, you know, a new competitor Come on, or a new a competitor, add, you know, features or things like that, we're always thinking, Okay, like, how does this? Yes, there's that initial feeling of like, oh, oh, like, okay. But then what does that actually mean for us? And how does that change our competitive position? And usually, it's, you know, what, this, there's more competition, that's fine. We're still okay, we're still going to keep focusing on what we do.Colleen Schnettler 8:19 So you're looking for like specific data points, like you would be maybe concerned if a customer changed to a similar pricing model, or if they decided to let you cache your data or let you keep your data. So you're looking for things like that are more specifically competing in your competitive advantage? Exactly.Michele Hansen 8:39 Yes. And especially the combination of all of those things, too, which is something that thankfully, none of our competitors have, at this point. And, and the thing about competitive advantage, even in a commodity space, is that we still have some advantages, like we have seven years now of working with this data, and have happy customers who are willing to vouch for us who who talk to other people about us, like, those are advantages we didn't have at the beginning. And now our data is much, much better, the user experience of those features is much, much better, which in a commodity space. You know, you only have so many levers to pull prices, the most obvious one, but user experience is a big one too, because if you can make it easier for someone, and it's the same price as something else, they're going to use the one that's easier to use. And so we have years under our belt of making those things easier, for example, some of our competitors, like maybe they have international data, or they do have rooftop data or whatever that is, but you have to hit multiple API's to do that. And so that's an infrastructure decision that has informed a competitive advantage for us because it's easier to use our API because you only have to make one request and then you get everything back all at once. And so there's a lot have like strategic level decisions like that. That may just seem like an engineering decision or a legal department decision with Terms of Service, for example, that I think really do change, competitive positioning and competitive advantages.Colleen Schnettler 10:20 So part of this makes me think about something we've discussed before. And it's just as this decision on how and when to add new features. Do you guys use a product to help you with that? Or do you have a product roadmap, you guys review every six months? Like kind of, besides looking at, you know, where you're competing? specifically? How do you handle new features.Michele Hansen 10:43 So we do not have a product roadmap, I think that was something that we honestly, were kind of excited to liberate ourselves from when we went full time on this, because you know, we don't have a board of directors to report to we don't have other departments that need to coordinate, we don't need leadership that's on board. Like, because we are the leadership, we're also the operators, you were the investor, like we're everything. And so we don't have a roadmap, which is, just makes it really simple with the two of us, because we're always, we're always learning together. And so if something starts to shift that like, oh, like we should, maybe we should add this particular data append, or maybe we need to rethink the user experience of a particular part of our service. Both of us are kind of evolving at the same time. It's pretty rare for us to be in a situation where one of us thinks one thing is really important, and the other one thinks something else's, is really important. I think that's really where working respect for your co founder is really important. We do though, generally, like we'll talk maybe over the next three months. And how we tend to work especially when it comes to new features, is we will do sort of sprints and rest periods. So fours, everybody knows the term Sprint's from agile and all of that, and this term drives me nuts. Because anyone who has ever run knows that you do not sprint constantly, you can't sprint for two weeks, and then sprint two weeks sprint for two weeks that you're going to be exhausted, you live your body physically cannot do it. And so what we will tend to do is we will sprint on a particular feature, or something that we're trying to improve or trying to do. And then we purposely have a rest period, we might take a couple of weeks where we're just doing maintenance work, you know, we're doing all the other things that go into running the business. But we're not doing that energy of new creation, which is kind of exhausting and like requires a lot of mental energy to work through. Okay, well, what if, in this scenario, what happens there? And that way this could go wrong? How do we handle these three, you know, cases that come out of that, like all of that sort of thinking is very resource intensive, from a mental perspective. And, and so we purposefully will sprint for a period of time, and then have a period where we're, you know, fixing bugs and doing accounting things, and then and other things like that. But we usually don't plan more than maybe two months in advance, like what we'll have a general idea of what we're going to be working on over the next couple of months. We are rarely in scenarios where we have a specific deadline for something, especially for a feature like I can only think of one time in the past two years that there was a customer that was coming on board. And there was a particular feature that was a requirement for them to start. And we you know, we gave them a timeframe for that. And we basically had a due date for it. But pretty much all of our due dates are always self directed.Colleen Schnettler 14:02 Very cool. It sounds like a great way to run a business. I mean, it sounds like you guys have a good a good balance there. And you're far enough along that every time a competitor launches, you know, a new feature. It's not like oh my gosh, we're gonna go out of business. Like it sounds like you're in a pretty comfortable position.Michele Hansen 14:18 It definitely was like that. In the beginning, though. Um, you know, we have to close our eye on things. And yeah, I remember we had there was somebody who launched something similar for Australia, and they like copied our entire website. And our price like they copied literally everything about us. We had another competitor who copied our tagline and I think they might even still have it. Who knows, they might even be listening. Um, if they pay attention to competitors, like most companies do, they probably think this podcast is a great source of competitive intelligence and corporate espionage.Colleen Schnettler 14:59 I love it. You said corporate espionage but so fancy,Michele Hansen 15:05 I don't, I tend to be more relaxed about this stuff, you know, we like we see the competitors Come on, we see them do things. And I think, as a business because we are so in touch with our customers, and because it's so important to us, and because we know we're doing the things that are important to them, I think as a business, we tend to have a certain amount of quiet self confidence, we don't feel the need to be looking over our shoulder, you know, wondering if our customers are going to go to the new hot thing and leave us behind like we, we know them, they know us. And, and we listen to them. And, and so far, that seems to be working. Now, there's no guarantees that that will continue to work. And there could be some, you know, crazy funded company that's going to completely come in washes away, that certainly happens all the time, especially to small companies, having a big well financed competitor come in. So that's something that could happen in the future. But for the time being, you know, we're gonna keep doing what we're doing.Colleen Schnettler 16:11 Awesome.Michele Hansen 16:12 So what's up with you?Colleen Schnettler 16:13 So I have been working, I've been busy working on all the things, it's still a lot of fun. It's nice, even now past the idea generation stage and having actually shipped something. It's nice to know what to do next. Like I have a lot of things to do. But I know what to do next. And you know, that kind of feels good after floundering for so long with like, oh, what about this? What do I do now? What do I do now. So customer levels about the same as it was last week, 30 ish people signed up, I think I've 10 that are actively using it. But the great thing is, because I've been able to talk to some of the 10 people, I have seen some issues with the product that I really want to address have already addressed, you know, by this week, and the first one was deleting and that I already told you about. So I did that. The second one was customizing the widget. So it looks great on my site, because the branding is obviously designed to match my site. And so someone sent me his production site where he's using it, and he has like this dark theme, and it looks terrible. White, I know, I was like, let me fix that for you immediately. So it's cool. So I added a section now where as the implementing developer, you can now set your all your different colors, you can upload your own icon, you can completely customize it to match your site branding. So I was pretty excited about that. Especially since you know, that's an immediate like gratification thing for people who are using it. I'm also I have it running on two of my client sites now. And I'm seeing some issues with like the ease of implementation, like that's my big tagline, right is that like, it's easy. And I'm seeing that there are some things you may want to do that are, you have to have like a deeper level of JavaScript for. And so I want to kind of, I think not everyone's gonna want to do it. Basically, for example, let's say you're using it for your avatar and your avatars uploading photos, what would happen is because the drop zone doesn't have a memory, per se, if you render the form, but it's an edit form, instead of a new form, the previous image is not going to be on the form, you as the developer have to write the image tag to put the previous image in the image tag. And then the drop zone would be wherever you put it on the page. But that's kind of that's, that feels kind of clunky, right? Because you have your image, and then you have a drop zone below it. So just things like having it pop up, when you click a button and having it hidden. You know, I'm just working through some of the UI stuff. And I'm trying to give people options. So yes, it takes five minutes to implement it. If you also want it to pop up here and do this and do that. Here's a snippet you can use to make that happen. So I'm kind of trying to work through some of those kinks. Michele Hansen 19:23 I mean, the great thing about having early users, even though it's not a lot is like I can see how people are using it and you can get which is so bad from people not only as Hey, like can you do this but do what you're talking about with a dark mode like the the feedback of oh my gosh, this is amazing. Like thank you so much you fixed it like that is some of the most powerful motivation and like, like affirmation that you're working on the right thing, which, you know, said for so long, you felt like you were kind of floundering looking for something to work on and didn't have that that kind of direction. And we're really just trying to find something and now to be in a place Where you have people using it, and you're using it yourself, and you're seeing these issues and you know, on the one hand, it can be a little bit overwhelming to be like, Oh my God, this product has such a long way to go. But also you get those little moments of Oh, wow, you fixed it. Thank you so much like, just hearing someone appreciate you is, I find that to be so motivating.Colleen Schnettler 20:25 Yeah, it's been really cool. And I've noticed too, like in the beginning, you know, you and I've been friends for years and have been doing these coffee chats pre podcast for years. So you remember me just desperately trying to find an idea. And I would interview people. But I have found that now that I actually have something, people are much more open to talking to me about it. So I have like, I've had a couple calls this week, I have calls with friends. They were just friends that are developers, but I can be like, here is this thing. What do you think? How does it integrate with your production applications. And I feel like I'm getting a lot of really good feedback from from that. So it's actually really nice to go back through with follow up with people I've talked to before and been like, Oh, so I built this thing. And you can get really specific feedback, which I think is cool. And so that's been, that's been a lot of fun. So I've been doing like a lot of calls and just talking and talking and talking to people about what they need. And about the feature thing too. At first, when this guy sent me his site, and I saw this white drop zone on his blue background, I was like, Oh my gosh, I am so embarrassed that I shipped a product that you can't change the color of. But then the more I thought about it, I was like, I just really needed to ship something and it works. You know, I didn't ship a piece of crap. Like it works, it does exactly what it says it will do. So I'm really glad you pushed me to ship it, even though it didn't have some like things that are really nice to have. Because once it was shipped, like once it's out there, the hardest part was all the AWS architecture, right? This stuff is easy, like this stuff I can do in a day. And so I'm really glad, like, that's all that would be my you know, if you're in that early stages of a product, and you have one that works, but it's not perfect shipping anyway. Because then to your point, you'll hear from people, you'll see what people want, and you'll be able to, you know, riff on that.Michele Hansen 22:18 And I feel like, what I hear you saying is how, you know, you said you, you were you felt like you were floundering for a long time. And it was hard to get people to talk to you about that. And you didn't say this, but it but it sounds like that was kind of a lonely process. And now that you have someone, something out there, you have all these people to talk to you and they're excited about it. They want to give you feedback. And yes, there's like some embarrassment that like oh my god, like, like, you can't do the background. Oh, this is terrible. Like, we definitely had those feelings of like, Oh, my God, our product is terrible. Why would anyone use it? Um, and like, but you have connection now with other people. And so you went from this kind of lonely place to one where you do have conversations and people want to talk to you because there's like something tangible that you can talk about with them. And so I think your story is, you know, so inspiring for people who, who may still be in that looking for a problem looking for something to build phase because it's okay, if you're feeling kind of alone in that stage. Like, that's, that's perfectly normal. I think your story of just, you know, building the thing you needed, even if it's not the most exciting thing in the world, it's not going to be the next Uber, like it solves your problem, and you're happy with it. Um, and yes, there's a little bit of embarrassment about features of it when you when you launch, but you got something out there, and now you're you collaborating with people on it like you can get there.Colleen Schnettler 23:56 Yes, yes, you're absolutely right. And you know, I was thinking about this. So I told you, part of the reason, like I listened to a lot of podcasts, and I listened to a lot of these two founders starting a business podcast. And so I've been listening to them a little more closely. And it occurred to me, that of the four I listened to, not a single founder is on his first company. Oh, like they've all started something before. Yeah. Well, I mean, whether it's been like an info product, or they haven't all started, like super successful sasses. But like a couple of them have sold, they've all sold something outside of their consulting before. So I think also, I think part of my part of the thing that is lonely and can feel really frustrating when you're trying to get started is I'm listening to these guys on their podcast. And they'll just like casually mention, the other company they sold, or they'll casually mentioned, they're backed by tiny seed. And I'm like, well, we were backup like, what about us that are just starting from the beginning. So yeah, so that's just like my little pep talk if you're just starting from the beginning. So am I And, and it is lonely in the beginning, especially since you're so like, you're so directionless. Right. So like you said, Now I have a direction. This might, as we said, I don't, I don't really know where it's going. But now I can talk to people and I collaborate with people. And I can really find out the pain frequency of this problem, which is something we have discussed before, too.Michele Hansen 25:22 It sounds like you're in a good place right now.Colleen Schnettler 25:25 I am like, this part is so fun. Another thing I've been thinking of is like, as we've discussed before, as well, this is like what I want to do, right like this is this is the path I want to go on. So I've tried to kind of implement strategies to not work myself to death ever thinking, I'm just going to be, you know, once I, because I used to think like, Oh, I just launched something like everything will be perfect. I think Amy has a great article about this, too. Like, if I just make my first sale, like everything will be perfect like this is I want this to be my job. Like I want this to be, you know, something that weaves itself into my life in a really manageable way. And so, you know, this is a really fun time right now. So I'm just trying to enjoy it.Michele Hansen 26:07 I'm so happy to see you in a good place like, new, as you mentioned, like we've been having these conversations for years now. And it's just so gratifying for me to see you so like happy and bubbly and full of tasks and things and directions. And like you're on the path, you may have just gotten your foot on it, but you are on like we have gotten you to the trail, you are no longer wandering through the woods like there, there will be rivers, there will be cliffs like this trail is not going to be just a walk in the park. But we found the trail. And that is such a huge part of the journey. And I'm just so happy to see you at this place now. Like it's so gratifying for me.Colleen Schnettler 26:55 It's awesome. It makes me happy too. And thank you so much, you're the best. So Oh, and so really this upcoming week, I need to work on my marketing page. It's funny how like, I just have been really slow to get that done. It's not that it's particularly hard. I just have to do it. So I need to I need to fix up my marketing page. And like, just keep talking to people and just keep iterating and reaching out to folks. Yeah, so so that's kind of where I am.Michele Hansen 27:27 So are you reading Storybrand?Colleen Schnettler 27:29 I am. And so this week's chapter was actually so it felt so obvious. Like I almost didn't want to share it this this week's chapter was not a big like, Oh, it was a call to action. And it's basically like, don't forget to tell people that what you want them to do. But that was the whole chapter, like don't like call to action like they need to you so you do all this work to you know, get them to trust you and establish yourself as an expert and an authority in the field, you understand them you understand their problem. Now you have to tell them what to do. And so you have to call them to action. Oh, yeah,Michele Hansen 28:05 I remember what I was reading this chapter. And I also thought that it was something that was so obvious. And then I looked at our website, and I was like, wow, we actually haven't done this. Like there are a lot of places where it said, you know, it said sign up when really the action was upload a file or create an API key or, like, not just telling them do something but do this specific thing.Colleen Schnettler 28:27 That will wrap up this week's episode of the software social podcast, we'd love to hear from you at on the Twitter on Twitter, at software slash pod
Workshopping User Onboarding Problems
VOTE FOR US! SaaSPodcastAwards.comColleen's Heroku landing page: https://elements.heroku.com/addons/simple-file-uploadMichele Hansen 0:00 So I got a pretty exciting email yesterday. We were nominated for the MicroConf SaaS Podcast Awards!Colleen Schnettler 0:09 That's amazing. Michele Hansen 0:10 In three categories.Colleen Schnettler 0:13 Wow, that's so funny, Michele, because when we started this podcast, I was pretty sure no one was gonna listen to it except for me. So I can't believe like people listen to it. I feel like a little uncomfortable that people listen to it actually. Michele Hansen 0:30 Yeah, we kind of expected it would just be like our husbands and some close business friends of ours. I'm totally floored and surprised and so honored that people are listening, and you guys nominated us and really, really, genuinely touched by that. So it's kind of a fun thing that's going on. But there are also other fun things going on. With Colleen, because you're now in you know, the Heroku marketplace. There's people using it. And I think I saw you mentioned this week that you even got feedback from like somebody you don't know using it and they have something positive to say?!Colleen Schnettler 1:13 It's not my friend. Actually.Michele Hansen 1:16 that's always awesome.Michele Hansen 1:19 A total stranger using your thing. That's a milestone. Colleen Schnettler 1:20 That's a milestone. So I feel like this is just a really exciting time in terms of launching a product. So the product has been in beta, I think for about seven to 10 days. And as of this morning, 31 teams have signed up,Michele Hansen 1:38 Dude! Colleen SchnettlerYeah, but...Michele HansenYou're a third of the way there!Colleen Schnettler 1:41 Well, 31 teams have signed up, but they're not all right, that's true for the I have to get 100 like I'm a third of the way there. But what is interesting about this is the way the Heroku cycle works. So if you are in the Heroku marketplace, you're going to search for I don't know file upload, you see my you see my add on, you click a button to install it. Then, if you want your personalized instructions, you have to go to the dashboard for your application, and click on it again, in your application. And that's the single sign on. So they provision the application which they can use it without ever doing single sign on. But most people use single sign on because then the directions are personalized with their API key. So of those 31 people 13 have actually made it to single sign on. And of those 13. Six have actively uploaded files. So for like a week, I'm feeling really good about these numbers.Michele Hansen 2:42 Yeah,Colleen Schnettler 2:44 I think there's just a huge benefit to being in like using this marketplaces attraction channel, I think that is just been a huge benefit. Because I know so many people who have launched products, and they literally cannot get anyone to sign up. And that would be that would be tough. So basically, what I'm doing is I don't get a contact email until they hit single sign on. Now there's one team that never single signed on. And they're just using the documentation from the Heroku. Doc's so good for them. So I don't have contact information for them. But the other 13 I do have contact information for so I have hand emailed all 13 of those contacts of the 13. I emailed three have emailed me back. So that's pretty good. Not bad, right? I don't know. Like I myself tend to ignore emails. SoMichele Hansen 3:37 Like my feedback emails, I think the highest I've ever gotten the open rate to know the open rate is like something like 60%. But the reply rate is usually in the eight to 10% range. So that is good.Colleen Schnettler 3:51 Yeah. And I was just kind of asking, like, I just have an email. It's like, hey, do you need help setting it up? Let me know. So that's like, a really exciting first week. I mean, I feel like things are are going well, I've been hustling. Hold on. Wait,Michele Hansen 4:05 tell us what they said though. Like, don't skip that. I want to hear what these people had to say about it.Colleen Schnettler 4:12 So the first person had a feature request, which is like a totally reasonable request. The second person had the same feature request. And the third person. Yeah, I mean, it's okay. It's embarrassing. I shifted. Okay, now I have to tell you, so I shipped a file storage solution without giving you the ability to delete files.Michele Hansen 4:34 I mean, everything is a feature. Like we shipped a product without the ability to charge peopleColleen Schnettler 4:40 It seemed like like, everything is a feature. I'm not charging them. So you know, it's not like they're paying for it. If I was asking them to pay for it, then yeah, I would have let them I would have shipped it with the ability to delete. But since I'm not charging them it doesn't matter.Michele Hansen 4:57 But when really get feature requests, like explicit feature requests for something specific, are our processes always, you know, whatever it is we always capture it. And so how this works for us is we just create an issue and GitHub related to intercom, it's not the cleanest way to do it, but it works for us. And then if somebody else or like multiple people ask us for it, then we look into it. So it's pretty interesting that you've already had two people asked for the same thing. Now granted, as you say, it's a fairly table stakes kind of thing. But it's, it's always interesting when you have multiple people asking for something, because that is pretty clearly indicates interest.Colleen Schnettler 5:38 Yeah, so I'm obviously gonna add that. I mean, I didn't add it for a very specific reason. And the reason I didn't add it is because I'm concerned, like if a user drops up, if a user adds a file, like let's say they add their avatar, and then they add, drop it again. Now, I don't know, why would they would do that. But let's say they do. So let's say they drop the same file twice, that actually gets saved in my service as two different files, because I have no way to know that that's the same file, because the font because I don't want to overwrite file names, right? Because your file might name might be avatar, and mine might be avatar, so I'm not overwriting files. And so if that happened, the developer who's implementing it is going to be saving the most recent URL in their database, so they can access that file in the cloud. If they then go into their admin dashboard, and they see two of the same files, and they delete one, and they delete the one they have linked in their database, then they're no longer going to have access to that file. Does that make any sense? I feel like I need to like whiteboard that. But basically, there's a way where if two of the same, same images get uploaded, but the URLs are different. And they have one database URL, one URL in their database pointing to the file and they delete the wrong file, that file will then be gone.Michele Hansen 7:05 So you're trying to make it sort of human error? Yes, fault tolerant, right? Yeah, they would have, like a timestamp or something to help them differentiate between them, like someone who has, you know, a scren shot saved at 10 1530 2am versus 10 1530 5am.Colleen Schnettler 7:27 That's actually a great idea. So there's a couple ways I can implement deletion. Or every time the user drops a file, I can just overwrite the previous file. I didn't do that, because I want to give myself the ability to expand to adding multiple files. But I like the timestamp idea that could just be like, here are the same files have the same file name? And here's the most recently updated one. So if you want to delete one, delete the old ones, yeah, I'm just worried that's a mistake, or like an operating system would add 123? Michele Hansen 7:52 You know, yeah...Colleen Schnettler 7:56 I checked the problem is, yeah, I mean, there's ways I can do it, I have to think about it a little more. Because I don't want users I don't want my admin users to inadvertently delete a file they have referenced in their database. But you know, I'm learning more about how people are actually using it. Like some of the things I thought people would ask for, they haven't asked for yet. Some of the things I didn't even think of people are asking for, I mean, all three people that responded to me, but it's fun to get feedback.Michele Hansen 8:23 On the the duplicate files. Yeah. Have you asked the people how they would want this to work? if they if they uploaded a duplicate file?Colleen Schnettler 8:32 No, I think I'm going to though, I think that's a great idea. That's I have to explain, I think I'm going to explain to them that. That is why I have not done it yet. I need a good way to like, I really do think I should make like a image or something. So people understand what's going on behind the scenes. But that's a great idea.Michele Hansen 8:53 Did we talk about I think it's called whimsical, it's like a flow charting tool. Colleen Schnettler 8:56 We did not talk about whimsical.Michele Hansen 8:59 Okay, maybe someone else I was talking to, but it's a it's a really cool little flow charting tool that I learned about a couple months ago. And it's just super fast to make a flowchart. And, and, and, and maybe that would be good for this. I also like using whatever that sketching app is on the iPad is, is pretty fast, too.Colleen Schnettler 9:19 Yeah, that's it. Michele Hansen 9:20 Yeah, I think and I think when you talk to people and say, like, you know, here's some like scenarios I've thought of, can you think of other scenarios, and then, like, here is like, and we want to make sure that this is you know, understanding that people accidentally delete stuff like it like it happens and and just kind of have a conversation about them about things going wrong. Because designing for when things go wrong is a huge part of design.Colleen Schnettler 9:49 Right? Right. That's why just and so for the initial rollout. I was like, Look, I'm not charging for storage. It's going to be cheap, even when I do so storage is cheap. I'm just gonna not worry about But, but it has been requested a few times. And I can see why you'd want to do that. Because in your admin dashboard, you can see everything that all your users have uploaded. So if both of them are testing it out both of the people who requested this feature, so you know, the person was like, hey, I want to delete all these files, I'm just testing it, like, I don't want them sitting there. So even maybe like for your visual organization, as you look at your dashboard, it'd be easier to be able to get rid of those files, you know, you're not using,Michele Hansen 10:28 I guess another like, thing there is like, does it? Does it erase the record that it was ever there in the first place? Like, can they see that there was a file uploaded? And then at that file was deleted later? Like, is there going to be a record of that for them? And I would just, it may not be something you need to add right this moment. But I would just surface that with the customers just in case. I know, like audit logs, were something that we had requests for for a long time. Yeah. And they also ended up helping us where if we had a customer say, Why did I get charged for this? I never uploaded this file. Now we can be like, actually, you did? And then you deleted it a week later. Are you like trying to fool us that you didn't upload it? Yeah. But also just for their own purposes, that Oh, like that file was uploaded, and then we accidentally deleted it, but like, not something you need to do at the second. But while you're talking to them about the file deletion process, like kind of just work through with them other scenarios where this information is useful?Colleen Schnettler 11:35 Yeah, that's a great idea. What do you think of email versus trying to get these people on a call?Michele Hansen 11:43 I might have it on a call if you have the time to do it. Because I find that talking it through might be helpful. But then again, they might be the kind of people who like to sit and consider something on their own. But I usually find it very helpful to have people talk me through a process.Colleen Schnettler 12:06 Okay, well, I'll just email them and ask them, like, what they're proud kind of explain and see, see what their preferences because I, you know, I can obviously make time for a call. But um, yeah, so that's, that's all great feedback. And that's, that's kind of where I am so far with thisMichele Hansen 12:21 week, what the third person say,Colleen Schnettler 12:24 Oh, the third person heard me on a different podcast and wanted to try it out and told me that he would give me feedback, which I was excited, hey, if anyone wants to just try it out and has a Heroku account, it's free right now. So just try it out? Let me know what you think.Michele Hansen 12:42 So do you have a limit on how much people can use? Like, it's free right now? But like, is it basically your free tier? Or is it like just, you know, totally, like wild west free?Colleen Schnettler 12:55 No, it's, it's just the free tier, I do have a limit. And if you hit the limit, it when you go to render the UI, you just get a little message that says you've hit your limit or something. No one is even though like I'm checking every day, and I thought people would upload bigger files, the majority people so far, and there's only six, right? Well, I mean, 10, because there's me and other people who were using it before it was in beta. So I thought people might use bigger files, but people are still predominantly doing images, and not particularly large images. So no one's close to even like busting through their, their limit. But something else I want to talk about is I worked hard to make it available off Heroku. So by the time this podcast airs, it will be available off Heroku. And so it was funny, because last week, by the end of our recording of the podcast, I was convinced I was going to do a free tier. And then I was editing our podcast. And by the end of that I was convinced I should not do a free tier, I should do a free trial. So I was so funny. So I did all the work to make a free tier. And then on Sunday, after I was finished editing, I was like, No, I need to do a free trial, not a free tier. So I went back and changed it to just be a free trial. Just some of the things you said about like, I need to know if people are gonna pay for it. Right? Like, that's why I changed my mind. At first I was like everyone does a free a free tier. That's the best way to get people hooked the like it and then they'll want more storage and they're going to upgrade. But I don't really want to support a whole bunch of people who aren't paying me. And if people won't put their credit card down then they probably never I don't know. I don't know. Anyway, so since I since I did it on Sunday, I changed it to now be a 30 day free trial. Hit me with your thoughts. Michele Hansen 14:56 Sounds like you're worried about adverse selection basically? Attracting people who aren't going to pay you in the first place.Colleen Schnettler 15:04 Yeah. And and hear here in this stage, it's fine, right? Like, I have my 100 Heroku users who So sure, hopefully, I'll get enough feedback from that group to kind of see where I stand. But I don't want to then set that out to the rest of the world and have to support every person who never ever has any intention of paying for it. Because like, this has to be a business or not be a business like this isn't gonna be this isn't open source software, right, like storage is not free. So kind ofMichele Hansen 15:34 interesting. You're basically AB testing your pricing model.Colleen Schnettler 15:38 Yeah, I've got zero people are going to sign up for the the free trial, because you know, how stripe has it set up like so. Or at least the way my code base is set up, is even with a free trial. And this is how most SAS is work, I think you have to enter a credit card, because that's the easiest way to get everything set up on stripe. So my free trial, okay, now I'm going to further complicate this, my free trial is actually a free tier. So if you, Michelle, sign up for my free trial, at the end of 30 days, I'm not going to delete your files. At least that's my plan right now. So you can keep your files you just can't upload any more. So it is kind of like a fake free tier. You're looking at me funny.Michele Hansen 16:25 Okay, so Well, I guess the deleting the files wouldn't happen after 30 days. Because at that point, do you automatically charge them at 30 days? Yeah. Or do you instead turn off their account, because that's also know that like some people, most people automatically convert it? Yeah, but some people require you to opt in to upgrade it.Colleen Schnettler 16:47 So the way it is set up right now is you are automatically converted at 30 days to a paid plan. And I made it really cheap, I started at 10, the cheapest plan is $10 a month. But if you cancel, let's say you use it for 29 days, and you cancel. I'm not gonna delete all your files, but I might change my mind, I don't actually have that in my in my copy anywhere. Just for now let's see if anyone even signs up. Because people do not like putting their credit card down. I get it. I don't like putting my credit card down. Like, I totally get that. But someMichele Hansen 17:23 different scenarios there. Right, like so like, somebody has an account, they let's say they upload one file to test it out. And then they forget about it. And then do you. So you let's say you charge them right, so and then they cancel after you charge them. So that's one scenario, then there's somebody who say you upload, they upload a file, they cancel before you charge them, they upload files, you charge them, the payment fails, and you're never able to get it to successfully go through. They upload files, they up, they upgrade or you upgrade them, and then they stay on the plan like so there's a couple of different scenarios there. There's all assuming that you have an automatic conversion. I guess in the cases of somebody who cancels, I question whether you would you should hold on to that, because they may not want you to hold their data forever. I feel like there should be an expiration date like that's like It Will you know, your account will be deleted within 60 days. Because that's a liability for you to be Yeah. Holding on to somebody else's data.Colleen Schnettler 18:38 Yeah, that's a good point. I think what I have now with Heroku is I have a two week grace period. So if you sign up with Heroku, you upload some files, and then you change your mind or you don't like it or whatever, I delete all your stuff in two weeks, I'll send you an email and I'll be like, Hey, I'm going to delete all your stuff in two weeks. I'll probably just do the same thing with this other with the other customers that don't come from Heroku I guess I mean, I need someone to sign up first. So I'm not too much. I'm not really worried about it. Like I can literally do it by hand at this point. I can kind of IMichele Hansen 19:11 think the tricky thing with billing, right is like all of those. Okay, so you know, in your head, you're thinking okay, oh, somebody puts in their credit card, and then they or their use it or they don't. And when it comes down to it, there's like all these other weird ways that things can happen. And it's like, well, what if the credit card fails? What if they cancel before the renewal date? What if they cancel after the renewal date? What if they forgotten about it? And then three months later, they asked for a refund or what if they like it? You know, all of these, like different things can happen. And while you're flowcharting it may just be like again, you don't have to build for these things right now. Yeah, but just so you're thinking through some potential avenues people could go down of like What like, what are the different touch points of? So it's like they create an account, they add a credit card. Also things can go wrong at that stage, like, what if their credit card is invalid? What happens then? And then and like, how do you do you try to figure out if that credit card is good or not like, like, you can or you cannot like that that's an option. And then they upload files, and then what is their upload or cancellation flow look like? Like, what are all the possible options from there?Colleen Schnettler 20:30 Yeah. Yeah, I will definitely keep all of that in mind. But yeah, first, I gotta get someone to sign up. I have a lot of work. Like I've been doing a lot of work on the landing page. Yeah, yeah, static sites are not my bread and butter. Like, some something about static site, you're like, there's all this blank space that I have to fill it with words,Michele Hansen 20:59 that has been doing like a static site in terms of like, a new site, or like, nowColleen Schnettler 21:02 I got it, like the landing page. IMichele Hansen 21:04 like, okay,Colleen Schnettler 21:05 netlify, it's deployed with, okay. natla phi, um, but basically, like, it's just a simple file, upload calm, which is like my landing page. I also want to add, like a documentation section. And I don't know, I mean, people, I think, I don't know if it's too hard to use, or if it's normal for 35 people to sign up and only six to use it in the Heroku marketplace. But I wonder if it's just still confusing people. Like if I need to do more documentation, I basically what I'm trying to figure out, what should I do next? Should I do more copy as terms of like, why people need it? Should I do more documentation and focus? Since I'm clearly getting people from Heroku? Should I really focus on the integration from the Heroku? side?Michele Hansen 21:54 So you have 31 people who have signed up for it right? And then Ember j said you've had, what, 10 or 12? who've gotten to the sign in part of it?Colleen Schnettler 22:05 Yeah, yes. Yes. SoMichele Hansen 22:06 you have about 20 people who have kind of dropped off in the early part of the process. Correct? Have you emailed them saying, Hey, I noticed you, you know, indicated an interest in using simple file upload. But I noticed you haven't gone through that. Can you tell me why?Colleen Schnettler 22:25 So I don't have their email addresses? Oh, because it's that two step process. So to configure to provision it, it's provisioned on their team, but the way that Heroku the way the Heroku communication works, they don't give you any team identifying information about the team that provisioned your add on, not until they go to single sign on.Michele Hansen 22:46 So what is the process? Like for the user? When? Like, can you walk us through those steps of like they see you on the Heroku marketplace?Colleen Schnettler 22:57 Yes, so they see me on the marketplace, there's a one click Install button. So they can do that. Or they can install from the command line. If they install from the command line, they will see basically, what I do is I set my API key and their environment variables. So there's two ways let's say they click the button, because I think people like to click buttons, right? It's, it's fun and friendly. If they click the button, they and then they never go in through single sign on. So they just click the button, they would then have to go into their Heroku config, get the environment variable that is their API key, they would then have to go to the Heroku Doc's page and figure out how to install the add on or to use it on their site with their API key in their application. One team has figured this out and has never single signed on, but they're uploading files. What typically you would do as a Heroku user for something you really wanted, you would click the button to install it. And then you go to like your, your overview page for your application. And there's a little section under your resources tab that has all of your installed application, or all of your installed add ons. So that's like Postgres Redis, whatever other kind of stuff you have mine would be in that list, then you have to click on simple file upload in, in your resources tab. And that is your single sign on that takes you to my application. And if you do that in my application, I have your dashboard where you can see all the files you've uploaded, and directions with your API key like in the script. So you can literally just copy the script tag. You don't have to like put the API key in yourself.Michele Hansen 24:43 I imagine you're not the only person with an app on the Roku marketplace, who has this problem of people clicking the button and then not actually fully completing the install process. So I'm curious Have you been able to like find anything from other Heroku marketplace developers on how they handle this drop off.Colleen Schnettler 25:05 So apparently, you can add Google Analytics to your elements pit, your Heroku marketplace page, which I need to do, and I haven't done yet. So I could at least see what kind of page views I'm getting. I don't know if you can do like a full sequence, you know, like, Oh, they dropped off here. And I need like a little club with people who have add ons. Roku marketplace club. So I don't know, I need to reach out to the people I know and see if they do anything about this. And if they see similar numbers, because that just feels like a really low conversion number. I mean, just because it's not a low conversion number for like the random internet. But someone clearly clicked on a file upload, like, Yes, I want file uploading. So why would they click on the Yes, I want file uploading button and then not install it? Because my initial thought is because they don't understand what it does. They don't understand how to install it. They hate JavaScript. I don't know. Like, there could be many reasons. But there couldMichele Hansen 26:09 also be people who are listening to the podcast who want to show support for you. But who don't necessarily need it like that. I that could be a couple of people in there.Colleen Schnettler 26:19 I mean, we don't have that many pockets, listeners,Michele Hansen 26:22 dozens!Colleen Schnettler 26:23 and dozens of people. I think but I think those people because I've actually talked to a few of those people who have reached out to me on Twitter, PS, if you listen to this, and you want to try it out, reach out to me. Those people are more motivated to install it. Like Like that one person who emailed me he was like, Hey, I heard you on this other podcast. And I wanted to, you know, check it out. And I was like, sweet, I think those people are more motivated to to actually go through the entire install process. Because although we don't know each other in real life, like we internet know each other. And, you know, I would do that for someone else. So I don't know, I don't know, if people are confused. I feel like it's probably a problem with my documentation in that either they don't understand what they are getting. Or they find it too painful to install.Michele Hansen 27:16 I feel like maybe we should like workshop, your landing page on the Heroku marketplace. Yeah, and kind of think through like, because because it doesn't sound like you have a whole lot of control over what happens after they click that button. And so you need to find a way to make it clear to them that's like, okay, here's what you have to do for the process. And here's what you do next. And basically so that they know to go back there to find the instructions for getting started.Colleen Schnettler 27:51 Yes, I think that's a great idea. I tried, and I've been updating it just this week, like using some of the story brand stuff I've been thinking about. Like before I had a paragraph and now I have a list, you know, to make it seem like even easier. Like here's the list of things you do. Man, I know. It's just I wish I could. You're right. I don't have control between when they click the button, like this install button to why they don't actually install it. Yeah, I would I would love to go over the the landing page with you.Michele Hansen 28:23 Yeah, we can totally do that. So I am now looking at your page on the Heroku marketplace. Yes, I see this button you have been talking aboutColleen Schnettler 28:34 install.Michele Hansen 28:35 That's the way I do that. And the little flowchart you've made of how the process works. But I noticed that it's not until I scroll to the very bottom that I see the documentation links for it. And I kind of Yeah, I kind of wonder if that should be somewhere near the top at least that's like, I mean, something that basically says like after you click to install this, like here, here's the documentation, kind of making that it doesn't look like you can really make it above the fold per se. ButColleen Schnettler 29:13 no, so I have control of that image, that image I made with snappa. I have control of all of the language right below that that image that says cloud storage pleasing UI with built in error handling CDN direct uploads. That's what I have control of so I can put links I could also put a link to my real website, simple file upload.com in there, and if I put the documentation there, maybe that would be more helpful get them off, like get them to a page that you know they're more comfortable with or something.Michele Hansen 29:44 Yeah, yeah, I think I do you have to have this region availability section two, like do you have control over where thisColleen Schnettler 29:52 uh, I do here I do not have control over that. As far as I know. I have to I have to have that.Michele Hansen 30:00 Gotcha. Okay, so But does that have to be the first section? Yellow? The copy?Colleen Schnettler 30:06 I think so I'll double check, but i think i think so. Okay.Michele Hansen 30:10 Yeah, I mean, maybe just you have a great description here of like, what the process is once they have installed it? Yeah, but less. So what the process to install is. And I feel like I have seen other people with Heroku apps, like, can you have multiple images? And this hero?Colleen Schnettler 30:33 Yeah, I have that space. So I can do whatever, yes, multiple images, I can do whatever I want with that space.Michele Hansen 30:39 So maybe you could just have one that describes the process for for getting started, like, you know, you click the button or use command line and you look at our documentation, and then you, you know, like, yes, like a very broad overview.Colleen Schnettler 30:54 Okay, I know exactly what you're saying. Because because that's kind of what on the left here, I said, I say number one, install the add on to create an input type of file three, add JavaScript snippet, or react component. But maybe I should even break that down more. It'd be like one, click the button. Get your API key, even.Michele Hansen 31:15 Even where you haven't right now, just step one, install the add on. I mean, that's multiple steps itself. Yeah. But I maybe even just having parentheses. docs with a link. What? Yeah,Colleen Schnettler 31:27 that's a great idea. Yes, yes. Yes. And you know, the cool thing, if they do install it from the command line, they can open their single sign on from the command line. And that's not obvious to someone who doesn't do that. So even that would be helpful. Yeah, now that I look, again, I'm seeing ways I'm seeing I'm seeing ways to make it even easier to to show people how to get started with it.Michele Hansen 31:52 Yeah, you've built things that you're basically not talking about.Colleen Schnettler 31:56 Yeah. Okay. I love that idea. I love that I'm making Yeah, break it down even more a link to the docs, I can link to my page once I get that up, like my landing page, which will also have documentation on it, but like, like, click the button, open Single Sign On this way, copy this JavaScript snippet.Michele Hansen 32:16 And I guess we can throw a link to the page in the show notes. So if people want to take a look themselves, and like, maybe they have some thoughts on how to make it clear how people get started, or if if something seems unclear, maybe that would be helpful.Colleen Schnettler 32:34 Yeah, I would love that. I'm open to all suggestions at this point, especially people who might go through this process or like, wow, this, this is unclear, or I thought it did this thing, but it does this thing. Or something like that. Okay, that's a great idea. I love it. Yes, cool. Cool. All right. Well, I kind of commandeered this week's episode. Sorry about that, hey, this is exciting stuff is fun. This seems like a really fun time. Like, right? There's something about this period of time in building a company that I just think is really exciting. So someone mentioned to me it was either on Twitter or Slack. I don't remember. He started a few successful companies. And you know, he was like, this is the most exciting time like initial launch and getting people to use it and like, every customer is exciting. And I was like, yeah, that's exactly where I am. It's super fun.Michele Hansen 33:29 It's so exciting. All right. Well, I think on that note, we're gonna end for today, and we love to hear your feedback on Colleen's landing page. You can tweet at us at @softwaresocpod, and thanks so much again for nominating us for the MicroConf SaaS Podcast Awards. It really means a lot to us.
Snowballing One Project Into Another
Colleen Schnettler 0:00 So Michelle, I saw that you recently published a blog post a little bit about the founding of your company. And I haven't read it, because I want to hear the story fresh from you. And I, this is something I've actually wanted to talk to you about, frequently, and you've always kind of just been like, Oh, yeah, you know, we just started it. And then it just, you know, happened. So I'm super excited to dive into this with you, especially where I'm coming from, like, where it seems so far away to have a successful SaaS. So tell us a little bit about how you guys got started?Michele Hansen 0:31 Yeah, this is something I get questions about, all the time. And I wanted to dive into the story and the numbers a little more. Because I think that's helpful for people when they're getting started, like yourself, to see that you don't have to have success the first day, or the first month, or the first three months or four, six months, really in order to make something work. And then also that if something, you know, does okay, but not great, you can always chase that and snowball it into something else.Colleen Schnettler 1:10 So how did you guys get started? What was your very first product?Michele Hansen 1:15 Well, my very first product? Or our very first product?Colleen Schnettler 1:18 I don't know what gave you the bug, like, let's go back, just let's talk about about you. Michele HansenOh!Colleen SchnettlerWhat was your first, like, What gave you the bug?Michele Hansen 1:25 So, so this actually, this isn't in the post, but my first business, if you can call it that was basically a blog that I started with friends, my freshman year of college, we called it an online magazine. And the whole idea of it was college kids from around the country, with different perspectives on politics, all writing about politics together and collaborating together. And that was really one of the first things that introduced me to running something online, in a sort of organized way, because I had little projects before, like, you know, we also started a satire blog at one point, but like, we didn't put our names on it. And it was very much for fun. And like that project, talking about how to use Blogger, and then this other one that we launched, that was a bit more serious, and like something we ended up putting on our resumes, was on WordPress, and just how it happened was I ended up being the person doing all the WordPress admin. So managing the site, and, you know, customizing templates and stuff like that, um, you know, my introduction to coding was MySpace. So HTML, you know, for a certain generation of us was a key skill as a teenager. And that carried over, but I think those projects, my freshman year of college really gave me the bug of like, you create something, and then you get a, like, a reaction from people. And you, people tell you, they enjoyed it. And then and then, you know, just kind of keeps you going like that. And then actually, a year later growing, though, so that blog actually never made any money. We had ads on it, but then I don't know, something happened. And it didn't work out. And we didn't make money. Um, but then we actually ended up turning it into a consulting firm, like a social media consulting firm. So that was when I was 20.Colleen Schnettler 3:39 I mean, that was 2010 ish. So that was like before, that was a big thing, right? Social media consulting wasn't the powerhouse it is now.Michele Hansen 3:47 Yeah, it really wasn't as well. And so what are our angle was, was reaching out to PR firms that were, you know, very experienced in PR, but didn't know how to use Facebook and Twitter. And that was really where I earned some more business chops, in terms of like, actually, like operating a business and writing proposals and pitching and doing sales and things like that. You know, I'd had a little bit of experience with that, like, you know, when I was a kid, my mom had an art business, and I would spend Saturdays as a teenager helping her sell her art at art and craft shows. But really, in a kind of, you know, a context that is the closest to now, it really wasn't until college. And then we actually made money doing that, but then shut down the business about six months later, because basically, the purpose of the business was to allow us to skip several layers of terrible internships and get to the ones we wanted, faster. So there is an exit strategy from the beginning. And, and so actually, by the time that we made the, Mathias and I made the products that ended up being the one that funded Geocodio, that was actually my third business. Okay. And I think all of those little experiences, you know, really added to just having more comfort with what it takes to launch a product, even if those other efforts were not quite as organized, or structured, as at you know, as the as the projects that Mathias and I have launched together.Colleen Schnettler 5:38 Yeah, yeah, well, even you were talking about, you know, back in your college days, like reaching out to ad agencies and things like that, like, for a lot of us who are just starting businesses, this is the first time we've had to do any kind of software sales or sales. Really, I was thinking about that today. Because this is just something that like, I don't do a lot, like, I'm comfortable with people, and I like to talk to people, but like, I'm basically cold emailing everyone who has signed up for my service, to be like, Hey, can I help you? And that's like, a little thing, but just, it's still outside my comfort zone. So you starting those lessons 10-15 years ago, you know, they just compound I'm sure to bring you guys to where you are today.Michele Hansen 6:20 Absolutely. I mean, it's totally useful, you know, on Mathias aside to his early projects, one of which was the precursor to when the first one we launched together, you know, he was funding those because he was a magician as a child. And so he had his, like, he was running his own business, like, as of the age of seven or so eight, was when he started performing magic. And so he always had that money to fund, you know, other projects that he wanted to do, or, you know, buying the latest and greatest tools and whatnot. Yeah, it's not just the most recent business, it's a history of having that, as you said that that bug of "Hey, like, this is, this is fun, and I can do it." And also, like, making a ton of mistakes in the process, like accidentally not monetizing our blog. I mean, it was or like, I think we did, but then, you know, some of our friends, like, we had ads on it. And some of our friends knew that if they clicked on them, we would get money. And so they clicked on them. I think we got shut down for having like, suspicious clicks on them or like something else going on. Like, you know, I mean, we were like 19 and idiots. And, you know, but you know, it introduced me to things like that. And it got me you know, more comfortable using a modern web tools like WordPress.Colleen Schnettler 7:54 Yeah. So then you guys, you and your husband decided you wanted to start something. And you just use the phrase, the thing that launched Geocodio. So can you tell us a little bit more about that? What was that?Michele Hansen 8:06 Yeah. And you make it sound like we just had this idea one day, and we're like, oh, like we're going to launch thing something. And the reality is, is that we were pregnant. And we knew that daycare was going to be expensive. But once we figured out just how expensive it was, which for an infant in the DC area is about $20,000 a year for a very standard, no frills in-home daycare that might not even be licensed, like, really expensive. And so we were scared out of our minds by that expense. And we were like, you know what, we can kill it at work, but like realistically, in the next, you know, six months are we going to get raises and bonuses equal to $20,000 a year. Like if we want to be able to keep our standard of living, we need to be launching stuff. Colleen Schnettler Yeah. Michele HansenSo it's with that motivation as the backdrop that we finally stopped spending our weekends watching TV shows and started working on stuff. So this came out of an app that Mathias had launched in Denmark before he moved to the US. And the app was called What's Open Nearby. And the idea of it was that if you needed milk at midnight, or a coffee at 3am, you could pull up the app and it would have a map of all of the stores that were open near you. So that you could just go to the one that was open rather than having to like remember what stores were near you and type it into Google and then go to their website and go to their store locator and find the one that was near you. And then like look at their hours. Now right now you can go to Google and type in Safeway hours, and it all pops up there. But the Google Places API was really not as robust in 2013 as it is now, and it wasn't as integrated into the Google search experience. So, you know, this would eliminate, you know, 10 clicks when you're tired in the middle of night in and out of toilet paper. Colleen Schnettler 10:13 Sure.Michele Hansen 10:14 launched this in Denmark before he came to the US. And it was really successful. It was based on a need that he had himself. And it was regularly in the top charts in Denmark, and it got to about 500,000 downloads...Colleen SchnettlerWow!Michele Hansen ...Which is something like 10% of the Danish population. And how he monetized it was, people would pay to have their store listed in the app, got it. Colleen Schnettler Got it. Michele Hansen But that really only worked because it was consistently top 10 in the Danish App Store and had all of these downloads and so companies wanted to be in it. By contrast, we knew that launching in the US would be much more difficult. And, you know, a much larger country not nearly as close knit, as Denmark is. So, um, so we decided to go with an ad supported route. Colleen Schnettler Okay.Michele HansenSo we started working on the app in January of 2013. And we ended up launching it in October of 2013.Colleen Schnettler 11:29 So that's a that's a good chunk of time that you guys were working on it. Was that predominantly development time, or was it predominantly like customer research time, like, what was happening during those months from conception to launch?Michele Hansen 11:42 So it was a couple of different things. So one of them was, we had to localize the app to the US. We did a redesign of the app, I'm not quite sure. I don't quite remember why we did that. But I know that there was some issues with the Danish app. And I like remember, we had to design a new bug reporting flow, like if people had issues with the hours, so like, people could like take it. Like if the hours we had in our app were different, like they could take a picture of it, if they're standing at the store, for example. So we were also we also just had to pull all of the data together. So a big part of the app was automated parsers that were scraping the store hours websites. And so we are building all those parsers. But then we also wanted to make sure that we had a lot of smaller stores in there as well, because that works really well for big chains, but a smaller store, it didn't really make sense for us to build a parser for that, because we'd only get one or two locations rather than 50 or 100, or 500 from a big chain. So we spent a lot of time just building the data that goes into the app. And that was most of what consumed us. It wasn't until August of 2013, actually seven days after our daughter was born that we incorporated formally. Colleen SchnettlerOh, okay. Michele HansenYeah. Um, and started doing the administrative side of things. And so I was actually so you know, so we talked about bootstrapping, right. And bootstrapping is, is is fundamentally a form of financing. If you're taking the null option, right, which is you don't take financing, but, you know, you self-fund it, and so towards that, and I kind of dug through our financials from that first year, to look at how much we spent, and how much we made because this self funding period is really difficult for a lot of people. Colleen SchnettlerYeah. Michele HansenUm, so first, one thing I want to mention first, is that in the spring of 2013, we did a couple of hackathons. And like, you know, big sort of sponsored ones, they don't seem to be as popular anymore. Maybe I'm just not paying attention to it, but I remember it being kind of a big thing. And, um, we got an $1,000 AWS credit as a reward from one of the hackathons. I think that might have been from a like Facebook-Gates Foundation hackathon that Mathias did with one of his friends in California. Anyway. So it was like one of the prizes for that. So we had that sweet $1,000 credit from Amazon. Now they give these out as a way to, you know, promote people to switch to AWS, right. And $1,000 is not really a lot of money for an established business. But for a nascent businesses just coming into existence, $1,000 is huge. And that paid our server costs for the first couple of months. And I think that was really important for us because it took away a lot of the pain of self funding the product. And so we basically, you know, you could say that we took, you know, non-dilutive non-debt funding from Amazon to get started. But we had other expenses as well. And so this is something I was sort of looking at, okay is like, how much did we really spend? So, I mentioned that we had to incorporate the business. We had, we were paying for servers for the Danish app. So even though we didn't have a regular income stream from it, we were still supporting it. And we needed SSL certificates, icons, sort of all sorts of things. So September of 2013, is the first month like, sorry, August of 2013 is the first month that we really started having expenses. So we had $416 in expenses. Colleen Schnettler Okay. Michele Hansen And 20 cents in ad revenue.Colleen Schnettler 16:04 But that was your very first month, right?Michele Hansen 16:06 Yes, that was our very first month. And and you know, as I look at this right now, you know, the server costs -- I don't know how your husband feels about this, but I feel like when you marry a developer servers are going to be part of your family budget, no matter what.Colleen Schnettler 16:20 We have servers in our garage. It's fine. It's not weird at all.Michele Hansen 16:24 You know, I mean, so you know, I remember going in as me like, okay, we're always like, servers are just gonna be a family budget line item. Um, but you know, so yeah, that was like, $400 is a non-insignificant amount of money, especially to us at the time. Colleen Schnettler 16:39 Well, you had a baby. Right?Michele Hansen 16:41 Right. Yeah.Colleen Schnettler 16:42 So, so wait, before you keep going with your numbers. So that first month, here you are, you guys are still both working full time?Michele Hansen 16:50 Mm hmm.Colleen Schnettler 16:50 You have a brand new baby, and you're just out 400 bucks. Do you remember how that made? You feel?Michele Hansen 16:56 No. I don't remember much from that first month.Colleen Schnettler 17:00 I mean, I'm just wondering if there was like panic, if there was, you know, kind of a known sense of patience. If there was a this is a terrible idea.Michele Hansen 17:08 No, I think if anything, I remember being super motivated. And I think that's the biggest thing I got from becoming a parent was motivation. And that, you know, the idea that, you know, when you have a kid, like you have maybe an hour to yourself a day, if that, like, you no longer have, you know, the evening doesn't stretch in front of you after work, right. And in, you can't do whatever you want on the weekends, and you have no control over your time anymore. And for both of us, that was really helpful, because it was like, Okay, if I only have an hour to do what I want to do today, then I'm going to make it worth it. Colleen SchnettlerYes. Michele HansenAnd, and as a procrastinator, you know, it was really helpful to have things be time box like that. And you I remember, you know, sitting in the nursery, which was like part nursery part office, and she was sleeping, and we were both working, and it felt like really great. Like it felt it felt good. It felt like what I wanted to be doing. Um, and we knew it was going to be expensive. But I think because we had had that success from the earlier version of the app, we had a lot of confidence going into it, that it would be successful if we did the work.Colleen Schnettler 18:28 Okay. All right. So then what happens next? Michele Hansen 18:31 Okay, so October of 2013, we finally fully launched I think, in September of 2013. We're only you know, friends and family launched. Um, and, yeah, I'm not quite sure, actually, cuz I don't our Apple developer subscription wasn't until October of 2013. And I remember that being very painful. That was $100. Right off the bat. And that was -- that hurt a little bit. Um, so October of 2013, the month we launched, we made $6 and 66 cents.Colleen Schnettler 19:07 That's not concerning. Michele Hansen 19:10 No, right? So, but we were hustling pretty hard. Like, you know, I was spending all of my free time -- that free time I didn't have -- emailing and tweeting at reporters in the DC area trying to get them to pick up on the app. And in November of 2013, we actually ended up getting picked up by DCist and by the Washington Post's Express. So Express is like the free newspaper that they hand out at the metro and in 2013, and quite frankly, probably still today. Service is terrible in the metro tunnels. So a lot of people actually read the free newspaper, and they had this like beginning section of the paper where it was like Quote snippets from people. And we had posted the app on Reddit. And then people had commented on it on Reddit. And so they had posted one of those Reddit comments in the, in the newspaper. And that was huge for us. And that month, so November, we had $155 in revenue. And then December we had $515. Colleen SchnettlerWow!Michele HansenSo we went from 20 cents to $515 dollars.Colleen Schnettler 20:31 Yay. That's great. That must have felt so amazing.Michele Hansen 20:33 Yeah, we were so excited. And I mean, I remember we spent Thanksgiving week basically the whole time, like, updating all the parsers and making sure we had Thanksgiving hours in and I emailed like 100 local business owners trying to get their Thanksgiving and Christmas hours. And we spent so much time on this, but really felt like it was paying off.Colleen Schnettler 20:57 Yeah, that must have felt amazing.Michele Hansen 21:00 Yeah, it was, it was really exciting. And I think though, the exciting thing about doing a consumer app too, is that your friends are using it. Colleen SchnettlerYeah.Michele Hansen And so I was getting messages from people I know being like, Hey, this is so cool. Like, thank you for making this. This is awesome. And you're like, yeah, this is awesome. Like I'm making something that helps my friends, this feels good. Versus in B2B, you doesn't really happen quite as much. Um, yeah, it felt so good. But we started to have some problems. Colleen SchnettlerOkay. Michele Hansen So I mentioned how the app, you open it up, and it had a map to show you all of the stores that were near you. So we could get 2500 locations for free from from Google. But then, if we added more stores, beyond 2500, we could only cache them, this was sort of the problem, we couldn't store the coordinates in a database, we can only cache them. Colleen SchnettlerOkay, Michele Hansen So we had, so we needed more than 2500 coordinates, we didn't have any options. Colleen SchnettlerAhh. Michele HansenBecause it was either 2500 for free. Or you could have an enterprise plan that was like $20,000 a year, 100,000 a day. And we're like, we have 5000 stores in the app, like we don't need 100,000 a day. And we're certainly, you know, we're feeling pretty good about our $500 in ad revenue here. But that's not remotely justify paying for an enterprise contract. Like that's insane. So what we did was, we built a very, very rudimentary geocoder out of this, just to support the app. And as we talked about this with other friends of ours, who are developers, they said to us, "well have you guys considered, you know, slapping a paywall in front of this and, you know, letting other people use it. And, you know, maybe you can get enough people to use it that the servers will, for it will be effectively free for you?" And we're like, oh, like, that'd be really interesting. Like, if you know, we can just get enough people to pay for it, that we basically don't have to pay for it ourselves. Like, like, that would be cool. And then we can keep our apps going, because these apps are making money and they're working. And so we did a month or two of testing with other people. There's actually a really awesome picture of Mathias with our daughter at three months old at 1776, which is a co-working space in DC with with tons of startups, they're like meeting with our friends here and test it out. I feel like it's very emblematic of our family and our marriage. And so then we launched Geocodio in January of 2014, with our definition of a wild success, being that more people paid for it than it costs us to provide it. Colleen SchnettlerOkay.Michele HansenI remember making a spreadsheet of this. I can't find that spreadsheet, but that was a wild success was.Colleen Schnettler 24:10 Sure. So what happened?Michele Hansen 24:12 Well, so then we so we launched Geocodio.Colleen Schnettler 24:14 Right, okay. And right. Okay, so, wait, yes, that point, though, were you you guys had both products? Or did you sunset that? I mean, that one product was making you 500 bucks, which felt like a million probably. Were you? Yeah, both products at the time?Michele Hansen 24:27 Yes. So we're absolutely maintaining both our focus was very much on the app. And in January of 2014, we made $514 from the app, so it was still like that was the same as the previous month, but we still felt pretty good about that. Um, and we're pretty focused on both though the success of the Geocodio launch really took us by surprise. Like we ended up being on the front page of Hacker News all day, which was a huge surprise to us. It was, it was pretty surreal. Um, and so we ended up having $31 in total revenue for that month or about $27 after fees. Colleen Schnettlerokay. Michele HansenAnd Geocodio was running on two tiny little DigitalOcean droplets, one web server one database server. And so we were was gross margin perspective we netted $7, which was absolutely amazing. Like we were surprised, like we hadn't even written the, the code that would trigger the billing code to charge people because we had not expected that people would want to pay us. Colleen SchnettlerThat's amazing. Michele HansenBut so so but then that next month, like the the ad revenue continued to drop off. And we kind of learned the hard way that with consumer businesses like marketing has to be constant, like you have to constantly be in front of people, otherwise, the attention is going to drop off. It's not like a business where if you sign them up, and then they have a recurring need, they're going to keep having that need. So I posted all of the revenue charts on the blog posts, and you can kind of see that the last month where the app and Geocodio made the same amount of money was April of 2014. And then from there on Geocodio do just takes off like a rocket, and our ad revenue goes down quite significantly.Colleen Schnettler 26:32 That's amazing. I love that story. Like I love that Geocodio was born out of something, you guys needed yourself. And you didn't even think it was going to be that successful. And now it sustains your entire family.Michele Hansen 26:45 Yeah, and any other app we had came out of our own needs as well. And I think there's some similarities to what you are doing as well there. You know, we should always validate our ideas against what other people are trying to do. But especially for a first project, it can be so helpful to do something that just scratches your own itch does, it makes you feel good. And yes, you, you get that motivation going. And as much as you can, you know, snowballing the revenue from one project to another, snowballing the motivation that you're getting and a positive reinforcement you're getting from one project is so helpful for the other one, because like a geocoder is not a very exciting project on the face of it like and few people would sort of jump into that right away. We only arrived at that is because it's something that we needed ourselves. But that in turn ended up being such a great way for us to start a business because we were developer first from the very beginning. And we were out to solve the things that frustrated us about all of the other services out there. Like the whole thing about only being able to cache the results rather than store them in the database very early on, we decided you should be able to store them, like we don't want to stand over customer shoulders, telling them what they can and can't do. Like we just don't believe in that, we're not going to do it. That is a formed a lot of decision that we make, or we're going to have a free tier and we're going to have a pay as you go model to make sure that it's affordable and accessible for people, regardless of how big their project is like. Those are things that are really important to us. And you know, something that we ask ourselves, every time we're making a tough decision is okay, if we were the customers, what would we want to happen here? And how would we want to be treated? And sometimes the answers to those things are not the immediate profit maximizing decision that a larger company might make. But one of the reasons why we do this is to solve our own problems. And we don't want to create a product that creates problems for people, people already have enough problems. They don't need a product to create new problems for them, like being only able to cache things or all sorts of usage restrictions or whatnot. We just don't believe in that. Colleen Schnettler Yeah. Michele HansenAnd so as a and that really wasn't a perspective that I had on business until we encountered this product like you know, I don't I don't think I believed anything negative about treating customers but I didn't really have I hadn't really felt that pain myself of "Wow, like this really, really sucks but you want to use a product to get something done and then the product creates problems and hassles for you, like why is this happening? It's already hard enough to create something." And so that that idea that we are ourselves the customers really drives what we do and I always find it so fun when I you know, create new little side projects here and there that happened to run on Geocodio. Because we always end up coming across new ideas or like, oh, like, yeah, we should, you know, we could do this or, or we could do that, like, I think you remember the the app we made in the spring to help people find grocery store pickup slots. So that had geocode do in the backgrounds. Yeah. You know, locating unit, you know, the nearest Wegmans, or Harris Teeter to help you find a pickup slot. So yeah, it's, it's, it's, it's been fun. But it certainly required a lot. A lot of initial initial investment from us, like, you know, I think back to that, like $416 on 20 cents in, in revenue, that's a lot of money. I remember at the time like, that was basically our car payment. So that was a non-insignificant amount of money, we had a child, so we didn't have a lot of time. But also, we were fortunate enough that we had full time professional jobs, and we didn't have to have second jobs as just a part of our normal life, you know, this is a choice that we made, and we had the luxury of being able to spend our free time on this. And as children, we had, you know, the opportunities to learn about business or play around with coding. We didn't have to be working, you know, have to be working as children. And so we had that time to explore. And so that's something I always think about that. Yeah, we had several years of not a lot of sleep, and not a lot of free time. But there are so many advantages that we had going into that. And I think that's also something that inspires me too, you know, not only to feel like I'm making the most of those advantages, but also to try to inspire other people to do this as well, recognizing that, you know, maybe other people didn't have parents' businesses to observe as children like both of us did. And, you know, things like incorporating a business or doing sales are much more intimidating for other people. And so to try to demystify those things and make it easier.Colleen Schnettler 32:08 Well, Michele, thank you so much for sharing your origin story of how you and your husband started started Geocodio. I've really enjoyed hearing it, and I'm sure our listeners did as well.Michele Hansen 32:21 Yeah, if anyone else has follow up questions, you know, always feel free to tweet at me. I'm certainly happy to talk to you about it and see if I can help with what you're trying to do.Colleen Schnettler 32:34 So that's going to wrap up this week's episode of the Software Social podcast. Feel free to tweet us your questions and comments at @softwaresocpod. Thanks for listening.
Choosing a Pricing Model
Colleen Schnettler 0:00 So one of the things I kind of wanted to talk about was a few weeks ago on the podcast, I sat here and I told you that what I really want is a job where I only have to work nine to five. And I bring that up. Michele HansenYeah?Colleen SchnettlerI seems great. But my husband totally called me out on this, he pointed out that I have had jobs where I've only had to work nine to five, and I have quit them all. Michele HansenReally?Colleen SchnettlerYes. And so it just got me thinking, you know, as I go on this journey, and I, I tried to get my mental, like my headspace aligned for what I want to do in the future, I really don't want to go back to a corporate job, I think about this side project thing that I'm doing as something that like, I'm trying, and if it doesn't work out, I'll go back to a regular job. But I don't want to do that, like ever. So I think that's just an important like mental space for me to be in like, this is what I want to do, I want to build a business. And so you know what this might be a huge failure. But that doesn't mean I'm going to give up and I'm fortunate and that I can consult like fill in the gaps until I get there. So I follow this VC on Twitter, her name is Elizabeth Yin, and she had this great Twitter thread about marketing and, you know, starting a business, and one of the things she talked about is like, if you're an entrepreneur, that that is a career and some people you know, you can get five to 10 chances to get it right. And sometimes you can be brilliant and get it wrong. And sometimes you can be not so great and get it right. So you just have to keep trying. But for me, that's a total mental shift of how I think about this process. Like, instead of thinking of this as a thing I do in my free time that might work out, I'm changing my mindset to like, this is the thing I want to do. And right now I can't afford it to do more than I can't afford to do it more than in my air quotes free time. But long term like this is the path I want to be on. So I just wanted to share that because I thought that was like important that, you know, as we go through this process.Michele Hansen 2:00 I remember pre-pandemic, you were working on your consulting Monday to Thursday. And then you were devoting Fridays to side projects, getting your own business going. So it was like, like an 80-20 split between consulting and I'm curious, has that shift? I mean, shifted in the last couple of months? Since you you really started focusing on your in an image management service? Colleen Schnettler 2:29 Yes, it really has, I think one of the things, you know, almost all developers will say is like software is harder than everyone thinks it is. And it's just like, all of these things you have to do. And you have to do. So I would say I've almost shifted that balance. I'm doing 80% file uploader and 20% consulting, maybe, you know, probably something like that. Maybe two days a week, I'm doing consulting. But I really, the thing is, I think it's important, remember, like, I really enjoy it. Like I really like this side project, I'm really having a good time. And I'm really learning a lot. And so yeah, it's just, I've just been giving it a lot of time. And I feel like you know, that's something if I'm going to try it, I'm going to try it. So that's what I'm doing.Michele Hansen 3:16 Something I hear in your voice is how excited you are about what you're working on. And when you mentioned your conversation with your husband about the times you had a nine to five job and how much you hated them, it sounds like there was no passion there. And so yes, the hours are important, but it sounds like something you value is being challenged. And it sounds like you weren't getting any of that challenge or excitement or newness in those nine to five jobs or even really the responsibility maybe that that comes with running your own project, which, you know, we all know in large corporations, it's the hard thing to find.Colleen Schnettler 4:03 Yeah, I totally agree. And it, it really hit home for me that what I really want is -- I mean if I had to pick between being bored and being stressed, but like being challenged, I would pick stressed and challenged. I mean, for me that's that's just who I am. That's what I want. I can relatively I don't wanna say easily, but like relatively, you know, painlessly get a job and that's just not what I want, at least for now. At least, you know, for as long as I see it for the next couple years. I have time. Right there's all this internet propaganda that makes it seem like if you don't have you don't start a business and you're not successful in a year, it's never gonna work for you. And like I have time you know, I can just keep keep working on it until something works.Michele Hansen 4:48 I think it's really an advantage is having time and being able to be patient, and I saw that Twitter thread you mentioned as well. And you know what stuck out to me from that is that is that your first business may not be your, your business for the long haul, right? And you know, I was actually just writing about this, how we snowballed small mobile app into Geocodio and basically funded it with that. That mobile app made 20 cents its first month.Colleen Schnettler 5:22 Wow.Michele Hansen 5:24 I know. It's impressive, right. And if we had been set on quitting our full time jobs as soon as possible, we would not have had the patience to go through basically the year and a half it took to get that up going, that app making enough revenue that then we are exposed to the problems that led us to creating Geocodio and then that app funded you Geocodio and then eventually that app [was] surpassed Geocodio. Do. But if we had been impatience, that would not have happened, but at the same time, you know, sort of what you said we were excited by it. Colleen SchnettlerYeah. Michele HansenIt was thrilling in a way that we weren't really getting from the rest of our work. And that excitement was enough to carry us through even when the revenue maybe wasn't there. Colleen Schnettler 6:21 Yeah. So last week, we talked about me making this software available off of Heroku. Because Heroku is going to make me wait till I have 100 users before I can start charging for it. So remember you, you told me I need to figure out if anyone's going to actually pay for it, which is great advice. Great advice. So I actually sat down. So last week, I kind of like talked in generalities about pricing, but I actually like sat down and tried to figure out how much to charge. And I have no idea like, No, I can't. So I looked at these other competitors. And there's like no consistency in their pricing. I'm -- like, I have no idea. So you have to have the people we talked about are like the big image management companies and their first tier are at $89 and $45, respectively. But there's also an add on on the Heroku marketplace now. The guy just resells S3 buckets. So he doesn't help you upload your files, he literally just gives you an S3 bucket. And he starts at $5. So I feel like there's this huge range. I have no idea like, how should I start with this?Michele Hansen 7:35 You have some people you've talked to who asked you if you're planning to make this available off Heroku? Colleen Schnettler Yes.Michele HansenHave you asked them what they are currently paying for this, whether that's a service or simply a three are their time? Like, have you gotten a sense of that, from that?Colleen Schnettler 7:51 I have not asked them that.Michele Hansen 7:54 I think that would be a good place to start.Colleen Schnettler 7:56 Okay. And you're just what if they're not using anything right now that they're paying. Michele Hansen 8:02 So that can be a good thing, and a red flag.Colleen Schnettlerokay.Michele HansenIt could be a good thing in the sense of if they are only spending time on this. And that time is a painful amount of time for them, like multiple hours per week, for example. And they're really willing to pay for it. That can be a good sign. But if they're not currently paying for it, and they say it's they're spending time on this, but it turns out, that's an hour every six months, then that willingness to pay may not be there.Colleen Schnettler 8:38 Right. Right. Well, and the cool thing I think about the foundation I've built with this is this thing can I mean, I'm not changing anything yet, I remember what you said about features having to sit on the front porch. But what I can do with the foundation of what I build is like pretty much limitless in terms of like file sharing.Michele Hansen 8:57 Yeah, cuz I think the the question for you is, you know, do you want to go on a sort of pay as you go model, which it sounds like the big competitors do, even if it's a subscription model, where they're basically pre paying for a certain number of credits, that then don't roll over? So do you want to do a subscription model with limits? Or do you want to do a pay as you go model? And I think the big questions there are, what are your customers currently paying somebody else for? And then also, what is their usage look like? Is there any way you can model out what their usage on another competitor or doing it themselves would be? versus like how much that would even cost you? I mean, of course, looking at what it costs you to provide a service is a very rudimentary way of developing pricing and most people would not recommend going that way more of a value based way of pricing, but I think it's helpful to at least know what that is. Just so you know what your floor is for providing the service.Colleen Schnettler 10:09 Yeah. And it's interesting because as I've been thinking about this, you'd almost and this isn't, I'm just throwing this out there, it's almost like, you pay one time, I think that to give the person the most value, like you pay one time for the software, and then you're just paying a maintenance fee or something to keep your stuff in Cloud Storage. I don't know, I just don't know. Because ultimately, I'm repackaging cloud storage in a pretty box. And cloud storage is cheap. But I look at what these companies are charging for their uploaders. And I'm like, wow, they're charging a lot. So that's all really good business advice you just gave me. But can I just like, throw a price tag on it to try it? Michele HansenSure. Colleen Schnettler I mean, that's kind of what I was saying. And then, and then see if anyone uses it. And from there, I will just kind of see what happens, and adjust accordingly. Michele Hansen 11:07 Have you looked around on like Reddit and Twitter and other places for people complaining about your competitors, and see if they have any complaints about the pricing of them?Colleen Schnettler 11:18 So I have done that. But I haven't looked specifically -- when I first started building this, I look specifically for complaints about the service. But I did have not looked for complaints about the pricing structure. So that's a great idea. I like the idea of not going pay as you go. I like the idea of a fixed rate. Because I think one of the frustrations with Amazon is you never know how much your bill is going to be.Michele Hansen 11:42 You can also do that more transparently than Amazon.Colleen Schnettler 11:45 That's true. That's true.Michele Hansen 11:46 Like we have a pay as you go model and people who don't have a lot of usage really like that, because they only want to pay for exactly what they use. And they don't want to feel like they're leaving money on the table by paying for up to 300 credits when they only use 257.Colleen Schnettler 12:03 Yeah.Michele Hansen 12:05 So if you find on Reddit, for example, people talk about using these services and what they're paying for them, I would encourage you to reach out to those people and say, What would you prefer instead?Colleen Schnettler 12:14 Yeah, I think this is a good, this is a good, this is a good circle back to trying to find people again, like I know, I did this in the beginning, which gosh, we've had this podcast for 16 weeks now. So something like that, so quite a while ago. But this is a good time to circle back, I think. And I also I really think I still really think my space is going to be might be in like the no code space, because it feels like there are not, there's not a lot of options in that space. So I will look for those people who look for people using web flow, see what they're doing. Now, I'll look for anyone using Upload Care, or Cloudinary, or any of these other services now and kind of see see what they're saying.Michele Hansen 12:53 Sounds like a plan.Colleen Schnettler 12:54 Awesome. So in addition to this, trying to get trying to actually get this available off Heroku and having to figure out pricing, I have continued to read the book we've been working through, which is StoryBrand, which is about for those just joining us story brand is basically a marketing book, it's about clarifying your marketing message. So customers will buy your stuff. And I'm on chapter seven, and I have theoretically established myself as the guide, the customer is the hero. And now I need to provide a plan. So this seems pretty obvious. This was not eye opening in any way the author talks about. He says making a purchase isn't a characteristic of a casual relationship. It's a characteristic of a commitment. When they place an order, they're saying, I believe you can help me solve my problem. And I believe it's so much I'm willing to part with my hard earned dollars. So he talks about literally making a plan minimum three steps maximum six steps. And, you know, uses that that quote he uses frequently, which is if you confuse, you lose. So yeah, so I made a plan. And the idea is, you know, you make it simple enough that you were trying to alleviate confusion. That's the goal here. So my plan, my four step plan is one, sign up for the service to add the JavaScript snippet to your website, three, use the new file in the cloud for x. Okay, now that I'm reading it to you, it sounds really bad. Okay, let me try that, again, sign up for the service. That's the first thing you do to you add the JavaScript snippet to your site three, your user adds new files in the cloud, but that's not really something you do. So I'm going to remove that from my plan, deleteMichele Hansen 14:46 That is part of them getting value out of it.Colleen Schnettler 14:49 That's true, your user your user uploads files.Michele Hansen 14:54 And if you go with a pay you go model, which you know, I know you may not, if they don't using the product, then you don't get paid. Which is a nice alignment between you and and the customer.Colleen Schnettler 15:07 This is interesting, I had not really thought about pay as you go. This is definitely. It's definitely interesting. I'm going to think more about this. But your points valid, like if no one ever uses it. Maybe you never have to pay anything. That seems like a win win, right?Michele Hansen 15:21 Wasn't there a step four?Colleen Schnettler 15:23 Yes, step four, was access your files in the cloud. So that's my, that's it. That's all that's my process. Like that was a whole chapter make a plan.Michele Hansen 15:33 So, so last week, thinking more about about pricing a little bit. So you were undecided on whether to go with free trial versus free tier? And if you're going free tier, what that free tier was? And I'm curious if you did any more thinking on that?Colleen Schnettler 15:54 Yeah. So I think because of what I do, I feel like a free trial is not really fair to the customer. Because you're really, I mean, my service is sticky. If you use it, it's a pain in the butt for you to migrate off of it. Because you have to go and you have to download each file, and then you're gonna have to put the files somewhere else, and then you're gonna have to changeMichele Hansen 16:14 That's the sign of a really promising business, when it's hard to leave it.Colleen Schnettler 16:19 You cannot leave. So I feel like a free trial, like, I'd be annoyed with that. If after 30 days, they were like, you have to pay me now because that's a huge pain. Although now that I'm saying it out loud. What after 30 days, I sent you an email, and it was like, here's all the files your users have uploaded. I mean, maybe there's a way to do it without being a jerk, like a gentle way to give them a 30 day free trial. And if the users you know, and then you could be like, hey, you've uploaded one gig here, all your files. And maybe I, I don't know, maybe I could let them stay at that level. But be like, if you want to continue using the service and upload new, maybe what I could do is I could keep their files, so they could still access them. So I'm not totally screwing them over. But then I could say, Oh, this is interesting, what if I ended but if you want to continue to service, now you have to pay for it, versus just a free tier, which is like you get five gigs of storage for free. You can have forever and ever and then when they surpass five gigs of storage? Um, I don't know.Michele Hansen 17:28 That's interesting. So free trials work well, when using the product requires legwork from the person who is signing up for it. And basically, you're punting the point of payment until the user has so much sunk cost going into this in terms of their time that they're like, okay, fine, I'll pay you. So like, a great example of this is TurboTax, where you go through the whole thing of uploading your W2s and your mortgage and whatever. And then it's like the very, very last step that they're like, oh, by the way, this is gonna be $49. And you have the file in three states and as an extra $19. And you're like, ah, fine, I just want this to be over with.Colleen Schnettler 18:14 Yep, that's me, been there, done that, TurboTax.Michele Hansen 18:15 So that can be really effective model where, you know, it sounds like with your plan you just made for the user requires four steps for them to go through in order for them to get value out of it, because they're not going to really sort of see it in action until their user has uploaded something. And then you can see that, and that requires work on their end. Yeah, I think that could. That could be interesting. And and when you have talked about Cloudinary, and whatnot, you've mentioned how you've only used the free tier for those companies and never paid them. And then when they if you have a site where they would actually need to pay somebody, you just build it yourself. Colleen Schnettler Yeah. Michele HansenSo I wonder if you would sort of bias towards people who wouldn't have a lot of usage by having the free tier bearing in mind that we have a free tier and I'm a huge believer in them, but like anything, it it has to make sense based on the context. Colleen SchnettlerRight. Michele HansenAnd I think what you described maybe makes sense that a free trial instead. Now the question is, if you're going to go with a free trial, why a month, why not? Five days, 10 days, 45 days?Colleen Schnettler 19:29 Okay, So to your point, I can Oh, you're right, there is a it's not a hard setup, but it's not no setup, either, right? You're gonna have to spend 20 minutes, 10 minutes, depending on you know, how good you are adding the JavaScript snippet and saving the URL, generally not hard. But yes, there is by and they have to do something to make this work on their site. So they're not going to see value in it until their users start to upload files. So for them, how long is that going to take? Or maybe Could you do a free trial up? I mean, I guess I can do whatever I want. But I could also do it up to like a certain file limit, right, like file like storage, like you've had 25 users upload files. Mm hmm.Michele Hansen 20:10 Yeah. I think that would make sense. Like, or, you know, a certain storage limit. Colleen Schnettler Yeah. Michele HansenI wonder if people would be adding this during the development phase. And so it may actually be six months or something until a site goes live? Colleen Schnettler Ooh, yeah. Michele HansenBut if they can do you know, it's, I mean, well, then we're talking about a free trial, really, or not at frontier, but a free tier, yeah. Which is, you know, up to a certain low storage limit, it sounds like the cloudinary limit may be too high, almost. And then they have to switch over, which basically means they can use it for free during the development and demo period.Colleen Schnettler 20:49 Yeah, I kind of like that I like I like a free tier up to a certain storage amount. And I could do it based on the file size you're allowed to upload. So you know, maybe on your free tier, you can only upload three MB files. I like that, because I feel like that gives people enough buy in to see you know, and then when they want to add video, or when they want to add some kind of ginormous file, they'll be tied into my software, and they'll be willing to upgrade it. Because they'll already like it, like I go back make having this conversation makes me go back to think about why I didn't like the Cloudinary solution, because a lot of people recommended it to me. And I just found that it was so painful to use. And the widget was so ugly, that at that time, and this was years ago, we were like, we're just gonna build it ourselves. So I feel like to decrease the barriers to entry, which is what I'm trying to do might as much simpler. And I think it looks nicer. Like maybe that will be that will be good like that will draw people in and then they'll use it and they'll see it's easy to use, and then they will continue to use it. And then they'll want to add big files, or then they'll have a lot of users that want to use it or something like that.Michele Hansen 22:00 So to recap, we just bounced from whether you would have a free portion at all to having a time limited free trial to having a free tier and then having a free tier with a you know, with a storage limit that is not time limited.Colleen Schnettler 22:21 Yeah, I have this all under control. Can you tell?Michele Hansen 22:23 So I think when you go find people on Twitter, or Reddit or wherever that may be asking them about what they're using, this is a really important thing to ask them. Like, you know, if there was a service that was much prettier, and was much easier to use and get started with. And you got up to I don't know 25 megs of storage. And then you pay for an after that, like, what do you think about that? Or would you prefer something that is you get up to 25 or so you get up to 50 Meg's of storage, but for one month, and then you have to start paying for it after a month and ask them why do you like that? Why don't you like that? What do you wish it would do instead? Yeah,Colleen Schnettler 23:07 I think developers are so bad about buying software. I mean, we do but i, this throughout this process, I have run into this over and over and over, where I'm like, I could build this thing that makes your life easier. And the developer I'm talking to is like, Yeah, but I could build that. And I'm like, yeah, of course you could, but you don't have time, you don't want to. Anyway, I The reason I thought about that is because when I first tried this on Reddit, everyone was like, Oh, yeah, I just do this ridiculously complicated process to do it myself. So I will look specifically for users, for people who are already using a different service, just to kind of see where they are.Michele Hansen 23:46 And something we talked about a while ago is people tend to be much stingier with their own money. Colleen Schnettler That's a good point. Michele HansenThe developers can build a client for this directly, rather than it being them having to eat it as overhead as part of the project. I think that would make people much more willing to pay for it.Colleen Schnettler 24:08 That's a really good point that I have totally forgotten about. But I know with my clients, they would every single time, rather pay for a service that's $20 a month and takes me 10 minutes to implement versus paying me five hours or three hours or whatever, to do a custom solution that then they have to maintain or I have to maintain, it's still cheaper for them in the long run. And it's easier for them to if they if they are on Heroku it's easier because then they have one bill so they don't have to pay an AWS bill and a Heroku bill and whoever else bill.Michele Hansen 24:39 So the tricky thing about this, then is that you not only need to have a pricing model that is acceptable to the developers who are installing it but also to their clients. Because what you just said was, the client would rather have something that they pay $20 a month for then XYZ and so then The question, also to figure out is, is a client comfortable with knowing that there will be a range of costs that it will be somewhere between five and $25 a month? Or would they prefer knowing that it is always going to be $20 a month and that $20 a limit is is much higher than they would ever possibly need? And they know exactly what that cost is going to be?Colleen Schnettler 25:23 Yeah, that's a good question. And I don't know the answer to that question. But my intuition is telling me they'd rather have a fixed cost. That has been my experience with clients is they even if the fixed cost is $20, a month more expensive, they'd rather have a fixed cost.Michele Hansen 25:41 I would verify that against these people, you're going to go out and find in the wilds of the internet.Colleen Schnettler 25:47 Oh, yay.Michele Hansen 25:49 But that's it that's worth thinking through is, okay, you have a free tier with a certain limit. And then, rather than having pay-as-you-go, you have monthly subscription plans on top of that.Colleen Schnettler 26:03 Yeah, that's what I think that that's kind of this conversation is leading me down that path. I like the transparency of that. I like that you know exactly what you're getting. But I agree that like I need to talk to people. You think only people who are paying for something or everyone who's I mean, everyone's doing it. But do you think I should focus on people who are currently paying for a solution?Michele Hansen 26:25 Maybe try to find half and half. Okay. And you know, I say that saying? Try to find five people who will talk to you. So you need two and a half people on either side. Um, you know, maybe try to find, you know, two or three people who are paying for it, and two or three people who aren't paying for it, but who expressed that this is a pain that they do, and they have this wildly complicated process that they do. Okay, who experience some amount of pain with it.Colleen Schnettler 26:52 Yeah, yeah. It's just like, I was thinking about this as I'm trying to make it available. You know, as I'm working on it, I'm just like, no one's gonna buy this. Man. Michele HansenOh, don't say that. Colleen Schnettler And the thing is, people are paying for services like this. And I think it was just like, that's part of this process, right? Like, you build something, I'm still excited to use it. And it was kind of cool. Because like, one of my clients not knowing anything about this podcast, or anything about what that I've built this thing. One of my clients asked me, he was like, would it be so great if they could just dropped their file there? And I was like, Yeah, what I can do that for you in 10 minutes, it was awesome.Michele Hansen 27:30 And that is the hero moment. It really was the, the product making you the developer, the hero, that is the moment you want to get all of your customers to.Colleen Schnettler 27:42 And that like, that's literally why I built it. Because I was like, Yes, people ask me this all the time. And I'm always like, Oh, it's gonna take a couple hours. And this drop zone code isn't compatible with this drop zone code, and I gotta set you up on AWS. And it's a whole freakin thing. So that was like, a really happy moment for me when he said that because I was like, Yeah, like, it's gonna take me 10 minutes. Sweet. Michele Hansen That's amazing. Colleen Schnettler Yeah, it was cool. And that's going to wrap up this week's episode of software social. We'd love to hear your feedback. You can reach us on Twitter at @softwaresocpod!
Raising and Setting Prices
Colleen SchnettlerHey Software Social listeners! Colleen here. For their first time ever, MicroConf is putting on a SaaS podcast awards. Michele and I would be so honored if you would nominate us at saaspodcastawards.com! And here's today's show.Michele Hansen 0:02 So I think I already know what the title of this week's episode is going to be.Colleen Schnettler 0:08 Oh, that's funny, because I don't know, please tell me.Michele Hansen 0:12 See, normally we don't decide on the title until I've loaded everything into Transistor and cleaned up the transcript and everything else. But I think today is going to be the pricing episode.Colleen Schnettler 0:24 Ooh, that sounds fun. Michele Hansen 0:27 Because you were saying last week, do you want to talk about pricing today? Right.Colleen Schnettler 0:30 I did say that. But I don't know if I'm quite ready yet. Michele Hansen 0:34 Well, it's been on my mind a lot this week. So there's actually can't it kind of came out of a conversation I was having on Twitter yesterday. And just talking about specifically talking about what to do when you raise prices, and and how to treat customers who would win with you for a long time versus business needs to change pricing models or, or increased prices. And then, of course, something that happened recently, which is a company that many of us use, raising their prices on us. And so all of this got me thinking about ways of dealing with prices, and how pricing model itself can be an advantage over competitors, especially entrenched competitors. And then also how there's a lot of advice about pricing. And I think all of that needs to be couched in the specifics of your own business and your own understanding of your customers. So the context here is that stripe is raising prices on their subscriptions product. So basically, you can use, you know, stripe to create your payments. And if you have products set up as subscriptions now, previously, their subscriptions API was free. And when it was announced, I think in 2018, or so the announcement they sent out was basically that it was going to be free forever, and just included in the product. And then this morning, um, this just showed up on Hacker News. I mean, maybe it was yesterday that the post actually went up. And I just saw today that they're now going to be charging a point 5% fee on any subscription, which doesn't sound like a lot. But if you extrapolate that out to making, you know, 1000 hundred thousand a million a year like that, that adds up very quickly. And I think something that's really rubbing people the wrong way is first of all, they told people at the get go that this was going to be included and that they weren't going to charge for it. And second of all, that we never even got an email about it. And we're just finding out about it on Hacker News. Yeah. And so this actually ties into a conversation I was having with Simon Bennett of snap shooter on Twitter yesterday about this sort of idea of quote, unquote, grandfathering pricing. And I say, quote, unquote, grandfathering, by the way, so I know this is the term that people generally use. But we stopped using that term this summer. Because the concept of grandfathering, that the term comes from, after the Civil War states instituting voting policies that said you could only vote if your grandfather could vote. So which basically disqualified former slaves and their descendants from voting, and I always thought this was just like, one, like, one way the term had been used and wasn't like the origin of it. And so like, you know, once we found that out, we we change the term, how we talk about it to be loyalty discount, which I also think really more communicates what you're giving the customer and makes them feel good about themselves, rather than thinking about relatives and stuff like that. Um, so anyway, so So Simon was talking about this, because he's saying, you know, I've left so much money on the table by by giving these loyalty discounts by by not raising prices on on old customers, and we're sort of, you know, talking about, but you can get value out of that and other ways like, like as a SaaS company, it's so valuable to have long term, customers who will reliably renew like that, you know, they're already on boarded with your product, the support volume is much, much lower. They like you, they're presumably happy with your product. You know, those are the customers we reach out to when new customers are looking for our customer reference, which especially happens with bigger companies. So, so I want to bring like two different resources that kind of helps us think about this, but then also how we think about them differently. So one of those is an article by Amy hoy, which I feel like I referenced her so much on this podcast that like we have to have her on.Colleen Schnettler 5:09 Aren't you guys friends? Michele Hansen 5:11 Like Twitter friends? Yeah, I think we like met at MicroConf. Um, yeah, through the twitterverse. So this article, such a great title, One Weird Trick to Raising your Monthly Price Without a Customer Revolt, which is basically what Stripe is looking at right now. And you know, Hacker News is full of people saying, you know, should we migrate off of stripe like up like, all this kind of stuff. So in this article basically goes through, like, you know, you see a company raised prices, there is a revolt, it scares you away from raising prices. The problem with that is that companies may need to raise prices, especially the situation you're in right now, where you may pray something right now. And then it turns out as you learn more about your customers, and what their cadence of needs are, and, and how you know how their behavior needs to be matched with a pricing model, you may need to change things in six months, or a year from now or two years from now, whether that's the actual pricing model itself, or the price levels. And so how do you do that in a way without making people revolt. And so one of the key points she makes, you know, here is that it is possible to raise prices without a revolt, like you don't have to be afraid of that. And there's a good way to do this, I think the way stripe has done it is not a good way, which is raising the prices on something people are already using for free, and then not telling them about it, those are two strikes against you. One of the most popular ways of doing this, which I think Bugsnag is doing. I think I think we're just talked about this a couple weeks ago, and we I mean, Mathias and I, is that you basically get locked out of new features, so you can keep your price for forever. And I think Basecamp does this as well. But you don't get new features, you don't get new functionality. And so you know, eventually, you know, the percentage of their actual product that you're using is lower and lower and lower. But if you're only doing simple things with a product, and you're happy with the price you're paying, and you don't need more, that can be a really good thing. Another thing is, you know, like designing new plan levels, so you change those those different levels. And, but I think the really important thing to hear, to think about here, you know, your job as a founder, whether that's one who is just starting out or, or like me, or someone who's been doing this for 20 years, your most important job as a founder is to know your customers better than anyone else. This informs the kinds of features you build, how you structure your products, and how you price them. And all of that informs, you know, the kind of service that you're delivering, and and most importantly, how you price that product. And so as you learn more about your customers, you may find there are more optimal ways to do things and ways that are they're ultimately friendlier to them. You know, for example, I think we've all been in situations where there's a company that's trying to make something a subscription when you really only need it once. And it's just super annoying. You're like, I only need this one, I don't need a subscription. Like why, like, why can't I buy this without a subscription? Or, you know, I only need 100 units of this, but I have to buy a subscription and the minimum level is 300. And like, why am I paying for more than I'm using like, like all those situations, like as a customer don't feel good. And so what we try to deal with pricing is to not put customers in those situations, but at the same time balancing that with the needs of the business and the fact that you know, if we gave everything away for free or priced at very, very cheaply, like we would go out of business and then we would not be serving our customers right so like there's a there's a give and take there.Colleen Schnettler 8:55 So how do you think a company like Stripe, which has some of the most competent developers and marketers screwed this up so badly?Michele Hansen 9:05 I I don't know. You know, I I will say you know, having some been someone who has worked in larger companies that have raised prices with varying levels of customer communication I mean it's a difficult thing to to message and certainly being the one responding to the customers is not a fun situation to be in so I do commend Patrick Collison for like jumping in on this Hacker News thread and just opening himself up to the firing squad that is Hacker News commenters because let's be real like Hacker News commenters are mean the the most brutal commenters out there like if you're gonna destroy someone send Hacker News comment there's after them. Um, you know, so I mean, it's it's tough, like raising prices is always tough, but I can talk through how We think about it because we raised prices last year.Colleen Schnettler 10:03 Yeah, I would love to hear that I, especially in my situation where I'm just kind of making up a price when I start that seems reasonable. And I may have to change it down the line, depending on my customer needs and my business needs.Michele Hansen 10:17 So actually, I guess I should start with in the beginning, so. So from the launch point, we got our pricing model, basically by copying it from competitors, because they offered 2500 for free per day. And we're like, okay, that's just, that's the baseline. So that's what we have to offer. Like, why would anyone switch from a competitor to us when we were less generous, though, actually, one of our competitors does have a less generous return. But anyway, so we took that, and then we're like, what our problem is, is we need to be able to pay for 5000 a day rather than just 2500. So we gave it a pays you go model. And I don't remember how we actually set the price for pay as you go Come to think of it. I think we originally set it as $1 per thousand, I have no idea how we actually came to that price, I should look through my notes and try to find that. I don't even know if I did some back of the envelope math on Okay, we've got these two tiny little digitalocean servers, you know, one server with one database server for $20 a month. And you know, this is how many customers we would need. So then, so we did that for a while. And then but I think the real The thing that really kicked off our growth was introducing the unlimited plan in May of 2014. And it's funny and I say Unlimited, because one of the go to resources on pricing that basically everybody should reference is Pricing Low Touch SaaS from Stripe Atlas guides written by Patrick McKenzie, which is just probably one of the most referenced pricing articles for bootstrappers, along with Amy Hoy's writing. And in that article, he says never sell unlimited anything, which I find so interesting, because we actually do sell something unlimited. And I think, and this is one of those things where you know, your job as a founder is to know your customers better than anyone else. And it's also to know your business better than anyone else. And if you have competitive advantages that other people don't have, like, you've talked about how you're switching and storage providers, because they give you an operational cost advantage, rather than using AWS, like if you have those advantages using them. And so in May of 2014, we had a customer come to us and say, you know, I love your product, but with your pricing model, like that doesn't really work for us, like we need to do a ton of geocoding Is there any way you can give us something that's like, that's higher volume. And what we ended up doing was like, you know, we can just, we can just allocate one server to you. And then you're going to get your own instance of the platform, and we manage it for you. But your API key, rather than talking to the public cluster, is just only going to talk to that server. And then you're just responsible for basically not DDOSing yourself, you know, using DDoS in a very broad term here, but basically not, you know, not overwhelming the server. And so your limit is the capability of the hardware. So we introduced that unlimited plan. And I and we set it at 750 a month. And I think we set it there because at the time, one of our major competitors enterprise plan was $10,000 a year for I think 100,000 a day. So you're still getting a lot more, but they had a much better quality product. And so we wanted to price it below it. Because again, I think we didn't have very much confidence in the beginning in terms of what also was somewhat realistic that our product was really not very good. And so we wanted to price it accordingly. It's much better now. So, so once we introduced that we you know, we learned how much companies love flat pricing, like they just they larger companies really don't like variability and pricing. And that was a huge, huge engine of our growth was introducing that plan. But that price stayed at 750 a month, for a long time, even when our competitors were charging much more for it. And we actually had customers say like you guys should really charge more because it makes you seem not as legitimate that it's so cheap. Like it seems suspicious. And we're like that's really weird. And then we had other people say it too, and we're like, I guess maybe we should figure out raising prices. But something it was really important to us was those customers who've been with us for a long time. We wanted to make sure that they were Still getting the best price for it. And I think that really comes out of my own experiences, you know, you know, talking about the stripe situation like being on that side myself in the past and having to defend a pricing decision, maybe even when that I didn't make personally but having to be on that side of messaging it like, I saw just how destructive it was for people's belief in a company. And, and their opinion of it and how they're like, you know, I've I've been a subscriber for 20 years, and I'm not getting the best price, the new people coming in the door are like, Whoa, like, What is this, and we got that all the time. And so I really didn't want to replicate that experience. And so we decided was that people would, we're gonna raise the price to $1,000 a month. And, but people who had an active subscription, they could keep the 750 price as long as they had an active subscriber subscription. So that meant that if anybody who was currently an unlimited subscriber as of November of 2019, was this 2018, I think was 2019. We did this feels like forever ago now. So they would keep that price as long as they had an active subscription. But talking about like cadence, like, sometimes we have people who are, for example, academic researchers, who like need to do one really big batch once a year. And so they'll just use it for one month and then cancel, they would pay the higher price because it wasn't a continuous subscription. And that's also really why like framing it as a loyalty discount, because we're rewarding them for seeing with us. And if they stay with us, then then they will continue to get the best price. But nobody, you know, nobody who comes in new is going to get that price. And I think it's just really important, psychologically to reward that, because when people see that new customers are getting a better price. And then for a product they've used for a long time. People get really upset, they get justifiably upset. But it's it's a tough thing to message. Absolutely.Colleen Schnettler 17:16 So are you guys gonna move off of Stripe, what's your take on the whole situation for your business?Michele Hansen 17:22 We had a conversation about it this morning. Um, I think the thing to weigh there is it's not just the extra money that we would be paying Stripe for this. There's also the opportunity cost involved. And as a two person company, our time is our most valuable asset. And to spend three weeks now migrating over to a new payment platform or simply migrating off of the subscriptions API and handling more of that in house, there's all that time upfront plus there is all the time on an ongoing basis, um, to to manage all those things that stripe is managing. So I think we're thinking about it, there also seems to be if you get to a certain volume, that stripe will negotiate with you on on the rates so I'm kind of unclear on what those levels are and whether they will actually negotiate with you. I'm not totally where I stand on it right now. Though, that is a very strange way of thinking about it. But this is my own personal mental accounting when there's a product that I pay a lot of money for and I actually like like the product or I recognize that there's this lock in there right because this is like you know the amount of time to switch to a new payment provider creates substantial moat for stripe and that's it that's a barrier to entry for you know switching off of some switching costs. That's the word I'm looking for. So I'm I sort of I comfort myself by buying their stock. So unfortunately stripe is not public yet. And neither is intercom those are probably the two companies were the most locked in with it wouldn't be the most hassle to switch off of them. They're not public yet but I will buy their stock when they're public. But it's kind of thing like you know Progressive Insurance for example, like you know, we buy Progressive Insurance and I also own their stocks I'm like you know what I feel like I'm like whenever I get a dividend notification I'm like I'm getting a little bit of my money back It's so weird. It doesn't make sense and and my friends who are into the psychology of finance will find that hilarious but that but that's how kind of how I think about things like even actually today I was looking at I was doing some analytics on payments. So I was trying to map out the path to becoming an unlimited customer and like you know how long are people pay as you go customers are most people pay as you go customers first or they jump right to it like just sort of figuring some of those things out. And, and I was also emailing people who should switch to unlimited because they will save money. And it turned out that one of those companies on the list was like a law firm that exclusively works with Virginia, local governments to make sure they're capturing all of their revenue. And I was like, This is hilarious, because I've been going back and forth with our local Virginia government on taxes, and it's like, okay, you know, and I pay them a lot in taxes every year. And I'm like, I'm getting a little bit of that money back, because this person is a vendor to them is paying us and it's this beautiful cycle of the economy, right? where, you know, money is kinetic and wants to be moving. And money moving is a beautiful thing. So, so that's kind of how I think about it. That's, I think that's where I will end up going with this. But it remains to be seen on Hacker News, it did seem like they were willing to negotiate with some people and at least extend the free nature of the subscriptions API until the end of 2021. So I think we will, we will reach out to them about that. Because I mean, it is a great product. Like it's a it's a really, really good product. And as someone who personally dealt with managing your own merchant account, and dealing with the banks, and and all that stuff at an old job, like that was such a headache. And stripe takes a lot of that away. And if you know, our most valuable asset is our time, stripe does give us a lot of our time back. And maybe I just have to suck it up that they are pricing for it after I mean, Patrick Mackenzie's whole thing is charged more in the works for them. So I can't really blame them. Yeah, I think that the communication on it is a you know, so some people say, you know, act as if your actions could end up on the front page of the New York Times tomorrow, or, you know, act as if they could be blowing up on Twitter or on Hacker News. I think that's the modern version of that.Colleen Schnettler 22:12 To me, it seems like the real problem here is that it used to be free. And we we being the people who use it, were under the impression it was always going to get rolled up in the entire in the price. And that has changed. I mean, I think it's a great product, but I literally put someone on the subscriptions API three months ago. So that is frustrating.Michele Hansen 22:34 Yeah, and then there's a whole thing about it was free, or you know, you were you were paying through through the other fees already paying stripe. And now it's something else on top of that, like, so when we launched our Geocodio Maps product. And I think this was 2018 or 2019. And we like we already had a free sort of like basic preview map that we generated for people for a long time. And then we made this more more advanced mapping platform that's sort of like you could call it like Tableau-light, specifically focused on maps. And we went back and forth quite a bit on how do we price this, how do we integrate it with the product, like, we really didn't want to take away that thing that was free for people. Because we didn't want them to exactly have that feeling of Wow, this used to be free, and now you're charging me for it, but it hasn't changed and, or even if it has like, I only wanted the basic thing like that was fine for me. Like we really wanted to respect that some people only needed the basic map. And people who wanted something more advanced could go somewhere else and pay for that. Now that's created all sorts of other headaches for us about integration of the products, and we'll probably be integrating it more into the product in the future. But still keeping some amount of free because I think once you release something, especially if it's free, it's really hard to claw that back. Which is why you know, we were talking about this last week or two weeks ago, you're talking about what your your free tier would be, and all that kind of stuff like that is a really, really important thing to get right in the beginning. Are you doing are you doing free tier are you doing free trial? Like what are those? What are those amounts? And also, what are you getting out of that right? Like basically what you get out of a free tier is not having to do as much marketing and sales as you would if you had to pitch everybody upfront before they can use the product. But being very deliberate about what those free tiers are because as as we're seeing with stripe if you make something free, and then you charge for the exact same thing later, or you charge for it plus a whole bunch of other people, features that people don't need. People are going to get upset? Yeah, rightfully so I think. So you mentioned that you kind of have thought a little bit about pricing, but not enough to really talk about it. So let's talk about.Colleen Schnettler 25:13 Okay. So I looked at a few players in this space, the ones I'm familiar with are upload care and cloudinary. cloudinary is one I've actually used before. And it's very popular in the rails community, they have a pretty generous free tier. So their free tier, you get 25 monthly credits, and a monthly credit is described as 25,000 transformations, or 25 gigs of storage, or 25 gigs of net viewing bandwidth. And I assume you can mix and match these three aspects of their service in any way you want to hit that 25 k number. That being said, it's really hard to know if you're going to go over that number or not. I mean, that is pretty confusing. If you look at that, like how are you supposed to have an idea of if you're going to exceed that with transformations? If you're allowing your users to do transformations and different file sizes? I'm not sure.Michele Hansen 26:15 A combination of the How do you like Do they have examples. It's like your user uploads an image and then they decide to rotate it and and change the colors and inverted and everything.Colleen Schnettler 26:28 They might, it's kind of hard to tell from this pricing page. And as I mentioned, at the top of the episode, I didn't really do my homework on this yet. So it might be somewhere in this documentation. But at first glance, it is challenging to see exactly how that's all gonna stack up when you actually put it in your application.Michele Hansen 26:49 Like, do you know what your customers are actually paying for this like, like when you as a developer have built a website for people, you've said that you've used some of these services? Do you know what they're actually paying?Colleen Schnettler 27:02 I don't, because I have used the free tier of cloud Neri but for file heavy applications. And I have worked there's one company in particular, and we were really file heavy, heavy. We rolled it ourselves. So our costs were the developer time to set up the system, the upload system, and then the cost of storage in AWS and then the cost of, you know, egress bandwidth, those kinds of things as users use the service.Michele Hansen 27:35 So it sounds like what you're competing with, then is the developers time to build something themselves plus whatever they would be paying s3 for the storage.Colleen Schnettler 27:48 Yeah, I think that's reasonable. And I think that's a more realistic comparison to comparing them to these big players like the upload care or the cloudinary. Because I don't provide any of those extra services like the transformations in the AI and the filtering. So yes, I think it is more accurate to describe it as the developers time. And whatever the you know, current storage and CDN fees they're paying right now,Michele Hansen 28:17 it is important to note that competitors can be as much companies as they can be processes. And, you know, a competitor can be the amount of time someone would take to do something themselves. So that talking about that pain reminds me of our ongoing segment here, which is calling read story brand. Yeah. And so talking about the pain the user faces and the problem they're going through, makes me curious for what you read and StoryBrand. This week, and how it relates to your nascent business. Colleen Schnettler 28:57 Yeah, so this week, I read the chapter on guides. And so the author of this book talks a lot about how everyone is the hero in their own story, a lot of brands come in, and they position themselves as the hero, they're going to solve all your problems. But that's not what you should do. You as a brand should position yourself as the guide. So your customer is the hero, you are the guide, and you are showing them the way that's going to lead them to a solution. So the author talks about two characteristics of a guide. One is empathy, and the second is authority. And he says that three things every human being wants most are to be seen, heard and understood, which pretty much also sounds applicable to parenting and life. I think that's pretty reasonable. Right? So we talked a little he talks a little bit about empathy. Let's start with empathy, because that's the first thing you have to do. So how do you show empathy? Again, is this a course on business or a course on life? I don't know. Anyway, a few examples he gives an empathetic statements are we understand how it feels to, nobody should have to experience like you we are frustrated by. So first step is establishing empathy for me specifically for my brand, I think frustration might be one, like you, I am frustrated by having to do this annoying process over and over and over or like you, I am frustrated that this is just such a pain. And then he talks about authority. And he distinguishes between authority and competence. Because you don't want to come off as a braggart, you don't want to come off as a no at all. I don't want to position myself as well, you used your root API keys, that was stupid, you know, I don't want to position myself as a jerk, like, I want to position myself as competent, empathetic and competent. So you'd want just the right amount of authority, not so much that your customer feels belittled. So he gave four examples of how you could you could do this. One is testimonials. Two is statistics. And who doesn't love statistics? Michele Hansen 31:09 Most people, but go on...Colleen Schnettler 31:11 three awards, and four is logos of companies that have worked with you.Michele Hansen 31:16 Yeah, like I mean, numbers are very convincing. Unless they're too good, though. Like, like our NPS score is stupidly high. Like, it's somewhere in the 90s. And at one point, we had it on our website. And people were like, I don't think that's real, like, Where is that and I can make sure we get like an NPS site that like people that actually like feeds it, and like it says it's clear. And then we're like, we'll just, we'll just take this statistic off, instead, do logos and testimonials.Colleen Schnettler 31:47 So when the author talks about positioning yourself as a guide, he talks about the first impressions, both with people and with businesses. And he says, a great first impression is made by doing two things, the first thing someone is going to do when they meet you, or when they interface with your business is can I trust this person? or business? And can I respect this person or business? So the empathy we're showing early on in this process, leads to trust. And so our goal as a company is my goal as a company, I guess, is to guide the customer or the hero to the solution. So I am not the hero, I am the guide.Michele Hansen 32:33 Yeah, your business is Mr. Miyagi. And your customers, The Karate Kid. It's already reading that book. Like after reading that book. I was like, Oh, my gosh, I'm seeing this whole, this guide, Hero motif everywhere.Colleen Schnettler 32:49 Yes, I'm seeing it in movies. I'm seeing it in successful businesses. I'm seeing it everywhere. So something else I wanted to talk to you about is my software product, which has finally reached beta status and Heroku, which is really exciting, because now it's available on the general Heroku marketplace. But it's kind of sad, because it is not available for sale, the way it works is I have to get 100 users 100 before I can actually try and charge for it. So that is like a great milestone that I'm excited about. But what I want to talk about is what I should do now. And I'm going to give you a multiple choice test. Okay, so what should I do next, a more tech stuff. I want to build more stuff. There's another feature I want for myself that I want to build me make it available as a standalone product, like on its own website and its own world. See do marketing on Heroku. So focus on my Heroku marketing page d a lot of choices sorry, D make available on another marketplace like a CloudFlare or II II, II make a marketing website.Michele Hansen 34:07 So I think those options were a focus on Heroku be focus on non Heroku plot like D platforming it entirely. Option C was further integrating with Heroku like something about Heroku right, and option D was putting it on cloud flares platform. And then option he was building a marketing website. Did I get that right?Colleen Schnettler 34:38 Yeah, that's pretty close.Michele Hansen 34:40 Okay, so stop building at this point. So I think like, at least at this point, you're focusing on you're focusing on distribution and marketing, which is really good. Colleen Schnettler 34:50 I knew you were gonna say that.Michele Hansen 34:53 Colleen, you need to do some selling first.Colleen Schnettler 34:55 I know you're gonna say that.Michele Hansen 34:57 Right and You know that this whole thing about Heroku not being able to charge for it until you have 100 customers, I think that could be dangerous for you, because it allows you to punt on pricing. So just to challenge you, I'm gonna say option B, or the C or D, whichever CloudFlare, right? Like, depending on how important you think channels are, like those channels are going to be for your distribution, like, do you think you can have your own distribution? Or do you need to rely on a marketplace, selling it somewhere else, which will force you to develop pricing, also to like, get people paying for it, which is both the most financially rewarding part about it and super motivating, which will encourage you to keep working on it. But I think it's time to step away from Heroku for a little bit and try to actually go out and sell the damn thing.Colleen Schnettler 35:58 And I know that just because someone uses a free product does not mean they're going to pay for it. So is anyone actually going to pay for it?Michele Hansen 36:05 Exactly. And you need to figure that out now before you spend more time on the tech.Colleen Schnettler 36:12 Yeah, I think that is excellent advice. And you're absolutely right, because I've kind of been in this perpetual state of not being able to charge for it. I've really haven't had to sort out any of these issues like we'll be we'll pay for it. How do I find people all the normal issues when you're trying to sell a product? So all right, that's my goal. That's what I'm going to work on. And that's going to wrap up today's episode of the software social podcast. You can reach us on Twitter, at @softwaresocpod. Thank you for listening. Send me all your good vibes.
Who's the villain?
Michele Hansen 0:01 Can I ask you an honest question?Colleen Schnettler 0:03 Of course, I love honest questions.Michele Hansen 0:05 Did you actually get any work done this week?Colleen Schnettler 0:09 Oh, my goodness. So it has been very challenging. For me to focus this week, I've really struggled with it. How about you?Michele Hansen 0:19 Between, you know, all of the checking Twitter and phone banking and everything else that has consumed this week. I have gotten some things done, though. Weirdly enough, things that require deep thinking and are complicated and less so tasks, which is really surprising because for me, as an ADD person, I tend to find that it's easier for me to churn out tasks when I'm having trouble focusing rather than thinking through something complicated, but instead, my brain is doing the opposite. And everything is just crazy this week.Colleen Schnettler 1:01 Yeah, I have found that I did better this week, like a deep work as well. I mean, I ended up working almost every night this week. And it was partially because I felt like it, but I think a lot of that too, was just like to give me something to focus on, so I didn't have to worry about everything else going on.Michele Hansen 1:21 I admit I've been spending more time on hobbies this week too. On Tuesday afternoon, I ended up spending a couple of hours sewing masks with my daughter because I just I couldn't be anywhere near a computer. Like I knew that if I was at my computer, ostensively replying to emails and everything else I would be looking at the news constantly. But so that thinking I did do, is was working through this big, complicated thing that we're dealing with right now that some listeners have asked us about, which is this whole moving to Denmark thing.Colleen Schnettler 1:56 That's big. Yeah, it's a big deal.Michele Hansen 1:58 Yes. And a big deal of that is how it relates to the business, both how it relates to our US business, and then setting up a business here. So one of the big things to figure out is like, obviously, our business address needs to change, right. So before it was our house, it can't be our house anymore. So one of the tools we're going to use, which seems like a lot of people who are running remote companies who are US citizens, but outside the country, or even non US citizens running from outside the country, a tool called Earth Class Mail, which I hadn't heard of until six months ago and has been so awesome. And you basically just get a mailbox, you can send things to. Some of them are PO boxes, some of them look more like a real address, you know, like a suite number instead. But the big thing we're trying to figure out, which relates to the mail, too, is our incorporation in the US and whether we have to change that.Colleen Schnettler 3:00 Yeah, this seems like a really complicated topic. So your mail, your Earth Mail, is that a PO box in Denmark that you physically access? Or is it just like a fake address to use on business documents?Michele Hansen 3:12 So it's a virtual address that we use to receive mail both personally and business in the US. So we're having...Colleen Schnettler 3:20 But where does the actual mail go? Where does the physical mail do it? Michele Hansen 3:24 So it goes to a PO box in DC, and then it actually gets shipped to Earth Class Mail's facility in Beaverton, Oregon, and then they scan it. So we basically get all of our mail as email. So whenever someone sends us a letter, or even like, we can even deposit checks like that, like it'll scan the contents of an envelope and tell us when there's a check in it. And then we can deposit it. And it you know, I mean, it takes like a week or two, but it's like, other than that, what would we do? So currently, that's going to DC, but our business is registered in Virginia. And so what I've been trying to figure out is do we need to stay incorporated in Virginia? Or do we need to go through the process of dissolving our Virginia Corporation and then reincorporating in another state that is more friendly for remote businesses?Colleen Schnettler 4:19 Okay, first question, do you have to be incorporated in the United States at all?Michele Hansen 4:24 Yeah, I think for a lot of the services we use, like in our insurance and everything else, like it makes sense to probably -- what we're going to do is have a US company, and then just have a Danish subsidiary, but basically only for payroll purposes. That is at least according to our Danish accountants, though, our conversations with them have been somewhat delayed because our accountant and her entire family got COVID.Colleen Schnettler 4:45 Oh!Michele Hansen 4:46 She's doing better now. Thank God. Yeah, it's been. Yeah. Yeah. We didn't hear from her for a couple of weeks. And we're like, why? And then, oh, my gosh, and we felt like absolutely terrible for wondering why she hadn't followed up with us.Colleen Schnettler 5:00 So my first question not knowing a lot about taxes or business and corporations, why wouldn't you incorporate in a state like Florida that doesn't have state taxes? So that's income tax, isn't it?Michele Hansen 5:10 Yeah. So that's, that's personal income tax. I mean, so so this, this decision matters. What you decide to do is different based on your situation, because we're in Denmark, and we're going to be end up paying so much in taxes here that we're not going to have any US tax liability, it doesn't really matter a lot, we still have to file taxes, but you know, that the tax rate here is, you know, starts at 42%, basically. So, um, so actually was the way I looked into this, right. So, so in Virginia...Virginia has two really annoying taxes for businesses. So the first one is the business tangible property tax, where they will tax every piece of equipment that you use for the business. For us, that meant desk chairs, and desks and computers and everything else, and you have to pay sales tax on those every year. However, we won't have any physical presence in Virginia. So that won't be a problem. The other one we've been trying to figure out is, do we have to pay the what is called the B Paul tax or the business professional, an occupational licensing tax, which was instituted to pay for the war of 1812. And is still here? Colleen Schnettler Wow. Michele HansenYes, yeah. It's actually it's really funny. Like, looking into the into all of the rules for that tax. It lists out all the possible Aki occupations. And town crier is listed as one of the possible occupations. Wow, he just says a lot. And the most grating thing about that tax is that it's a gross receipts tax, which means it's based on total revenue, so you don't get to deduct your expenses from it. Now, of course, the tax rate is very low as because it's such a broad tax. But this is also why economists hate this tax. Because it's so broad and was supposed to be for a war 200 years ago, and it's just stuck around magically. Trying to figure out if we would still be liable for this, if we're incorporated in Virginia. Seems like maybe not. But just in case, I've been kind of running down some rabbit holes of, to your question, should we change our state of incorporation, which is a process. And so I consulted a couple of different places for this. And one that I found kind of helpful, is the service called First Base. And I guess before I talk about it, I should disclose that they are part of the Ernest capital portfolio, which is we are investors in it. And that's really the only way I know about them. But basically, they help people abroad set up companies in the US and they have this helpful little tool that you don't even have to sign up for that you figure out like, which state does it make sense for you to sign up to establish your business. And the two they recommend is either Delaware if you are planning to raise money and issue stock, and if not, Wyoming, for ease of doing business low, you know, low overhead, low fees, can do things online. Stripe also has a service that does this to Stripe Atlas, I believe they only incorporate you in Delaware. And I guess I should also disclose that Stripe owns Indie Hackers, and we're now part of the Indie Hackers, hackers Podcast Network. So lots of disclosures there. If you're still with me, congratulations. So, um, so yeah, so I've kind of been looking into that, um, it seems like maybe we won't be liable for that War of 1812 tax in Virginia, if we don't have a physical presence in Virginia. But I want to make sure that we don't have to, you know, file some paperwork every year saying that we're not liable for it. Or the other thing is with Earth Class Mail, they don't have an address in Arlington, where we are incorporated. They only have an address in Norfolk. So do we have to change to Norfolk? Like I have to... I don't I don't I don't really know. And the thing is, is when you Google anything about this, and then you add the word remote to it, any Virginia government website it it's just stuff comes up about remote learning, and it's not like they're, you know, this is kind of the thing like with so many things about being a bootstrapped company, like we're so weird in so many ways, like, like we defy a lot of the conventional ways of doing business, right. Like we don't have a ton of assets. We don't really have employees, we don't really issue stock like we don't raise money, like we do all of this stuff that businesses are started tend to do and governments tend to assume that businesses do. We don't do any of that. And now we're also running it from abroad, but it's the same company. And so I need to figure out that. Yeah, and so for some reason, this is what my brain has been like, this is a more pleasant thing to think about than the election. Colleen Schnettler 10:21 I don't know, Michelle, this whole conversation makes me want to take a nap. And not cuz I don't love you. But like, because it sounds so horribly boring and painful, like to sort this out.Michele Hansen 10:31 But it is less painful than biting my nails about the election. Colleen Schnettler 10:37 So that's true. That's true. You've been able to channel your energy into something productive. That's good.Michele Hansen 10:42 Yeah. And that just the weird thing about it is there's not doesn't seem like there's a ton of resources out there on converting from a work from home remote within the country business to a remote from out of the country business. I haven't really found any good resources on that. So I mean, if our listeners happen to know any, I would love to. I would love to see them. Because it seems like most remote companies outside of the US are established outside of the US from the get go, rather than transitioning. Yeah, it's kind of a weird thing.Colleen Schnettler 11:22 Yeah, it's funny, because one of the things you said is the way your business is structured is so different than the way the government assumes businesses are structured. But the way your business is structured makes perfect sense. You actually make money instead of just take other people's money, right? You don't raise funding, you are two people who are married, who sell a service and product that people buy, like, it feels so simple. You have like a basic business model. And our system is not set up in any way to support that. It's just blows my mind.Michele Hansen 11:52 I hope maybe in 10 years, someone will listen to this and say, Wow, can you believe that businesses, you know, had to deal with that and governments were so behind on the whole, you know, remote work and and bootstrapped companies angle.Colleen Schnettler 12:08 I've been thinking a lot about your future, Michele. And I feel like we're gonna be referencing this podcast when you run for Congress. And like ten years.Michele Hansen 12:15 I don't think I can run for Congress now that I've moved abroad. I think they'd be like nahh, she's not loyal enough.Colleen Schnettler 12:21 Yeah.Michele Hansen 12:23 They'll call me a socialist for being in Denmark. Colleen SchnettlerYeah, they would. Yeah, yes. Michele HansenYeah. Um, enough about politics. So are you out of are you into beta yet? Okay.Colleen Schnettler 12:37 So for those just catching up, I am releasing my first software product, and I am releasing it in the Heroku marketplace. So I did a lot of work this past week, unfortunately, I am not out of so in the Heroku marketplace, you first are an alpha, and then you progress to beta. And once you're in beta, you can get up to 100 users. I am unfortunately not in beta not from anything I have done wrong, just because they have taken for forever to review my documents. So they Heroku has to come in and review the documents and approve the documents before you're in the add on marketplace. So unfortunately, that has not been done yet. But I have reached out to them. And they promised me you know, promised, but they assured me they were going to get right on it. And it should be done relatively quickly. But it hasn't been bad. Because with some of my first, I have 10 initial users. And I've been working through some things with some of my initial users. So I actually got a lot of work like, like big changes kind of architecture changes done this week. And as we've talked about before, I don't want to over architect something that maybe no one is going to want. But it is something I want, so it needs to meet certain standards. And so what I actually did this week is I worked on splitting up the domains for security. So before I was serving files from the same domain, as my application was on so now I have a completely different domain to serve the files from. So that is going to help with security possible security issues. And I kind of rearchitected the file storage. So I think two weeks ago, we talked about how I was thinking of moving to lower cost storage. And at the time, I was unsure if it was worth the pain to move but you and I talked about it. And as you know this will be a commodity it yeah can win on price. So I moved to a lower cost storage provider, which also enabled me to use a third, a different storage provider for backup. So now when you upload a file, it goes to this primary storage provider, which is cheaper than AWS and it backs up on a different a completely different storage provider in the background. So I feel better, I feel good about good about it, like I feel good about it. Because now, you know, I have your file, I have a backup of your file, I'm serving your file from a new domain, I got, you know, serving your file through a new CDN from a different domain. So I feel like architecturally wise, I feel solid with what I have. So I'm happy about that. So yeah, so it's been a lot of work on on kind of sorting that out this week. And a lot of little things, too, that I'm just kind of trying to like, kind of knock out as I have time, like, for example, now, something I've really been concerned about is whether I should actually delete your stuff or not. Because if you're my customer, and you say, I don't want to use you anymore, if I delete those files, they are gone forever. So I now have, you know, at least an email that I send you. So when you delete the add on, it'll say, Hey, don't do if you do this, it will delete your files forever. And then I, you know, I haven't set up to send you an email to say, Hey, I'm going to delete your files forever, in seven days, contact me, if you don't want me to do that, just so just things like that make me feel a little more comfortable, as I scale up the number of people that are going to be using it.Michele Hansen 16:13 A couple weeks ago, you had talked about how you were talking to someone who was using the service? And... Colleen Schnettler YesMichele HansenThey were saying how they liked it for images. But they're also excited about it for PDFs. And I'm curious if you also played with the idea of expanding to other file types?Colleen Schnettler 16:35 Yes. So I really, I'm really starting to think this is my win space, because as we've talked about, like, there are really good providers out there for images. And those image providers do all kinds of other fun stuff for you, they'll resize they automatically downgrade this size, they'll they'll let you pick the ratio, you know, I don't do any of that, like that's not really the space I want to compete in, at least not now. So yes, a big reason I wanted to move to this lower cost storage provider was because I'm going to open it up to other kinds of files. And I think those files tend to be bigger. And so I think that's why I think the lower cost storage with a higher limit. So I don't know, I guess next week, we're gonna have to like sort out what plan sizes I'm going to use. Because hopefully by next week, I'll be in beta. But I don't know what that size is going to be. But like, for example, you know, maybe your competitor, lets maybe the competitor lets you upload a five MG file, well, I can let you upload like 100 meg file if I want. So that's kind of kind of something that's been in my mind, too, is allowing like bigger file sizes, so they can use other kinds of files.Michele Hansen 17:45 So it sounds like you've started a little bit to think about pricing and what you're going to charge for this.Colleen Schnettler 17:54 Yeah, a little bit. I really, I really, that is definitely something I need, we need to we need to sort out because, you know, Heroku requires you to get 100 users, which is a lot of users, before you can charge for it. But as you and I have talked about previously, I'm not going to wait on that, like, I'm going to continue to try and get it ready for you know, the open world, if you will, to allow other people to use it. So my thought was all of these file upload services have a free tier. So my my thought in terms of in terms of trying to figure out pricing would be the first thing would be figure out what they're doing, they're being competitors, for their free tier, and exceed that, I guess, and then sort out the pricing from there. Michele Hansen 18:45 I don't think you necessarily need to be more generous on your free tear than the competitors. I'm curious like, like, if I was doing this, I would make a spreadsheet of all of their different pricing. And I would write down like what is their, you know, the company, what is their free tier? You know, what are the different features they have? Like, how do they do their pricing? Is it is it free tier? And then metered? Or is it free tier then bands like so for example, you know, say, you know, so and so for $10 a month and then double that for $15 a month or like or is it pays you go? Or is it does it jump to subscription only, um, I would just see what everybody else is doing. But when it comes to features, I wouldn't say you necessarily need to exceed it. Colleen SchnettlerOkay. Michele Hansen You know, when we launched Geocodio, we set our free tier at 2500 free per day because that's what Google's was. And now there's is like 40,000 per month. So it's so, so we didn't purposely exceed that because really the help for us was being able to to pay on a pays you go basis. But I would also be curious to know, like people who are using those services like, are they also happy with that pricing model as well?Colleen Schnettler 20:08 Yeah, because I think one of the things I've noticed, and as a user of some of these services, at least the image services, there's like a, you get a certain number of credits. And then each request you send to their back end is a credit. But it's very confusing, because for example, to upload a file is so many credits, but then if you're going to resize a file, like that, or if you want to run a, you know, a filter on a file, because all that hits their API, so they charge you these, it's really hard to figure out in my opinion, so they charge you like these credit this, like weird credit based system. So one of the things since I'm not offering any of this resizing, filtering stuff, like one of the other ways I want to compete is just simplicity, I think like it's going to be, you know, we're not going to have to guess how much it's going to cost, you're going to know how much it's going to cost every month.Michele Hansen 20:56 And, you know, in a commodity space, competing on pricing, simplicity can really work. Especially if, if some of the competitors are trying to do you know, their pricing with obscurity, basically, and try to make money relying on people not knowing how much they're going to be charged, which I, quite frankly, I think that's pretty, pretty scammy business behavior. And you're above that. And I think people appreciate it when you treat them like adults, and you say, here's what it's gonna cost. And we recognize that the other folks are trying to pull the wool over your eyes, but know exactly where you're gonna be charged. That can be a competitive advantage.Colleen Schnettler 21:46 Yeah, and so I think that spreadsheet is a great idea. So I think that'll be something I'll work on this week to chat more about, because hopefully, like I said, it'll be in beta next week. And so I'll really be focused on how to get it out there. And what I want to charge,Michele Hansen 22:02 it might be interesting to simulate with all of their complicated models, like what it would cost with a competitor versus what it would cost like, and then kind of think through what that would cost for you, or how you might charge for that. Because that can also be you're basically writing the bones of your marketing copy saying hey, like, if you've got so so many files, and they get resized, and all these sorts of things, you would be paying x with our competitor or y with other competitor, but you're gonna pay, you know, x minus 25%, or whatever, with us.Colleen Schnettler 22:38 Yeah, that's a great idea. I will definitely do that. Speaking of marketing, and marketing copy, I've been working through the Story Brand book, and this week was chapter two. And so chapter two is about finding the villain. And he describes the villain is like, the thing you know, the thing like that's against goes is in your customers way of what they want. And something I really pulled out of this chapter was, companies tend to sell solutions to external problems, but customers buy solutions to internal problems. And that really struck me as we're all humans, we all have these like internal problems that motivate us, even though we might verbalize an external problem. And so we talked about step two in this process of clarifying your copy and clarifying your message is deciding what or who is your villain. And so, we talked about what makes a good villain. So one was a villain is the root source. Frustration is not a villain. For example, frustration is what a villain makes us feel villain should be relatable, he said people should immediately recognize it as something they distain villain should be singular, you can only have one. And then of course, villain should be real, like you don't want to fear monger. So I've been thinking about who my villain is, and I really want it to be AWS, but I don't want to call out, right, like AWS, the bane of my existence. Just kidding, you guys are great. Um, so I don't want to like call out AWS specifically. But when I think about my villain, in my in this story, and my customer story, I really think it's like a cloud storage provider, because they're hard to use. Their pricing is confused, confusing. Just like they're hard to use. There's so many ways you can screw up in terms of like permissions and and file sharing and object habit 10 excuse me, and object tagging that I feel like they're a good villain.Michele Hansen 24:54 And you're the villain creates something that people are willing to pay for, which is the villain causes people to spend all of this time and mental energy on something and people want to have that time back. And so by reminding people of the villain, you can remind them what they would rather have, which is not having to deal with all of these super complicated things and go through the gymnastics of somebody else's pricing to figure out what they're going to be charged for something and how to set it up. Colleen Schnettler 25:30 Yeah. Agree. So one of the things he talks about in the book is how people have three levels of problems. And the reason a lot of companies aren't successful is because companies focus on only one level, they focus on the external problem. So the external problem is the obvious problem you're trying to solve. But people also buy things to solve external problems, internal problems, and philosophical problems. So I have tried to take that and put that into what I'm building. So for me, the external, this is what I'm thinking, at least the external problem people are facing is they need a way to allow their users to upload files, save those files and serve them quickly. The internal problem is people feel intimidated by setting up drop zones, file, drop cloud storage, they want a simpler interface. And there's so many choices when you're trying to set this up. It makes them feel insecure. So the internal problem is they actually feel insecure, or imposter syndrome in their ability to be a good developer. And philosophical problem is you shouldn't have to be a DevOps engineer, to set up file uploads.Michele Hansen 26:39 I like it. I can tell you spend a lot of time working on that.Colleen Schnettler 26:41 I did, I was real proud of myself. Because I always struggled to work on this kind of stuff. Because as we've talked about a lot, like as a developer, I just want to keep tweaking the code and keep writing tests and just keep coding. So I'm really, really trying to take the time to work through this book and to like, get ideas and hopefully start implementing them. Because there's no point in having a product if no one's going to buy it. Michele Hansen 27:06 I will encourage you to think a little bit more on that second, the internal problem, yeah, really honed in on the developer who is somewhat new to this. And I think that user is there. It strikes me that your motivation for creating this product. You are not creating it because you were a novice developer who couldn't figure these things out, you're creating it because you are an extremely experienced developer who's having to do the same problem over and over again, and you were frustrated about the amount of time you were spending on a repetitive task when you felt like your time was more valuable, or it could be used in more valuable ways. And so I would encourage you to think more about that type of user as well. I mean, you may have multiple types of problems that you're solving for people.Colleen Schnettler 28:03 Yeah, that that is absolutely an excellent point. And I didn't occur to me, but you're right. The reason I'm building it is because I'm sick of setting it up over and over and over and over. Yeah, so that is definitely I guess, my internal problem, there would be frustration, like frustration and loss of time and just annoyance, like it's not fun to do slightly different. But the same thing for every client.Michele Hansen 28:29 I mean, that's kind of similar to what we do, right? Like our tagline. And this could definitely be improved, is hassle free geocoding, right, like, in a way that you talk about AWS sort of B or major cloud providers being the villain. With how complicated it is, I think we're kind of in a similar space where the terms of service and pricing and usage restrictions, and just general usability of our competitors is such a hassle for people, that we don't necessarily call out the villain directly. But I think we absolutely are speaking to that internal problem that people are tired of the hassle of dealing with other options. I don't know if we really hit it a philosophical problem, though. I'll have to think about that one. I guess sometimes we do, like it, you know, you shouldn't have have to have a GIS degree to figure out geocoding. Other companies are making this overly complicated. It doesn't have to be so complicated and you just want to get the data and get on with your life.Colleen Schnettler 29:36 Yeah, like it.Michele Hansen 29:37 That wraps up this week's Software Social. We'd love to hear what you think! You can tweet at us at @softwaresocpod!
Founder/Business/Lifecycle Fit (aka "The Feelings Episode")
Michele Hansen 0:00 So last week, Colleen, you said something to me that really seemed to resonate and jump out at a lot of our listeners. And that was that you aspire to have a business that is in the position that our business is in, but that you don't want our lifestyle.Colleen Schnettler 0:23 Yeah, so I felt a little bit like a jerk when I was editing the podcast. And I heard myself say that, and I almost cut it out. But it's true. And I'd love to discuss some of that with you. Because kind of my vision is what I want as a solo founder is pretty specific. And you guys seem to be in a whole different place than what I envision my success looking like.Michele Hansen 0:49 Yeah, and I would love to talk about that. And I'm so glad you didn't cut it out, because it was echoing in my head all weekend. And I really appreciated your honesty about that.Colleen Schnettler 1:02 Okay, if you say so. Still feel mean!Michele Hansen 1:06 I appreciated it. And it really seems to resonate with a lot of people listening to that. The fit of founder and business and lifestyle is so important. And I think you this is something that is worth diving into, because it's not just about the founder and the business fit, having the expertise and the sort of know how and you know, environmental knowledge and whatnot to make a business happen. It's also about having a business that fits the kind of lifestyle that you have, or that you want. And you know, Lord knows I hate the term lifestyle business. Right. But that is one of the things about this is you basically get to choose in a way, what kind of life you're going to have. And I think that applies even if you have a corporate job, right? Like, do you want a lifestyle where you are flying to a client site four days a week and barely see your kids? Like, that's a lifestyle, that's a lifestyle choice. Do you want a business where you're home, but you are maybe managing email over dinner, which you may do as a solo founder, or you may do working in a corporate job somewhere. I think this is really worth diving into and the fact that like my business, and then the way we run our business may not be something that you want. And in an environment where we're conditioned to look at other people. And there's this expectation that if people are successful, everyone wants to emulate what they do. That's not always the case. And we need to leave way more space as a culture and as a group of people that one person's success is not somebody else's success, and may even from a certain perspective look like failure because of compromises they're making in order to get to that success.Colleen Schnettler 3:20 Sure. So my first question for you is, I feel like Geocodio kind of built up around your family. And it seems like, you know, you guys got on a trajectory where things moved pretty quickly. After you got a foothold in the market. What do YOU want? Like if you could go back and and think about how you would design your business that fit into your life that provided you the opportunities you you want, like, what would that look like for you?Michele Hansen 3:53 That's a really interesting question. I've never thought about that. I think partly because, you know, I wonder if we had changed something, maybe things wouldn't have worked out as they did. Like, there's certainly things along the way that were difficult. But I don't know if, if I would choose to not do those things or do things differently. I will say that we -- Yeah, we it has grown up around our family. You know, we launched the business when our daughter was four months old. A big reason why we even got started launching our side projects in the first place is because we had the bejesus scared out of us looking at the cost of daycare. I mean, it's more expensive than college in a majority of states. And you know, being pregnant and realizing that got us us supposed to be like, we can't be spending our weekends watching Game of Thrones anymore like we got to start launching stuff because...ColleenYeahMichele Hansen 4:45 this is this is you know, we're gonna be pretty close to paycheck to paycheck without something else happening, you know, and, and I remember just like us talking to each other and being like, we can kill it at work, but we're Still not going to get the kind of raises we would need in order to comfortably afford, you know, $20-25,000 a year in daycare alone, plus all the other expenses that go with having a child. Like, it's like we knew it would be expensive, but what can we just, you know, until we started researching it, like, we just didn't have a concept for how bad it would be. And, and you know, that first year, like, I don't even know how much we made, but I think it was barely enough so that we didn't get charged a maintenance fee on our business bank account. So not very much. So we see we wasn't at the point where we're really making that, you know, quote, unquote, like, daycare level amount of money for a while. Um, yeah, our family absolutely grew up around it. And I think I probably would have given myself more permission to not feel like things had to be handled immediately. In terms of like customer support, things like that were happening at night or dinnertime. But at the same time, for every time that there was something blowing up on Intercom that we need to deal with during dinner, there was something blowing up on Slack at our regular day jobs that was also getting in the way of family life. I don't think our business has gotten in the way of family life more than a, quote unquote, full time job would in fact, I think it's much more flexible, because it means we can take time off or you know, snow days aren't as much of a big deal, of course, I mean, lockdown was just awful for everyone. I mean, I guess now we sort of stare it down again. But I feel like I'm rambling.Colleen Schnettler 6:45 So try this on for size. So you've done that. And now you're in this position where you have said to me privately and on this podcast, like growth is not really a primary motivator, you don't want to be acquired, you don't really care how quickly you're growing. So what do you want now? So you kind of done the hard like trenches work to get you in a comfortable position? Like, are you are you happy with the status quo? Like, do you have ambitions to if it's not to grow to work less? Or what are you thinking now.Michele Hansen 7:20 So we do have goals, they're just not other people's goals that you would normally hear about, I guess. So I set some goals last year after doing my sort of semi-annual customer analysis from from a high level of our data. So basically, I, I look at all of our customers like a portfolio. And then I evaluate that based on industry and company size. And some other factors, just basically just like an investor would a stock portfolio, and try to see how it's balanced, you know, making sure that we're not getting too much of our revenue from one individual customer, or even from the top 90%, or the top 80% of customers. And so trying to manage for different risks that way, is more how I think about goals. We will have goals based around industry. So for example, this time last year, maybe like last summer, looking at our portfolio of customers, I realized, like 20% of our customers were in real estate. And I felt like that was too much. And so, no, it wasn't purposely going to try to get rid of those customers or anything like that. But instead, I was like, you know, I would like to focus on some industries that are maybe more stable than real estate and try to focus my marketing efforts and sales efforts on industries that are more stable than real estate. So we made a conscious decision to try to focus a little bit more on banking and financial services, and also on health care as well. And so that was a goal we had of getting the percentage of financial services customers up to a higher percentage. But it wasn't it's not a growth, overall revenue growth goal or a user goal. It's the percentage of our revenue and I'm always keeping an eye on things to see. Okay, let's make sure that, you know, no one customer is more than 1% of revenue. That's something that's very important to us that requires growth. Because also very often we have ARPU growth or observe average revenue growth in those, those top 80% customers. But we're not necessarily chasing a number around number of users signing up per day or per year, or credit cards being added to account or even really even the number of high level customers specifically sort of on a user level. It's more on a portfolio level that I have these goals.Colleen Schnettler 10:02 Sure. Um, can you talk a little bit though about like, your personal goals and how they tie in when we talk about like business founder, lifestyle fit? Like, what do you want? Michele Hansen 10:17 Did you just ask a question about feelings, and I answered about numbers?Colleen Schnettler 10:20 Yes, that's exactly what happened. That's all very interesting. But that's definitely not what I asked you.Michele Hansen 10:28 Our goal is to keep doing what we're doing as long as we can. Colleen Schnettler OkayMichele HansenWe are happy with the kind of life that we have, we feel very grateful that we run our own business, I don't think it would be a fit for everybody, you know, in terms of lifestyle, like the number one thing I get feedback on about lifestyle, is people saying, "Oh, my gosh, you work with your spouse? How is that even possible? We would kill each other? like, Wait, how is your marriage?" and I'm just so uncomfortable, whenever that happens. And like, I feel like you're projecting a lot of your own marriage on me, and I'm not quite sure how to react to this. Because for us, like, like working together as a dream. Colleen SchnettlerYeah. Michele HansenLike, there's no drama, you know, I mentioned like, you know, slack blowing up on at night, like, who hasn't experienced that we have none of that, like, we have none of that, like interpersonal drama going on. And it's awesome. But it's also because, you know, we're a fit together as people, and if we weren't a fit together as people, and that wouldn't work. And I think both of us handling this, like we, you know, we know to trade off and, and sometimes it's, Hey, can you handle this, because, you know, I need to go get our daughter from school, or like, one of us is making dinner and the other one is responding to someone, and we can balance things off of one another in a way that I think a good marriage should be able to have, you know, can you feed the baby now, because I need to go do this other thing, like, there's always that give and take, and maybe we just negotiate that, like particularly well. But we really like working together, we think that's the perfect optimal scenario. And there's always things that can be improved. You know, I talked about customer support last week a little bit. One of the reasons why we hold on to that is we actually enjoy it, like I like talking to people, I like feeling like I'm helping people, I like the amount that I learn from that, like, I get so many ideas for how to fix our product, or how to make something easier for people or just learn things from talking to customers. And that's in a, in an interview setting that's in a chat setting as well. It's probably not ideal to be responding to that kind of thing at 10 o'clock at night. And I'm working on, you know, managing my own need to, to do that. But yeah, what we want out of our out of all of this is just to keep doing this. And so I guess, you know, I mentioned those portfolio level goals I have really that goal is stability, right? Like I you know, my first week of college was the 2008 financial crisis. Colleen Schnettler Wow. Michele HansenSo that was incredibly traumatic, like, like everybody walking around, and being like, Well, my college fund is gone. And knowing we're gonna graduate into a recession, like economic stability, and calm is so important to me. And that is much more important to me, than, you know, getting, I don't know, millions of dollars from being acquired, or having some growth numbers that would impress people like those kinds of things aren't important to me. What's important to me is stability, and stability for our family. And so making decisions that lead to more stability is how we tend to think about things.Colleen Schnettler 13:55 Yeah, I think, kind of what was you were talking last week, what prompted my comment was for me, I went into consulting to give me more flexibility, right, like, so I am never on call, like, I don't work with people that want me on call. No thanks. And I have a lot of autonomy in who I work with. And all of that has been great. And so for me, I've always thought that the next step with the product business would be even more flexibility, right? Like, oh, you make money while you sleep because someone's buying your product. But it's interesting, because as I talked to more and more solo, or couple founders seems like there's a lot involved in off-hour support requests. I mean, you're not the first person to say this, that you're working at 10 o'clock at night. So it's just kind of an interesting. It's it was a really kind of interesting thing for me to think about like okay, right now. I have a great situation with client work. Everyone's pretty chill. Like I said, You're not allowed to call me in the middle of the night. No one has my phone number. I don't check Slack -- it's not on my phone. Like it's pretty good. And so I wonder is as I make the shift into like product based business. It'll be interesting to see how that changes. Now, to be fair, when I was growing the consultancy, like, in the beginning, I was hustling, like I was working all the time, I would work my normal job during the day. And then I would work till 10 o'clock every night. I was exhausted. Maybe I did that for 18 months. And that was worth it to put me in the position I'm in now. And I'm just, it'll be interesting to see if like, I grow a product business. And it's like a lot of hustle up front. And then I mean, really, my goal is to work four hours a day, like, that's, that's kind of where I want to be maybe six, and spend the rest of the time doing whatever I want. That is my appeal that in the autonomy is what appeals to me in a product business. But it'll be interesting to see is like, I go through this process, if that actually materializes.Michele Hansen 15:47 Yeah, having truly passive income that you don't have to do any active work for, I think, the dream of a lot of people. Colleen Schnettler Yeah. Michele Hansen The only situation I really seen people actually get that is, you know, when they have a portfolio of dividend paying stocks, but even then you have to worry about, you know, the value of them going down, and then you get less from the dividends, and you have to research new ones. So there's work involved there. You know, I also, like I will admit, like, I am definitely a recovering workaholic. And I don't say that to be glib, like, I used to work a lot at night and on weekends, because I was, you know, trying to show what I was capable of, and trying to prove to other people that I was capable of more responsibility and doing more things, and so hungry for, I guess, a sense of approval, right. Colleen Schnettler Yeah. Michele Hansen And it was so scary to walk away from being in a corporate environment where, you know, you're getting that kind of feedback and criticism all the time and having performance reviews and almost like an academic environment where you're getting graded, to going to one where you are working for yourself, and there's no one standing over you telling you how good you are, and aren't doing -- that was terrifying at first. But then, you know, it was liberating, because I realized I didn't have to get that approval from other people. And I didn't have to work all weekend anymore to show that I was capable of doing the caliber of work that I thought I was capable of. And so now, when I find myself working on the weekend, like it's pretty rare, and but I really don't mind, because that is the price for having the freedom. That is the price for not having to impress somebody, and to show them what I'm capable of as a human being. That is the price of our family getting to go on vacation whenever we want, or getting to, you know, live this life where we have literally just picked up our life and move to another country. Colleen Schnettler Yeah. Michele Hansen And yeah, there's definitely been complications, but not as many as we would have. If I had to go get a job somewhere. There, there's always a cost. And I think you could maybe design a business where you only have to work four hours a day. I don't think that's what I want, though. Like I genuinely enjoy working with my husband. And, you know, people always ask us, well, why don't you just, you know, sell the business. And then you can do whatever you want. And I'm like, because then we would have to find another business to start. And that's a lot of hard work. But also like, we we just enjoy working together. Colleen Schnettler Yeah. Michele Hansen And that may not be true of a majority of couples. And you know, we've certainly all heard horror stories of people who worked for couples that should not work together. But that's not the case for us like that, that cost of doing stuff at night or on the weekend. It's worth it. Because as you said, you want the autonomy and you want the freedom. And it seems weird that freedom could involve replying to something at two o'clock on a Saturday. But at the same time, also, I have the choice, like if I don't reply to that, and I decide to wait until Monday, and as a result of that we lose the customer. You know, who might get upset about that? Me. There's nobody else who's going to tell me who's going to say you should reply to that on Saturday. And as a result, you're not getting your half a percent bonus this year, right? Like, that is not going to happen. Like if I decide to not reply to something and then we lose that customer, I am out 100% of that money. And I am the only one you know, or you know, my husband and I -- like we're the only one who decide whether that was an appropriate decision to make. There's nobody else who is lording over us telling us that we should have done something differently. Colleen SchnettlerYeah. Michele Hansen And that is great because I feel like it is a choice to respond to those things. At midnight or, you know, it doesn't so much feel like a choice when you know a database server goes down at three o'clock in the morning and we get the blaring alarm and stuff has to happen, though. How is that really different than having a baby baby? I mean, so it's everything is a choice. Colleen SchnettlerYeah. Michele HansenEverything is a choice. And and yeah, that that autonomy comes at a cost, but to me, the benefits of the autonomy are worth itColleen Schnettler 20:14 well, and also being directly responsible for the amount of money you make, like if you were working, if you're on call at a normal web development job, and you have to answer a call at 2am, you don't get paid extra for that, right. Whereas if you're answering a client and you get a new client, like that's directly impacts you and your business in a very tangible way.Michele Hansen 20:34 You get all of that versus when you are, you know, it's your turn to be on Pager Duty for the weekend, and you have to handle a bunch of stuff. You don't get paid extra for that. Like maybe you can say in your performance review, like, well, look at all of these weekends I worked and here's all the value I led to the company, and then you maybe get a raise or a bonus because of that. But when it's your own company, you can say like, hey, like, because I work that weekend, like I made an extra $3,000. Is that worth it to me? And you can decide whether you want to do that next time. And maybe it is, and maybe it isn't. But you have that full responsibility, and you get all of the benefits of that responsibility as well. Colleen Schnettler 21:14 I think those are all really good points you're making.Michele Hansen 21:17 I think sometimes you don't, you don't really know what you're getting into when you're getting into it.Colleen Schnettler 21:23 That's kind of how I feel.Michele Hansen 21:24 Like I don't know what kind of business you know, as you said, you know, you would love to have a business where you only work four hours a day. I think it would be kind of challenging possible, but challenging to say, going into something and saying I only want to spend four hours a day on this, or I want a business that only requires four hours of me every day. And, and then finding a problem that is solvable in that amount of work per day. And as you're saying, I think it's a fluid thing, where, you know, you said you were hustling really hard for the first 18 months of your consulting, and then you were able to scale it back a little bit. Like I definitely work less now than I did four years ago, when I had a full time job, like plus the side project, like I work way less, and I have way more family time.Colleen Schnettler 22:14 For me when I say four hours a day, I just kind of think when I've been thinking about building a business, and each step I have taken has gotten me closer to independence. And what I value the most as a military spouse with three kids is my flexibility. And I really have built that with the consulting. I mean, consulting has its own drawbacks, because I have different clients who have different needs. And that can be frustrating, but ultimately, I've already built this flexibility into my life. And when I think about starting and having a product business, I really want the product business to reflect that. So I don't mean that like I only want to spend four hours a day. I mean, I want to be able to own you know, to work in a way that like fits into spending time with my kids and my spouse and going on vacation and do these other things. And this in no way like what you're saying, in no way dissuades me, like I definitely can see how you could build your business a different way. I just am interested that you've chosen to build it this way. And it's you know, I think from our conversations, I've learned it because you love what you do. You take great pride in it. And it's it's a really fulfilling endeavor for you. I think, when if I ever get to where you are, I will have structured things differently. So it'll be interesting. Let's check back in five years. But it'll be interesting to see I can see myself just being where you are, and, and just structuring things a lot differently. But I guess that's that's an important point, right? Like, people are different. And people want different things and have different priorities.Michele Hansen 23:43 I think what I'm hearing from you is that you want to be able to work when your kids are in school. And then yeah, and have to work and be able to be with them when they're at home, which is really reasonable and incredibly screwed up that that isn't the default for like work. Like so, you know, being in Denmark now. Like one of the things really struck me is how most businesses you, you know, they don't open or you can't even get them on the phone until 10am. And then they are closed at four. And that is a hard stop. Colleen SchnettlerWow. Michele HansenAnd the school especially for elementary aged kids, like they go until four o'clock. They go from eight to four. And the work day is you know, from from nine to four, or 330. And it's pretty fixed. And there's definitely no differences in that and tons of self employed people as well. But it's really fascinating to me that it's not like well, you know, the workday ends at four but really like we're working until 5:30 like it's fine as it is in the US where it's pretty common to be at work until six o'clock and even then that's like a badge of honor. Colleen SchnettlerYeah.Michele HansenHere, it's like no, everything is closed at four. If you need to hit Handle it during the day even stores close at five, six o'clock. Colleen SchnettlerThat's so weird. Michele HansenBut it's great, right? Like that is like, like you have work time and you have family time. And you're not just spending 16 hours a day exhausting yourself. Right? Like, I mean, this is a fundamental failure of American culture and life right now is that so many people have to have multiple jobs in order to afford life like I mean, what drove us to create our business was we couldn't easily afford daycare, like a basic necessity of having a child. It should be that you can have a job or have a business and work when your kids are in school. That seems like a very, very reasonable goal to me.Colleen Schnettler 25:56 And it's not really attainable in my field, like as a software developer, like, No, you can't show up at work at nine o'clock and roll home at four and then not check your email Slack or whatever the rest of your right like, it's not something our culture here, especially in tech, is not structured in a way that allows you to, that's all I want, right? All I want is to work with the kids are at school and be with the family when they're not at school. But like our our life, here is not structured that way like it, it's just not. And I've been dealing with a lot. I'm glad we're doing this feelings episode today. Because I've been dealing with a lot of feelings, because we're about to have some more financial stress and pressures. And so I've been trying to figure out how I can cover that. And I've been kind of vacillating between, consult more, which is kind of the easiest solution, get a full time job, which is maybe even easier. But to do that, like I'd have to give up side projects, or at least decrease them even more. And oh, man, it's just a lot of trade offs and drawbacks, and each in each area. But I think a fundamental problem here is all of these things I want to do require a lot more than working from eight to four.Michele Hansen 27:08 I am so glad you brought that up. Because I think that's such a common thing of thinking that getting a full time job somewhere, will give you more stability or more income when you know, the thing about bootstrapping your company is that it takes time, right? And so I would sort of think about like, how soon really is this financial situation changing? And is that is it right now? That happens sometimes, but if it's three months from now, maybe you've got a little bit of time to get your business going, maybe do a little bit more consulting, as a padding, though, that's also that's, you know, consulting, you're charging for your time. And so there's a fixed amount of money that you can make in it versus with a product business there really isn't. But, you know, as you said, Your goal is being able to work when your kids are in school, or when they are in front of their laptops at home doing virtual school. And and I gotta say like, that's something I love about the bootstrapped world is these kinds of goals that we have. The rest of the sort of the tech world is very, there's this prevailing ethos that you should always, you know, be hungry and hustling and, like, you should be working 20 hours a day. And if you're not, then you're you're weak and pathetic, and you're whatever, whatever. There are certainly lots of, quote unquote thought leaders out there who will preach at you for not working all the time. And something I love about the bootstrapped world is there are so many people who I get into talking with them and it's really because they wanted to be able to spend time with their families, or they wanted to be able to live in a place where there aren't really any tech jobs, to be close to their family. And so they work from home and they have their own business. And it's like such a family focused avenue of tech that was so unexpected for me being around that very hustle porn sort of sleeve of it that is so predominant, that that goal that you have is maybe even need a little bit more money, having your own business that fits with a sane life.Colleen Schnettler 29:22 It's feels hard to get there. And I feel like with building this product, you're absolutely right. I do have a little bit of time. Man if I could just get this going. And I can. I know that I can but it man it just feels comparing this balancing this a side project that I hope turns into a bigger than a side project with consulting and the pandemic and managing you know, family feels overwhelming right now. And so if I were to make a choice right now, the easy button does seem to be like just to get a job. But that's I, you know, I've, I've read before that, you know, and I've seen this a lot like, people who get what they want, know what they want. And I know what I want, but I'm just sometimes -- The truth is, I think I'm a little too scared to go after it. Michele Hansen 30:24 I'll tell you how we grew. It was just listening to people. We got something out there. And then we listened to people about what they were trying to do. And then we did that. And we asked them, okay, does that work for you? Why or why not? What else you trying to do? You know, you mentioned that you started this out thinking about images. But I think it was in last week's episode, you were talking about how you had people say to you, Hey, this is really great for images. But I also really need this for PDFs. And there's like really nothing for that. Listen to people. Do that. Just slowly build it by getting it out there listening to people, doing something about what they tell you. And then take it from there. And then maybe you'll find something that works. You know, there's no guarantees. But I have found that if people are willing to be open with you about what they need solved, and you listen to them, and you do it, they'll be very appreciative. And they will pay you, especially if it's a frequent pain that they have that no one else is really solving. And so that does take time, that does take evening hours, that does take sacrifices. But hopefully you can get to a point where you're doing something that nobody else is doing, even if it isn't a commodity space that is possible. And having that kind of, you know, income, that that you need and finding a way to negotiate that with your life, and figuring out how your hours fit into all of that.Colleen Schnettler 32:01 Yeah, no, that's great advice. I, I needed a little pep talk. Yeah, that's great advice. And I think that's, that's what I'm really going to focus on as at least for these next couple months. You know, some people I've heard, they're finally successful in their business where they don't have another option, right? Like, like, what it's like, oh, man, like, I really need to this to work because I really need to make, you know, to increase my income. So maybe a little pressure is just what I need, you know, to turn me into a diamond.Michele Hansen 32:31 I think that's a good note to end on. People want to stay involved say what you think about our conceptions of business and lifestyle and product and all of that, please feel free to tweet at us softwaresocpod. We'll talk to you next week.
Vendor Lock-In, Heroes, and Timezones
Colleen Schnettler 0:00 So for those who are just joining us, I am in the process of building my first software business. It is a small software widget that I am trying to sell. And so right now it's invitation only in the Heroku marketplace. So I was sharing this idea I have, and it's a product, with a friend of mine. And he brought up an interesting point. And I don't think of what I'm building as a commodity, right? We all want to feel special. But at the end of the day, I am repackaging cloud storage and selling cloud storage. So we were discussing, moving to a low a more low cost storage provider. And the storage providers claimed to have S3 compatible API's, of course, like it didn't, it wasn't really compatible. So I'm trying to determine if it's worth my time to sort it out. I mean, these guys are so much cheaper than AWS. And there's two big players in this space right now, in the file management space, they can't move to a low a lower cost storage provider, right? They're like entrenched, but if I do it now, then I can just be cheaper than everyone else.Michele Hansen 1:13 That can be an advantage.Colleen Schnettler Right? Michele HansenEspecially in a commodity space.Colleen Schnettler 1:17 Right? So I again, like I don't like to think I'm a commodity, but really, it's like cloud storage with a bow on it. Right? Like, I'm like -- Michele HansenIt's okay to be a commodity. We're a commodity.Colleen Schnettler 1:23 it doesn't feel special. I guess you are.Michele Hansen 1:28 There's some businesses that are commodities. And I think it's just knowing what you are, and then knowing how to compete in that space, right. And in a commodity business, if you have an operational cost advantage over the competitors, even if those competitors are huge companies, then that can be an advantage that you can build on.Colleen Schnettler 1:52 Yeah, and I think like these, these low-cost storage providers, they just released these S3 compatible API's, like last year. So I feel like this is kind of a untapped opportunity is that no one is really, as far as I can tell, no one's wrapping them up and reselling them yet. And they're much cheaper. So AWS, you're looking at point, you're looking at two cents a gig on AWS on this other provider, you're looking at .005 cents a gig, Michele HansenWow.Colleen SchnettlerA lot cheaper. Of course, you know, when you don't have a lot of storage, like I don't right now. It's like, Oh, it's like $5 versus $3. But if I want to really be a storage provider, like this could be a cool opportunity. And I was thinking about the solutions that are already out there are very, very image heavy. And I had been thinking that way, because I approach this problem as an image problem is well, but there seems to be a hole in the market for other file types.Michele Hansen 2:47 Like PDFs, CSVs, and stuff? Colleen Schnettler 2:50 Yeah, there's doesn't seem to be anyone kind of like helping or optimizing for -- Yeah, I mean, someone, the person I was on a call with wants to host static webpages on it, custom 404 pages. So there seems like there might be an interesting hole in this space to handle non image files. And to handle image files at a cheaper price point. I've been kind of thinking is like, I'm like the Southwest of image management, the airline, like bare bones, I don't resize your images for you. I don't give you user crapping on the front end, but I deliver a simple service with no frills. And it's easy to implement.Michele Hansen 3:27 I think that's a good place to start. And you're kind of reminding me of where we started with Geocodio -- even when you said Southwest, you know, my first thought was not airlines. But you know, deserts and our branding from the beginning was Geocodio, rhymes with rodeo and we had all of this Southwest style branding. If you can find a way to be cheaper than everybody else, and be easier than everybody else like that worked really, really well for us and then differentiating into other adjacent categories that are neglected by major providers. And the way someone described this to me once, you know, I was like, "Well, what if you know, one of the big companies add that adds this and then we're out of business?" If you're doing a business, that's $500,000 a year, a million dollars a year, that's not a big enough opportunity for the big companies to go after it. And if there are people in that space who have something they need, and they're not satisfied by the option, the current options, and you can build a business that makes a couple hundred thousand dollars a year. That is a great income for a one person company and not really big enough to be a threat to any larger company so that they might go into your space, it can be a good spot to be in.Colleen Schnettler 4:49 Yeah, that would be an amazing spot to be in. So the only thing I have a little bit of a psychological block here because I have worked on the technical side of this for quite a while now. And now I have to potentially learn a new API to integrate with these third party storage providers. And I'm just like, I started doing it yesterday. And I was just like, I don't want to, like I'm tired. So convince me that it's worth it. It's worth it to do now. Right? Like I should do it.Michele Hansen 5:16 Well, let's talk about the downsides too.Colleen SchnettlerYeah. Michele HansenSounds like your brain is in downsides mode. So one of the risks here is a vendor lock in risk, right? Colleen SchnettlerYeah.Michele HansenLike, if you switch vendors. Colleen SchnettlerYes. Michele HansenBecause they're six times cheaper, if they raise their prices by six times, that creates a lot of risk for you that one of these vendors, raising their prices, or changing their policies, like you are dependent on another company to make your company happen. Now, there's a lot of people who build their companies off of another company's platform. But you're, you're creating substantial risk there.Colleen Schnettler 6:03 But I have the same risk if I stay on AWS, and I feel like AWS is way more likely to raise their prices, because everyone is locked. Not everyone. But they have such a lock on people, right? Because they feel more reliable. I was actually looking at the stats. So my first thought was, maybe these other cloud storage providers aren't, don't have the same kind of uptime AWS does, but they do! People act like AWS has 100% uptime. And they don't always so they just have this reputation because they're the biggest player in this space. But either way, I've got a lock in, right, like I can't, I mean, I can't, I'm going to do a probably a mirror service. So I'll use two storage providers to help but ultimately, my primary storage provider is going to be locked in. I think one of the concerns, though, is these companies. I mean, they've been around for a while, like they're not materializing out of thin air. But as I mentioned, they've only had these S3 compatible API's for like a year. So I'm putting a lot of trust in a company that doesn't have the AWS level reputation.Michele Hansen 7:02 And that's another risk too. Like, we get this question, sometimes from customers too, right, because they're like, why would we go with you over a big company? Like, how do we know you're not just going to shut down tomorrow? Colleen SchnettlerYeah. Michele HansenAnd when I dive deeper into that question, oftentimes something that's driving that fear is, they have integrated a critical vendor, and then that vendor got acquired, and was shut down by their acquirer. And so we used to feel somewhat sheepish, I guess, when we got this question. And in the last couple years or so, we found that it's an advantage to be a small company and say, we're not venture backed, we're not trying to exit like, this is our livelihood. This, this is our company. We're in this for the long haul. And so I would suggest digging into those companies like why have they launched this product? Like, does it, you know, what would you do, basically, if they shut it down, and just think through that through from the beginning. And then also a way to manage that risk is knowing like, this product, it could be a springboard to another product, right? Like, if this product gets going, but maybe gets to a point where it makes, let's say, $10,000, after a year, you can use that money to then invest in something else, if it looks like revenue is declining for this, or there's new competitors in the space that you can't compete with, and you and you can always use it as a springboard to something else and to seize the opportunity now. It doesn't have to be your forever product.Colleen Schnettler 8:49 Yeah, that's great advice. So I think I will take the time, it might, it's frustrating to be so close to like launching something and be like, "Oh, it's gonna take two more weeks, because I have to sort this out." But I think I will take the time to sort it out now, because it's a lot easier to sort out now than to sort it out, you know, a year, six months down the road when I'm storing a lot of data, because then you have to migrate everything. So I will take the time to sort it out. Because I think cost is such an easy way to compete. And if I can compete on cost so aggressively. Like, as I said, like I'm Southwest airlines have file management, right? Like you don't get any snacks. But it's cheaper.Michele Hansen 9:27 Actually, I think they gave out whiskey to people in their early days.Colleen Schnettler 9:29 Nuh-uh! Did they really?Michele Hansen 9:30 Yeah, no, this is a real story. Like in order to get people flying on Southwest I'd like they would something about how they would give them all miniature bottles of whiskey that's actually used to get the perks in the old days. And now it's the big companies you don't get the perks from.Colleen Schnettler 9:45 Isn't it funny how things change? Right? Yeah, the ecosystem has changed. So that's where I am with that. And I want to talk about something else too, as we've been talking a lot about marketing and positioning. I feel like I think my first like marketing thing was Hey, this simple file upload where we do all these things for you. And I listed out all the things I did. And so I've been reading this book Building a StoryBrand, which you recommended to me. Michele HansenYeah, yeah.Colleen SchnettlerYou recommend it to me a couple weeks ago, and it felt like a light bulb reading this book. Because my initial, what do you call it copy? Why do they call it copy? Why don't you just say words. But anyway, my initial copy was simple file upload handles all the heavy lifting of uploading, uploading user files to the cloud, returning a CDN URL for you easy to integrate with a JavaScript snippet for whenever you need the URL. Okay, that basically makes like me want to throw up in my mouth. Um, so I've been reading this book, Building a Storybrand. And he talks a lot in this book about clarifying your message, he talks about how like, he goes through the components of the story. And he defines them as seven components of a story, you have a character, which is your customer, has a problem and meets a guide. And he suggests or says, suggest is not the right word, my product, instead of being the hero, or the character in the story, my product is the guide, my product wants to help the character achieve their goal.So the whole flow, his character has a problem and meets a guide who gives them a plan and calls them to action that ends in success. And so I've been thinking a lot about that, in terms of like, what exactly does my product do to solve your problems. And I read that copy, initial copy I had. And so I've been thinking a lot about that. And really, my product, if I had to distill it down, it gives you your time back. Like that is what it does, it's time. That is the service I'm providing to you. So he has seven chapters. And each week, I'd like to go through a chapter two and tell you kind of like what I got out of out of that chapter. So the first chapters is a character. And the principle number one is the customer is the hero, not your brand. And so I've been thinking about that, as I said, and I'm selling all these things like I can give you my five point, 10 point bullet list on why my thing is great, but ultimately, what I'm giving you is your time. So that was kind of my revelation, as I went through the first chapter.Michele Hansen 12:32 I love that. And I think it would be great to go through it every week, fine. If listeners want to follow along. The book is Building a Story Brand: Clarify Your Message So Customers Will Listen by Donald Miller. We'll put a link to it in the show notes.Colleen Schnettler 12:48 Yes. And so one of the there are a few things that jumped out at me in this chapter one and one was companies tend to sell solutions to external problems. But customers buy solutions to internal problems. And it just kind of like reading this chapter kind of reframed the way I think about people and reacting with people and what drives people to purchase. So when I first thought, like, What am my customers want? My initial before reading this chapter, I thought, well, they want an easy way to add files to their website. And they want to not worry about AWS, and they want to not have to configure their own cloud storage, and they don't want to have to figure out how to connect to the cloud storage. But really, like I said, What they want is they want less hassle and more time. So that is kind of my my workshopping for chapter one. And I will report back next week with what I find out in chapter two. And hopefully, by the end of going through this book, I will have reframed my very cluttered, challenging to understand message. And something that people can actually understand.Michele Hansen 13:49 You going through that just now makes me wonder if there's a way to visualize all of the steps that someone would be going through almost like a checklist of like, you have to do this, then you have to that then you do this, then you do that. And visualizing that and putting down that checklist and instead saying you could do this to manage your images. Or you could just do this and then it's just your snippet, right. Colleen SchnettlerYeah, that's get really clear. Michele HansenAnd it's because you had all of that sense in your copy. But what you really want to get at is, stop wasting time on this thing you don't even want to do in the first place. That takes up a ton of time. People are spending a lot of time on this. And so remind them how much time they're spending on it and then show them that there is an alternative. Be the guide so they can be the hero. Colleen Schnettler 14:39 That's awesome. Yes. So yes. So this week I'm going to focus on as I said, I gotta do some technical stuff in terms of storage, but I'm also going to keep reading this book and kind of focus on how to reframe My message to show people like what I'm really providing and kind of like tighten down my elevator pitch. Michele HansenAwesome. Colleen SchnettlerYeah, so let's talk about your week, what have you been up to with your business and your life?Michele Hansen 15:05 So last week, I sort of mentioned in passing that we have recently moved to Denmark, and a couple of people picked up on that. And were wondering if I could talk a little bit more about what that transition has been like.Colleen Schnettler 15:21 Okay.Michele Hansen 15:22 So, it's been sort of an interesting thing, because we were initially only here temporarily. Or at least that was the idea. But now we're transitioning into staying here full time. And, and so there's been a lot of different things that have come up and trying to transition from being a, I guess, a remote in the US company, like, you know, working from home, rather than being remote from abroad. And, and really, one of the the the biggest struggles we've had there, which relates to work, something I've worked on this week, has been the timezone shift.Colleen Schnettler 15:59 Are most of your customers in the US?Michele Hansen 16:02 Yes, US and Canada, we do have a small percentage of customers who are outside North America. Usually they are companies or consultants to companies in the US or Canada, they're working with that data. So for example, it might be and you know, development teams in Southeast Asia or Eastern Europe, pretty often we do have customers in other parts of the world, but they're usually they're all working with US data. It's always been that we will get customers and work requests pretty much at any hour of the day, you know, the Middle East workday starts on Sunday. And so pretty much Saturdays are really the only quiet day. But that's actually when you have people working on hobby projects reaching out to us. And pretty much normally from you know, 7am to midnight, we're getting stuff and then overnight. But but the shift that's been more difficult is that, the US doesn't wake up until three o'clock local time here. And that's also when our daughter is getting out of school. And so one of the nice things is we get tons of focused work time, from eight to three, we can get so much done, and really not have any meetings, any requests coming in, and it's great. But then the other thing is all of the requests start around three o'clock, and pretty much don't stop through the through the night. And that's that's family time. That's dinner time. That's bedtime, and like we can't be working during those hours as well. And, um, and it's definitely been a shift to not work from 8am to 11pm and exhaust ourselves.Colleen Schnettler 17:51 So how do you handle that? Okay, quick first question is what kind of response time do you think is reasonable into your clients and customers request a view?Michele Hansen 18:03 So this is a difficult one, because I think our own standards for what's reasonable is a lot higher than our than our customers. And, you know, if someone has a critical issue, like, you know, we have alerts that will wake us up in the middle of the night for, you know, a database goes down, or a server fries or whatever, like, those things wake us up in the middle of the night. Thankfully, they don't happen very often. But I think if you look at our Intercom stats, it like our actual, you know, median response time is something like under two minutes, like, it's really, really fast. And so part of it has been being more understanding of ourselves and seeing we actually don't need to be responding to things in two minutes most of the time. And the other thing is also what can we do to reduce the amount of tickets? And I, I have this this sort of guiding belief that every ticket should only happen once. Right? Colleen SchnettlerYeah.Michele HansenLike nobody really wants to talk to customer support, because if you talk to customer support, it means there's a problem, right? Like, nobody wants to be standing in the customer service line at Target.Colleen Schnettler 19:19 right? You just want it to work.Michele Hansen 19:21 Exactly. You want to not have to end up in their first place. Now there's a small percentage of people who are you know, maybe they're they're lonely or whatnot, and they enjoy talking to customer support people. Were you know, anyone who's ever answered the phone has had frequent fliers and whatnot. Thankfully, I don't know why. But we're not really in that situation. I think maybe because of what our businesses is and being in B2B like people have a problem. They just, they just want to get it done. Like, I've only had one time when I had someone say, Hey, what's up and I was like, how can I help you? And they're like, "I'm just waiting for something to deploy. Like, how are you? I want to see if there was a real person here." And I was like, That's funny. Like, cool. What We're going to talk about something like this the only time that's ever happened. Um, and so, so every ticket, we try to take it as a signal that like something needs to be fixed. So whether that's, you know, I geocoded, this address, and it came back, and the result was a mile away from what I expected, or, you know, what is the price for this or whatever, like, we try to make sure that each issue only comes up once. And we're not perfect about that. But we take those as hints for things to improve. And so this came up this week, we're talking a couple weeks ago about how we launched a HIPAA compliant product, remember.Colleen SchnettlerYes.Michele HansenAnd how Initially, it was kind of a kind of a rocky launch, because some of our expectations for for that product. And our research didn't totally reveal all of the complications with that, primarily how long the sales cycle is. And so because the onboarding process we had built for that was basically all online, you know, assuming there wasn't a lot of stakeholders involved. And that didn't match these companies, you know, because you have to talk to procurement, you have to talk to legal, you've stuck to security, like, all these things, they can't just go through a online signup process, boom, boom, boom, and get started like they can with the standard product. So instead of having people go through the onboarding, and get themselves set up, we just had them contact us. We set it so that it would fire off a message to us a chat message saying, I'd like to get started with Geocodio+HIPAA. And the problem is, this would this would lead to a lot of conversations, but we actually like weren't getting a lot of context from people. Like, we weren't getting details on what they knew about the product and what their reasons for it were. And if they knew about the pricing model, and that we don't have a pay as you go version, all of these things, it's we're having lots of conversations, where it turns out that, you know, if we'd had better information on the website, they probably wouldn't have needed to talk to us. So one thing I finally got around to this week was changing that flow a little bit. And we would like to eventually redo the onboarding. But what we're doing for now instead is instead of having everything, go to an Intercom chat to us, I made a page on the website, that is okay, here's how you get started, and basically says, The path to getting started is as complicated as your company will make it. So when someone sends an email, I think there's less of an immediate reply expectation than there is with online chat. Colleen SchnettlerAgree. Michele HansenSo we're hoping that when people reach out to us, they're more familiar with not what the product is and what they can get, but also what they need to ask us for. So we'll see I just released it yesterday, and completely changed it. So I mean, all over the website, we had these little Intercom prompts, that instead of going to a signup flow, people would be prompted to open up Intercom. So we just changed it yesterday. But but that's something I have been wanting to deal with for a long time. And I've been kind of putting it off. So I'm like really the right way to do this would be to redo the onboarding, flow and redo all of my, you know, my journey mapping and like, do a bunch of flowcharts. Figure out what the real processes like all is basically, these things that you would do from a UX perspective, if you were in a bigger company, rather than, you know, somebody who's managing 50% of everything that's going on in a business. So sometimes you have to be a little scrappy. So I was like, You know what, having some copy on the website that at least tells people what the path forward is, let's, let's see how that goes.Colleen Schnettler 23:41 Well, that sounds like a great way to handle it. Right? Less requests more information on your site. So hopefully, that'll filter down to less requests, which is less stress for you guys.Michele Hansen 23:52 Yeah, and I mean, like, we don't mind replying to stuff at night, like, that's when we started this as a side project. So that's pretty normal to us that, you know, you're sitting in bed at 9:30 and something comes in and you just deal with it like that. That's how we've always been. But really trying to take that perspective of every ticket should only happen once. Like, if it's repeating, then there's a problem. And, and I think giving myself permission to put out a solution to that that is not the perfect solution, which would be completely redoing this whole experience, instead, just having text and see if that is a step in the right direction.Colleen Schnettler 24:35 Yeah, that makes me think of, I have that same philosophy with software, if we get an error once made, and it didn't have test coverage, write a test. So you know, you run it every time so that same error never reoccurs so that seems like a great way to handle it. But you know, the thing, the thing I want to bring up here, Michele, is I feel like in my opinion and kind of things we've talked about part of the reason of having your own business Is it gives you autonomy, it gives you flexibility, it's supposed to give you some of your time back. And you just said, "Well, we started this as a side project. So we're used to working at 9:30 at night." It's not a side project anymore. It's a real grown up business. And it might I don't know, have you thought about, like trying to tackle this in in more grown up business ways?Michele Hansen 25:21 Like hiring someone? Colleen Schnettler 25:23 Yeah, of course, that's, of course, what I'm trying to say. I just like, I just can't wrap my brain around why you won't hire someone. I know, I keep bringing it up. But...Michele Hansen 25:31 Our episode with Michelle from Squared Away, like got us thinking about how awesome it would be to have a virtual assistant. And we're like, oh, my God, if we could have somebody who is, you know, on West Coast time, right, and they can manage everything starting at 3pm. Like, that would be amazing. And you know, even if it's like, you know, a military spouse, somebody with kids, like, it only needs to be like six hours or something. And then really, but the thing is, is because whenever issues come in, we fix the underlying problems, all of these simple underlying problems have been solved. So when somebody reaches out for your support or sales related, like it's something complicated. It's something that we have to handle ourselves.Colleen Schnettler 26:20 Right. So you're you're saying that your requests coming in are all high quality? You're, you're generally thanks to, you know, your diligent work on your site, or not getting people saying, How much does this cost? Or what are my plan options. So even putting a person in front of you like to filter requests isn't going to buy you a lot, because that person is still going to be sending a lot of the requests to through to you guys, because they're high quality request, I get that. Okay. And I have one more thing that I thought of, have you thought about removing Intercom? I mean, I don't get why everyone loves it.It's so annoying that as a user. well, even as a user, it annoys me, right? Like, like, yes, like I, if I I don't know, as a user, it annoys me because now your situation is different. So if I'm having a real problem, and nine times out of 10, the bot or person on Intercom cannot solve it. and nine times out of 10. It's a bot anyway. So then when you do get a real person, it's exciting. But usually it's that first layer person, as we just discussed, so they can't help me anyway. I don't know. I just, I'm just not a huge fan. That's all.Michele Hansen 27:20 Yeah, we get a lot of surprise from people that were a real person and the founders of the company. Yeah. But I like to think that's part of our marketing, you know, our appeal that like, wow, like you get, you know, I've heard people say to us, I can't believe I get a real person who can actually do something about your problem. Michele Hansen That's true. That's true. That's very rare. Colleen SchnettlerBut maybe, I mean, we're providing that level of service for everybody. And, you know, I've looked into it, and a lot of companies charge extra for life support or charge extra for support period. But the problem is, it's been so great for our growth, yeah, that we really can't justify not doing it. And especially since how a lot of our sales model works is we starts out with somebody within a team has to get a project done, they do it for free, or very low cost, maybe they need some help getting started. And then later on, they upgrade to a later plan or just integrate us and use us for years on end. And if we deny them support, when they're only using it for a low volume, then we might lose them permanently. Colleen Schnettler 28:29 Right. I'm not talking about denying support. I'm talking about email. So it's just a suggestion, like maybe you can just downshift to email like just don't hide it be like, here's our support link, we'll get back to you in 15 hours or 24 hours. It might depressurize some of the the night especially with you guys being overseas. Like I know, you said you don't mind working late at night, but that can't be good for you know, your work life balance and mental health.Michele Hansen 28:55 No, it's definitely not. I sometimes I wish that we could just have Intercom turn off at a certain point in the day. Like it'll say on it, what office hours are, but you can't like make the chat go away. And I think the chat experience implies to people that there will be an immediate response, Colleen Schnettler Yes. Michele Hansen When in actuality, it's just emailing it to us.Colleen Schnettler Right. And we've thought about that. But I'm I'm wary to take away something that that customers like and has been a positive for our growth as a company. But then as I said, I've said before, why do we need to grow more?Colleen Schnettler 29:29 Right, so Okay, so I think and we are running out of time today, but I think in a future episode because this is also what I'm thinking about. We need to talk about the goals, right? Because like I feel like where you are in your business, that's kind of where I aspire to be. And no offense but like your lifestyle right now is not really where I aspire to be. I don't want to build a business where I have to work at 9:30 at night. So I am just I would love to have a future episode kind of about what your goals are and and your growth goals and you know where you want to go Where you guys see see yourself going and how that fits into your life.Michele Hansen 30:04 Sure, and let's do it in a couple of weeks because my honest answer is that we don't have any goals. We just want to keep doing what we're doing as long as we can. Colleen Schnettler 30:18 That's amazing. No goals, just chillin. We're good.Michele Hansen 30:20 Yeah, this is the startup podcast with no goals. Nobody's trying to get acquired. We're not gonna be on the front page of Wired. Like, we're just gonna do our thing. As long as we can.Colleen Schnettler 30:34 Awesome, awesome.Michele Hansen 30:36 Well, sounds good. Yeah. Well, we'll talk about that again in the future.Colleen Schnettler 30:40 Yeah. Well, that's gonna wrap up today's episode of the Software Social Podcast. You can reach us on Twitter at SoftwareSocPod, and we'd love to hear what you think.
Health Insurance for Bootstrappers
GUIDE: Michele wrote an in-depth companion guide for this episode. Read a more thorough rundown of the different health insurance options.Michele Hansen 0:00 Remember how a couple weeks ago, you were saying, you're really excited to get feedback and questions from our listeners.Colleen Schnettler 0:08 Yes, I do.Michele Hansen 0:10 So we got a really good question from someone recently that they asked me to address. And it is maybe one of the biggest obstacles that entrepreneurs in the US face. Can you guess what it is? Colleen SchnettlerHealthcare? Michele HansenYes. Is it healthcare, it's healthcare. Yes, healthcare as an entrepreneur in the US is absolutely insane. And I had gone through so much getting health insurance for us, and had tweeted out a really long thread of the process, because I think people who aren't entrepreneurs don't realize just how crazy and expensive and difficult it is. And so I thought today that I would share some of the things I learned as we went through that process, the different things that we we use, and some of the tricks that I found to, you know, even convince health insurance companies that we qualified for health insurance with them.Colleen Schnettler 1:16 Great.Michele Hansen 1:17 So I want to start, because this is one of the big inflection points for people is when we were first considering running the company full time, right, so we, you know, we started to co do as a side project and ran it for three and a half years as a side project. And I think we ran it as a side project for longer than probably most people would, because we were afraid of, of health insurance. And you know, something that's really important. As an entrepreneur, I find it is understanding your own psychology. And, you know, we talked about this with Alex a lot, I keep, I feel like we keep talking about that interview. And even when I was a kid, my dad was a consultant. And so we had our own health insurance. And I remember my parents would refer to the company that we got health insurance through. And I think it was called US Healthcare, as US Health Scare. Because it was just so terrible to deal with. And they were as they're always talking about things about, oh, they wouldn't cover this or that, or this was crazy expensive, or this doctor, we need one actually take it and like, I just remember, it was just always a topic of conversation. And I remember when my dad finally went in house when I was 10, or so, like one of the big reasons was, they wouldn't have to worry about health insurance anymore. I'm sure there are other reasons but my 10 year old self that was that was one I picked up on. And so I think I always had that in the back of my mind thinking about our own company and having a family and I just had this idea in my head that getting your own health insurance as a self employed person is really difficult then when you do get it the insurance you get is awful. I still have that in my mind.Colleen Schnettler 3:11 I mean, that's a huge driving force for it. You know, it is for my spouse awry. One of us will always have a like, quote, corporate job just for that reason. I mean, that's exactly what I think. Michele Hansen 3:26 Yeah, I guess because you guys have federal, or, or VA Health?Colleen Schnettler 3:28 Yeah, we had, we had health insurance under my previous full time employer, which was Blue Cross Blue Shield, and now we have it through my husband's job. But especially with kids like that, to me, would be the biggest, like scary point of us both going independent.Michele Hansen 3:45 Exactly. So that was the big scary thing for us. And so when I went full time, the plan was that I would go full time, and then my husband wouldn't, because he had insurance through his job. And that only worked for about six months. And just things were growing and growing. And we couldn't stay on top of it with just me. And so he went to his boss and said that he wanted to quit. And his boss said, No. And we're like, well, this is a good negotiating position to be in. So he ended up negotiating down that he would work three days a week and reduce his salary, but keep his full benefits. So we didn't have to lose health insurance, which was so so great. And then six months later, like we were just growing so much more getting a lot of enterprise customers and like if stuff goes down and you can't respond to it immediately, you're going to lose customers, especially the big ones. So we end up going fully full time, two years ago, September. And so what we did for the first 18 months, which so again, talking about this inflection point of "when do I go full time," which is kind of the next big one after, "How do I get something that works and makes money?". We did Cobra for 18 months. So Cobra is a basically a federal program for continuation coverage. So for example, if you lose your job, then you can continue getting health insurance, you just have to pay the full premiums that the company would be paying for you. So you know, usually when you're an employee, somewhere, you pay maybe 15, 20, 50% of the premiums instead with COBRA, you get to stay on their plan. But you pay the full premium amount. And it used to be that you could be on it for 12 months. And then with the Affordable Care Act, this was extended to 18 months. And so I think for us, this was about $1,100 dollars a month, which is a lot of money. It was less than the Marketplace plans we looked at that time. And it was also made it easy, right? Because we kept our doctors, we right, we knew what we paid and co pays and what like it was a known thing. And then we had to buy dental insurance on top of that, which I think was about 150 or so a month. And that was actually really easy to buy, you can just like go on Delta Dental's website and just buy it. You still end up with huge bills, when you go to the dentist, though that was really annoying. So. So first we did COBRA, and I was just if people have this option, it can be a really good one to just look into it. For us, you know, like family premiums were $1,100 dollars, but think about that, it is a business expense. So if you have a business that is running and is is profitable, then yes, you're going to take a hit on the health insurance. But it is a business expense. And so you get to write that off. And hopefully, since you're working full time on your business, it can grow more, you can get more customers, and you can recoup that. So the next big inflection point for us came when COBRA was running out. And this was March of this year. And I dreaded that for 18 months having to go to the Marketplace plans because they are insanely expensive and terrible at the same time. I don't know if you've ever like looked at them just for fun. I mean, why would you look at no for fun, but..Colleen Schnettler 7:43 I would not do that. No.Michele Hansen 7:51 I remember I went and and I was like, Okay, let me figure it out what it is like, like, what is a plan that is, you know, like, takes our doctors like, that was the one thing we wanted. So at least like we didn't have to switch pediatricians and stuff, right? Because like where we live, like it's really competitive to get into pediatricians and you know, they all have waiting lists and and like, let's just keep them. So I went to look at a plan that would take our doctors and the cheapest one that our doctors accepted was $3,057 a month with a $6,000 deductible.Colleen Schnettler 8:33 Oh my goodness, that's awful.Michele Hansen 8:36 Yeah. Oh, and so we could switch doctors and go with an HMO like Kaiser for example. But that still had a 1500 dollar a month premium with a $3,500 deductible. Colleen Schnettler 8:49 Wow. Wow, jeez.Michele Hansen 8:54 Which is absolutely insane. Yeah, like we would like for one of the plans we would had 50% coinsurance with like for an ER visit after a $13,000 deductible. Like, and so if you had a $100,000 hospital bill, you would still be out $63,000.Colleen Schnettler 9:17 Oh my gosh, this is insane.Michele Hansen 9:18 And so we're looking at this and we're like, so that that plan that our doctors take $45,000 a year in premiums and deductibles alone, not including dental not including prescriptions and co-pays and everything else. And so at one point I realized I was like that is an entry level employees salary. Like so as a business we could choose between paying for health insurance or hiring someone.Colleen Schnettler 9:50 Oh my gosh, that's crazy.Michele Hansen 9:52 We actually -- kind of sort of on a tangent here. You know, people will often outside the US look Give us like, Why do you have this crazy system where your health insurance is tied to where you work? And, and I will never forget being in an economics class and in grad school ones, and professors, do you know who we have to thank for the structure of the US healthcare system?Colleen Schnettler 10:20 Oh, I know. I know. I know, FDR. Is it FDR? Michele HansenNo, it's Hitler. Colleen Schnettler What? World War Two? Michele HansenYeah. Okay. Michele Hansen 10:28 Came around in World War Two. Yeah, yes. So the reason why they did this is because they needed to incentivize people to go work in the factories for the war. But normally, the way you encourage people to work from an economic perspective is you raise the wages. The problem with raising wages during a war, is that you then get inflation and inflation on the homefront is a really, really bad thing during a war because it ruins morale, and it gives your enemies, you know, inroads into the population and you know, cuz people are upset because their money isn't worth as much. And so they're like, how can we incentivize people to go into the workforce without paying them more? And knowing that a lot of the people who they would need to get into the workforce were women who would be concerned about their families, offering health insurance was the way to get people in without raising wages and causing inflation.Colleen Schnettler 11:24 Yes, so This American Life years ago, when Obama was president had a great podcast on this exact topic for anyone who is interested, wants to learn more. Anyway.Michele Hansen 11:35 So back to us realizing that we could hire someone for the cost of health insurance, we actually consider going down that path. So we're like, like, we had heard that you can't get health insurance. If you're just a founder a couple and we just kind of took that as it as a given we're like, Okay, well, what if, like, we could hire someone and then get cheaper health insurance? Because I mean, there's there's company plans, like that HMO I quoted, like, you could get that for like, seven or $800 a month for a family on an employer group plan.Colleen Schnettler 12:09 Okay, can I can I pause you here, but you are a company? Why can't you get company plan?Michele Hansen 12:14 Because it's a spousal only group. So there is there gonna be some key words I'm going to drop in here that are like things you're going to need to Google if you're looking for health insurance. That is one of them -- is a spousal only group, which is specifically like, you know, like people think of like mom and pop businesses. So oh, and so one thing I forgot to mention on COBRA, by the way, you only qualify that if you work for a company that has more than 20 people, companies under 20, people don't have to offer Cobra coverage, which really sucks if you work at a small company. Okay, so we are a company which I was like, we're a company, we should qualify for health insurance as a company. But because we were a spousal only group whenever we went to go talk to all the PEO, so these are companies like just works and Gusto has a PEO and like they'll basically administer all of your benefits and an HR for you. They would not work with us as a spousal-only group. You had to have at least one employee of who, who was not, you know, like married to the founder on the policy.Colleen Schnettler 13:27 That seems completely arbitrary.Michele Hansen 13:30 Yes. So, so we realize we're like, Okay, what if we, like hired someone like part time for like,Colleen Schnettler Yeah.Michele Hansen$15 or $20,000 a year? And we ended up getting connected with sort of an acquaintance of ours through the, you know, MicroConf, Laravel entrepreneur world. And, you know, they had had issues with health insurance. And I was like, Oh, you don't like like we can hire, you know, our acquaintance's wife, and like, she can work while the kids are in school. And like, they need health insurance, because they they had been doing, which a lot of people recommended to me, were called health shares, which we'll get back to that. And so we like looked into this, but then it ended up being like, way too complicated, because we still wouldn't have qualified because not only they, they're, they're in a different state, which meant that we would have to be incorporated and paying taxes in that state. And then we would have to have a separate plan in that state. And we have to qualify for not being just a founder, only spousal group in other states. So it actually would not have solved our problems. I think they were in Missouri or Arkansas, and we're in Virginia, and so that didn't work out. But we actually went down the path of thinking about hiring someone just because of health insurance. So then the next thing we looked into because they had talked about health shares, was like okay, maybe this is something we can do. Have you ever heard of health shares?Colleen Schnettler No. Michele HansenOr health ministries are sometimes called? Colleen Schnettler No. Michele HansenSo they are basically these organizations that it kind of functions like health insurance, except that isn't. So everybody pays into it. And then whenever you have to go to the doctor or whatnot, then they pay out of that sort of central kitty of money. But they're much, much cheaper like $500 a month. The so the catch with them that they're not insurance, usually they're run as a ministry. So there there's like, usually specifically like Christian organizations, and I got some, some people have had really good experiences with them, some people have had really bad experiences with them. For me, personally having to certify that I was Christian in order to get health insurance felt like the most screwed up version of American capitalism possible. And I like just could not wrap my head around, like, coupling those things together. And, and some people had some real horror stories with them, like not paying out, they also oftentimes they won't pay for, you know, therapy or, or other things like that, like they have some, you know, specific things that they they don't believe in, and they won't pay for. And so I decided that wasn't the route for us, but it is the route for some people. So I'm just going to mention that it's kind of worth looking into and seeing if that's going to be a fit for your family. So at this point, I was feeling pretty dejected. And then I had a had a breakthrough. Colleen SchnettlerYay. Tell me.Michele HansenSo I learned that there are a handful of states that allow small business owners to qualify for small business health insurance as a group of one. So basically, they allow something that grammarians would would absolutely balk at that it considers one person, multiple people. Or there's also a spousal-only group of one because you're legally considered one person. And so you're also a group of one if you're if your spousal-only. And so I found this chart from the Kaiser Family Foundation, which is associated with Kaiser is a nonprofit that does health research. And it goes through every single state that says whether they have what what their definition of a small group is, which is usually two, but some states define it as one. And then whether they are guaranteed issue insurance for a self employed group of one, which basically means that does the does the insurer have discretion on whether they will grant you coverage? Or do they have to grant you coverage like they would a larger company? So this table I want to say is, is slightly out of date. And but it's a good start. So like, for example, is that you know, in Connecticut, like a group is one person versus in California, it's two.This was a really good start learning this specific language, "self employed group of one spousal only group," this was this search term, that got me off on the direction of actually finding out that in my state, because those Marketplace premiums have been skyrocketing the last couple of years. Um, the state actually passed legislation that made it so that for the purposes of health insurance, spousal only groups of one could be considered for employer health insurance. And this law in Virginia had passed in 2018 and became valid in like the middle of 2019. But I remember I even I had to like email the and call the state insurance commissioner, the state representative who wrote the bill and my state representative, who I believe voted for the bill, to confirm that spousal only groups qualified for this because there had been previous legislation about groups of one that specifically exempted spousal-only groups from qualifying for it.Colleen Schnettler 19:23 Geez.Michele Hansen 19:23 Right. So I actually ended up getting like like a, like a letter from the Commissioner of Insurance in Virginia or an email saying that like yes, specifically like spousal- only groups qualify as as groups of one and can purchase employer health insurance. So then I went back online to healthcare.gov. And and it was like, oh purchase small business health insurance. They have their own rules for purchasing health insurance, and we did not qualify to purchase small business health insurance through the Marketplace and I still don't understand why. And there are all these different rules about it. But we couldn't purchase it through the Marketplace. And I was like, This doesn't make any sense. Like it says that I can purchase it. But this is also saying that I can't purchase it. And so it's crazy. So I ended up emailing a broker I had worked with years ago, because I'm years and years ago, I was the Operations Manager for a small digital agency. And I was responsible for buying the company's first health insurance plan. And I have to say, like, if I had gone into this process, without that understanding of the health insurance industry that I learned from that, like this, this would have been totally overwhelming, which is why I'm doing this podcast.Colleen Schnettler 20:42 I'm overwhelmed just hearing a story. Like this makes me never ever, ever want to have to find private health insurance. Michele Hansen 20:52 I think I need to write a blog post because this is probably --Colleen SchnettlerYeah. Michele HansenTotal, you know, this is so overwhelming word vomit on insurance. So, so anyway, so I ended up emailing this broker, and I was like, I was like, Can you just help me understand what this means? And like, can maybe, can I buy insurance from you? Like, am I allowed to buy insurance for you? And, and he was super nice. And and he was like, you know, we usually work with larger companies. But, you know, here's a here's a broker that works with small businesses and and, you know, I have some clients who work with them. And, and, and maybe they can help you. And so I talked to this local broker, which I had, I guess, I had initially been kind of afraid to do cuz I was like, Oh, we don't qualify, like, we're just gonna waste their time. Like, I don't want to even bother with that. They ended up being super, super awesome. And they said, No, we like we have had had clients who are able to get insurance as a spousal only group of one, you know, we can work with you. In order to get through underwriting with them, which is basically like the health insurance company then, you know, thoroughly goes through everything with a fine tooth comb, kind of like how when you get a mortgage, you get a pre-approval, but then you actually have to send off all your tax returns and bank statements and everything for them to, like, fully vet it. So it was like stuck in underwriting with the health insurer for like two or three weeks. And I ended up having to send that paperwork that I had from the Commissioner of Insurance, like I had, there was like a policy letter I had found online, and like something from the state representatives I had talked to, and then that email I had, specifically saying this spousal only group of one qualifies in Virginia, and then having to send it to them and in convincing the insurance company of what the law was and telling them what the law was. Colleen SchnettlerWow.Michele HansenBecause they didn't even seem to know it. And it also it just changed six months earlier. The insurance company did not seem super eager to work with us, but we were granted insurance. Colleen Schnettler Tada!Michele HansenAnd that took effect in March. And I think we actually got dental included with that. So I think it's about like $1,300 a month.Colleen Schnettler 23:12 With what's your deductible? Michele HansenNone. Colleen SchnettlerOh, okay. Michele HansenYes. Colleen SchnettlerSo it's better than your Cobra cover. Sweet.Michele Hansen 23:18 Oh, way better than Cobra coverage. Yeah. Okay. Yeah, I think we're actually we're saving like $100 a month or something because because the dental and everything else was was included so it actually ended up being pretty awesome but then of course the pandemic hit which is you know, on the one hand really great to have insurance but also you know, we stopped going to the doctor and to the dentist and everything and then and then we ended up moving to Denmark this summer and so now we have to pay for insurance through our taxes and so we never even used this amazing health insurance that I fought so hard to get but yeah, that is the saga. "Spousal only self employed group of one" are the search terms people are going to want to use when they are tackling the unruly dragon that is us health insurance. Um -- it's awful man.Colleen Schnettler 24:19 How many hours of your life do you think you wasted trying to sort this out?Michele Hansen 24:23 oh my god like hundreds of hours and then also there's the expense of it right? Like if you're thinking about you know, running your let's say your product is making your salary, right, it's matching your salary which is a time when a lot of people considering jumping into full time. If you have a family you need to add $15, 20,000 on top of that to really you know, plus you know, whatever you're paying in taxes right like to get at what is your you know, what is your f-you money number, right? Colleen SchnettlerYeah.Michele HansenIt's crazy. It's I think it's the number one thing that holds people back from becoming entrepreneurs in the US. And then it gets even more screwed up when you realize that that's actually the point. Like the point is for people to not work for themselves, the point is for people to work for companies, because again, the, the whole point was to encourage people to work for companies without raising wages, which is, quite frankly, I mean, it's a crazy thing to look at a chart of wages in the US since the 1970s, and see that the cost of having an employee has gone way up for a company, but wages have stagnated because benefits costs, especially health insurance, have skyrocketed.Colleen Schnettler 25:45 Yeah. So can I summarize, for those that are thinking about making this leap and trying it? First thing, use your COBRA as long as you can. So you can have time to sort it out. Michele HansenIf you have it, if you work for a company with more than 20 employees.Colleen Schnettlerif you have access to it. Colleen SchnettlerSecond thing, get on the internet, and see if your state qualifies for this group of one company health insurance.Michele Hansen 26:06 Self employed group of one. And if it's only you, you might have to add a spousal only self employed group of one.Colleen Schnettler 26:17 And then once you sort that out, you have to go to the marketplace and try and buy it. But they might not let you buy it there, because they don't even know the laws?Michele Hansen 26:27 I wouldn't even they don't know the laws, if you don't have an employee. It doesn't seem like you can buy through the Marketplace, even if your state allows you to buy Small Business Health Insurance without an employee.Colleen Schnettler 26:36 So you have to find an independent broker and write them. And then you're going to email them that email you got from your state, maybe telling you it's legal. That sounds great.Michele Hansen 26:46 So they're not using a broker at least is that you don't pay extra on top of that, like there's all sorts of kickbacks going to the insurers. It's kind of like when you buy a mutual fund or life insurance, like you're like you don't pay a fee to your agent, like they're just getting a percentage fee. Which is also -- this is also why you should be cautious about financial advice from somebody who works for a company. But that's a topic for another day. But basically, your broker is going to get a get a kickback from the insurer. And they will show you they should show you plans from from multiple insurers as well. Be -- don't be afraid to go find a local broker. And if you have a friend who you know works in HR, for example, for a company near you, in your state, maybe ask them who they work with. And maybe that whoever they work with can get you off on the right direction. You can also just Google it, but I feel like with such a complicated thing, people like to work with people who are recommended.Colleen Schnettler 27:44 Yeah. Wow. Well. eah. Glad you guys sorted it out, essentially, Michele Hansen It's a saga. Gaga.Colleen Schnettler 27:50 Yeah, no kidding. Michele Hansen And it's so expensive. Like I just said, If policymakers actually wanted to encourage small business creation, reforming health insurance and making it not so ungodly, complicated, and expensive with what I would say is the first step. Anyway. Did you get your 10 users yet?Colleen Schnettler 28:15 I did -- got them yesterday.Michele Hansen 28:16 So to catch everybody up. Because we had our interview last week with Michelle, which was so amazing, by the way, like I really want a VA after talking to her. So Colleen got her image management service done and ready and into the Heroku marketplace, which is the first place she's launching it. And in order to get it out of out of beta -- or into beta --Colleen Schnettler 28:42 So it's an alpha. It has to go to beta.Michele Hansen 28:45 In order to get it into beta with the Heroku marketplace where like other people can search for it and sign up for it. She needs to get 10 users of it. So, did you get your 10 users?Colleen Schnettler 28:58 Got them. Michele HansenYes!Colleen SchnettlerGot it yesterday! Victory!Michele Hansen 29:00 Sliding in under the deadline! I had written in on my calendar today ask Colleen if she got 10 users. And you're like, "this is my goal, hold me to it. And you did it." Colleen Schnettler 29:12 And that's one of the things I love about our coffee chats is, as this is a side project I'm trying to fit in between work and life. It helps to have our weekly catch ups. So I'm like, Oh, I got to do this. Because I told Michelle, I was gonna do this. So yesterday, instead of just like throwing it into the ether, like, I targeted specific people, I knew that I knew how to Heroku accounts. I was like, "hey, do you want to sign up?" People like personal invitations, and it worked. So I got my 10 users. So the documentation is almost complete. I wrote it once. I gotta go and add some documentation for other languages because I wrote it. It's very Ruby on Rails specific right now. So I need to go back and add some other language support. And then I submit the documentation for approval, and then I believe I had to talk to a real person, which should be fun. And then it's in beta. And then it's I can't charge for it yet at that point, but it's open. And it's available on the marketplace to allow users to sign up and try it out.Michele Hansen 30:15 So a couple of weeks ago, we're talking a lot about documentation. And I'm curious -- if kind of had almost a mental block around it.And I want to say, or you just really weren't looking forward to it. Like, it was very much a chore. And I'm curious if we made any progress on it.Colleen Schnettler 30:33 I find that for me, writing documentation is like writing an English paper was in high school, like, I hated starting. Now, once I started, it was okay. But man, starting was just challenging. And documentation is the same way. Two days ago, I started two days ago, so better late than never right? I sat down, and I started writing it. And once you start, it's okay. Right, you get into it. And so I wrote my first draft of it. And then I was reviewing it today and realize I hadn't -- I needed to include this for, you know, different languages. So it's almost done. So it should be done by tomorrow. So by next recording of our podcast, I will definitely be in review, I would have hoped they can turn it around faster than a week, we'll see. Michele Hansen 31:21 It sounds like. You said it's boring, like a high school paper, but you didn't treat it like one, you know. I mean, I didn't start English papers until the night before. So you, and you've actually you're editing it and you're editing it, you're going over it, you're I mean, maybe you were super conscientious in high school. Colleen Schnettler 31:42 Once I started getting into it, it was fun. Because I was able to like, take a step back and try to put myself in the shoes of someone who's never seen this before. So it was good for me to approach it in that way, to really try and spell out all the details of what's happening, how it's happening, and how you can work with it. So it was actually kind of fun. Once I started, man, there's just something about starting that's tough with that, for me, I don't feel that way about writing code. Like I love trying to implement new features or whatever. But there's something it's, you know, I don't blog. And that's probably why. You know, there's a lot of talk in the developer community, oh, you should blog. I've written like five...Michele HansenThere's a lot of talk in the developer community that "you should blog, you should have side projects, you should know why..." you don't need to do any of that. Colleen SchnettlerLet me just say you don't need to do any of that. If you don't want to do that. The blogging thing, especially like I love that other people do, and I appreciate it. But it takes a ton of time. And it's just not something I've ever been into. So...Michele Hansen 32:47 But you know you are into, is like solving your problem and not having to deal with this anymore. And I wonder if you can kind of put yourself in the shoes of Colleen six months ago who was slogging through image management manually on a site and like, imagine that you are talking to yourself six months ago, and explaining this really cool tool that you have just found. But you have to tell past you how it works.Colleen Schnettler 33:19 Yeah, totally. And so I'm trying to approach it in that way, like, and it's funny because so I have to write it in other. Like I said, I have to use other languages. And I don't know Node. I've never I mean, I know JavaScript. But I haven't written anything with a Node back end. And so a friend of mine, jumped on a call with me today to talk a little bit about the node ecosystem. And how if you have a Node application, the ways in which you might implement this. And it was great to see his perspective coming in from like, a completely different language. And it also he was like asking me how something worked. And this particular part I had written like six months ago, I didn't even really remember I was like, I don't remember if I preserve the ID or the name of the tag or both. So I had to go back in and check. So I added that to the documentation. So when I forget again, in six months, I can look at my own documentation.Michele HansenNice!Colleen Schnettler So it's good. You know, another thing that I'm thinking about, but it's a little premature to do is I told you it's everything is written in such a way that I can pull it off of Heroku. And I have more people interested in this that do not use Heroku. So my original plan had been to like go through the entire Heroku pipeline. But the problem with the Heroku pipeline is you have to get 100 people to sign up. That's crazy. Michele HansenThat's a lot. Colleen Schnettler That's a crazy lot of people. Are you kidding,Michele Hansen 34:49 Like, I mean, if I can, like if you're getting basically five people a week. Like that's gonna take you 18 more weeks. Right,Colleen Schnettler 35:01 like it's gonna take forever. So I don't, I don't, I'm not there yet. Like, I've got to get my documents approved. But as soon as I'm in beta, I'm also going to, maybe we'll see, we'll talk about it.Michele Hansen 35:11 Like 18 weeks? How, like, how many more Perpetual Marches is that, I don't even?Colleen Schnettler 35:17 it just seems like I don't know, if I'm missing something I, as I said, I think I actually get to talk to a human. So I can be like, hey, human, really. Um, so I've got I've had a couple people that are not on Heroku asked me to use it. And I'm tightly integrated into the Heroku ecosystem, because I'm a Rails developer. But I know a lot of people who are pure JS developers, and they're not. They're not using Heroku. So some of them are, but most are not. So I'm thinking maybe once I get everything rolling with Heroku, I will take the steps to release it into the wild. We can we can talk more about that. But I've been thinking about that, as more and more people have kind of been like, Oh, I want to try it. I'm like, Oh, well, right now. You can only sign up for Heroku. They're like, Nah, I don't use Heroku. Michele Hansen 36:03 Well, guess what's being off of Heroku? You can also charge for it right away. Colleen SchnettlerYeah, girl. Sure can!Michele HansenSo maybe, to kind of, you know, yeah, as you said, once you get everything sort of set on Heroku. I mean, also, you're removing your platform risk, right, like we talked a little bit about the whole, don't build your house on someone else's lawn risk, and you are diversifying that risk right away and can potentially start bringing in paying users faster. Sounds like a win winColleen Schnettler 36:33 Yeah. So yeah, that might be that might be a win win. So I'm thinking about that. Michele Hansen 36:42 Well, we'll be excited to hear where you are next week. Colleen Schnettler Awesome. Michele HansenAnd if anyone else has any other questions for us, or things that you would like to hear us talk about, definitely feel free to tweet at us. You can find us at @softwaresocpod.
Bootstrapping a Company to 130 Employees
Michele Hansen 0:00 Hey, welcome back to Software Social. I'm Michele Hansen.Colleen Schnettler 0:04 And I'm Colleen Schnettler. Michelle PenczakAnd I'm Michelle Penczak, the CEO of Squared Away.Michele Hansen 0:09 We are so excited to have Michele with us our guest, another Michelle. She. So she said she's the founder of Squared Away, which is a company that employs mostly military spouses to be virtual assistants. And they have over 130 remote virtual assistants working for them. So Colleen and I are super pumped to have us joining our virtual table today to learn more about her business and what they're working on.Michelle Penczak 0:47 Thank you guys for having me. I'm excited to chat with y'all.Colleen Schnettler 0:52 So Michelle, I have just so many questions about how you started this business and grew this business. And I would love to like kind of hear a little bit about the beginning of your story, I read some of your Medium articles about how you were a virtual assistant and you got laid off. So most people, when they get laid off, you know, they try to find another job, or they just don't find another job, but you decided to start an empire. So can you tell us a little bit about that.Michelle Penczak 1:18 I wish it started and found that cool. But um, I it kind of sounds like a really bad country song getting started. Um, I was a virtual assistant for zirtual in 2015. And this is where the sad country song part comes in. My husband had deployed two weeks before I was three months pregnant with my first little boy. And I was actually on a family vacation when it happened,Michele Hansen 1:51 Oh my gosh.Michelle Penczak 1:52 So literally woke up one morning, five years ago, and couldn't login to my email. And that's when I found out along with 399 other people that we did not have a job.Michele Hansen 2:05 Oh my gosh.Michelle Penczak 2:07 I still am like, Oh my god, I can't believe that happened. even five years later, it's kind of crazy. But, um, I called one of my clients who was to be honest, my favorite client at that point, and I kind of had a mini meltdown on the phone with him. And he was like, "You know what, it's going to be okay, because we're going to get you more clients, and I'm going to keep working with you." And he told me that and I was like, You know what, yes, I'm going to kick ass regardless of what's happening right now. And I'm going to do my thing. And I did that and started my own independent contractor business as a VA. And I worked literally, my husband will tell you, I worked up until the moment I got my epidural, with my four year -- now-four-year-old, but I was literally like, putting my out of office email up when I was going into labor. And I took a grand total of two weeks off. And because it was just me, at that point, supporting my clients, and worked with them with a newborn and that whole thing and becoming a new mom and all the craziness that goes into that. And in true military fashion, Colleen, I'm sure you are familiar with the military fun, um, my husband came home one day and was like, hey, guess what, we have orders to Hawaii. And I was like, shut the front door. Get outta here. I cannot even entertain this idea right now. And, um, I can't, you know, working with my clients. Um, I told them when we were getting ready to move to Hawaii that I was taking a week off to move. And I took a week off, we moved to Hawaii, and I started working with them like normal. I just started getting up at 3am to work Eastern standard time hours with them. And still had, you know, a nine month old at that point. And I told my husband was like, I am either insane, or I have way too much of a coffee addiction to stop this. And he was like, you know what it's working. And I did that for about six months before Squared Away was kind of implanted in my brain.Colleen SchnettlerWow.Michele Hansen 4:31 Can you talk to us about how you're, you're in this state where you are waking up at 3am every day with a newborn, navigating everything that comes with having a baby and attempting to work and then you decide to create a company and -- talk to us about that. So I like I'm so excited to hear this, I have to say cuz like we started Geocodio when our daughter was four months old. And people always think we're crazy. And I don't think I've come across anyone else who started a company with a baby. And so I'm really excited to hear from you about how that came about.Michelle Penczak 5:26 I, so my co founder, Shane, he was one of my clients, and his company was doing really well. And he had always told people about, you know, the glory of having a virtual assistant as a resource on your team. And he was like, you know, what, I need you to scale. I need you to clone yourself. And I was like, Huh, this is as good as you get like, you get me. And he told me, he was like, you know, we need more of you. How can we do that? And I said, I told him, I was like, let me think about it. And I called him a couple days later, I said, I figured it out. We're good. We can do it with military spouses. Because I had always heard, you know, in my journey, as an assistant, how can you work? How can you have a baby and work? How can you still be able to do this as a military spouse? And you know, I would tell people, hey, I work as a virtual assistant. And they would say, Well, how will How can I do that? How can I get into this, and I didn't really have a good path for them I, at that point, I just kind of fallen into it with my circumstances. And this was a really clear cut path for me to say, this is what I did. This is how I provided help provide for my family. And this is how we can make a path forward for other military spouses as well. So yeah, it all kind of happened by circumstance. But um, my when the idea came about, I'd been in Hawaii for about six months. And my son was thriving, he was going to preschool. And I was like, You know what, because I don't get enough sleep as it is, let's take this journey. Squared Away started, was officially formed in March of 2017. And I brought on my very first assistant, who is now my director of operations, in July of 2017.Michele Hansen 7:26 That's amazing. And I think I think maybe, almost with both of you, it's probably worth diving in a little bit more on just what it's like to be a military spouse and how hard it is for military spouses to work. Because I think, you know, being sort of like non military, myself and not coming from a military family, like, this isn't something that that you really come across. And like the unique challenges there.Michelle Penczak 8:00 Yeah. And I, I can speak to the pilot side of the house, I know calling you said your husband's a Navy pilot, as well. So their schedules are so unpredictable. Like sometimes they're flying in the mornings, sometimes they're flying in the afternoon, sometimes they're flying at night, and they're just kind of all over the place. And when you have to be that constant for your family and for your kids saying, Okay, well, I'll pick you up from school, I'll do bedtime routine, and all that good stuff. That's something that's very fluid with every single day. And it's not predictable, and the following week, and being able to say I have this job or career that I'm working towards during the day and being able to support your family is huge for a military spouse, because a lot of times it's so reactive to the military members schedule that, you know, you can't typically work a regular nine to five job in an office or even you know, as a teacher, sometimes it's really hard. And one, one of the "safe" jobs, I guess, for military spouses, so is extremely challenging, because, you know, there's just so much unpredictability there.Colleen Schnettler 9:13 Yeah, not to mention the moving on top of that.Michelle Penczak 9:17 Yes. All of those things. Plus, you may move every couple years. Absolutely. Colleen SchnettlerWhich is, I mean, that's why I got into software, because I could do it on my own time remotely.Michelle Penczak 9:27 Exactly. And that's something that you don't have a set schedule, because in my experience, most employers were either like, Oh, well, you have to work this schedule. If you don't, then we're gonna let you go. Or on the flip side, Oh, we don't want to hire you at all because you are a military spouse and you're only going to be with us between two and four years is that so? There's so much stigma that goes along with being a spouse, especially when you're applying for a job and I think what I've found is that people who are you know, I've seen a lot of companies that will say, Oh, we support military spouses. But then when it actually comes down to hiring a military spouse, they always find a reason not to.Colleen Schnettler 10:12 Yeah. So you decided you wanted to start growing squared away. What was your first step? Did you go for clients first? Did you look for talent first, like, how did that kind of evolve from you and your partner to this hundreds of employees?Michelle Penczak 10:27 So oh, I wish I had a really good answer for that. But it was more, we're on a teeter totter. So the more popular we became with clients, the more assistants were able to hire. And it's kind of still that way on now, we hire between four and six assistants a week, just depending on our client demand. Um, this time, last year, we had about 60 assistants. And now as Michele said, we have over 130, which is great.Michele Hansen 10:57 Wow! Over 100% growth in a year, that's amazing.Michelle Penczak 11:04 The pandemic was extremely terrifying at the beginning, but we found with everybody moving remotely, um, you know, we did have a tough couple of months where we weren't bringing on assistants, we didn't have very many clients coming on board. But then we started to get back to where we were, and continue to grow, which quite honestly shocked the heck out of me in the middle of this pandemic. But our team is amazing. They're extremely talented, they have found so many different creative ways to work with their clients and support them. And most of the time, just being a listening ear and saying, hey, let's brainstorm together, more so as like a partner than a typical assistant.Colleen Schnettler 11:50 What I'm wondering is, you started this process five years ago, with a baby, as a military spouse, and now you've you've grown this very successful company. Was there ever a time you wanted to quit?Michelle Penczak 12:04 Oh, yeah. More if I wouldn't be lying. If I said there wasn't, I'm there. This time, actually, um, I had my second little boy in May of last year, and my husband was deployed. And it was just me and my four year old, my mom came out for about six weeks to help me. But after she left in July, it was so hard with a four year old and a deployment where he was finally understanding what it looked like to have daddy gone. And I was getting used to mothering two, instead of mothering just one, and Squared Away was really starting to boom, then, and I was so tired, I was so frazzled, and it was just hard. And I wanted to quit so many times, I would call my husband and say, How can I do this, I'm literally it's literally just me, I'm in Hawaii, I don't have anybody other than my friends and, like, family from afar. And it was hard. It was extremely hard on me, it's been hard at points in time on my marriage. And it's hard to for my kids, because, you know, they is a struggle to be present sometimes when I'm trying to balance, you know, the needs of my team and the needs needs of my kids. So I would say that there's definitely been a lot of points where I've really taken a moment and said, Is this something I really want to keep doing. It's so funny that every time that happens, somebody will come to me and say, "Thank you for this opportunity. It's doing amazing things for my family." Or, "Michelle, I just want to tell you, like, this is an amazing company. It's so supportive." Like some type of comment will come through even just like a message in slack or something, just saying, thank you so much for having me on your team. And when I take a step back and look at how many people we have, and how much value they're feeling as an individual spouse, it makes it all worth it. And that's something I wouldn't trade for the world. And I hope it teaches my boys a solid work ethic and, you know, taking care of people and how important that is.Colleen Schnettler 14:30 Yeah, it must feel amazing to have a business where you're actually like a profitable business where you're actually doing good for the world to, that's like a win win.Michelle Penczak 14:36 Yeah, I I literally have to like pinch myself at least once a day and say, Oh my gosh, this is happening. This is incredible. And we have assistants who are from Poland to Japan. We have them all in between. And that's just something I never would have imagined that a few years ago.Michele Hansen 14:58 I think it's interesting how you say when you're having those tough moments, nice comments from people that you work with, come through and really motivate you. And this is something that Colleen was talking about last week how she just got her first customer for her new service, and how the the journey to that point was so long, but then you get to that point when someone appreciates it, and I find that in our, in our business to where I feel like there's so many blog posts and everything about staying motivated working on your own company. And, and I think what I see in your story, and in ours as well, is that that motivation is as much internal as it is external, from people simply appreciating you and what you do.Michelle Penczak 15:58 Yeah, it's, and it's not just from assistance, either. It's from clients, it's from people who've, you know, we've had clients who've been with us for two years, and they're just like, I can't imagine my life without my assistant, who is my right hand. And, you know, even from new clients who have had their assistants for a week saying, Oh, my gosh, like, my life is changing because of this person, like, those small comments means so much, especially when I am personally struggling with, you know, the conflict of, you know, family versus business. But the really great thing about Squared Away, I think, is that, you know, our mantra is, we're a family first, we're business second, and I have 130 people who I can say, "Guys it's a rough day, let me just tell you, what my four year old did." And we'll all kind of commiserate together and we laugh together, we cry together, we pick on each other, like, it's very much a family. And that's something that, you know, I have team members tell me all the time, like, it's so hard to log off with Slack and have boundaries, because I always want to know what's going on with people. And I think that's great, because, you know, we have that internal and external support.Colleen Schnettler 17:15 So when you started to grow Squared Away, do you have a business background? Or were you just learning on the fly?Michelle Penczak 17:22 Totally on the fly, um, I had my background is actually in political science and history. So I can teach you all you want to know about history, but I couldn't tell you what MRR was three years ago, to save my life. Um, I was totally learning on the fly, I still am learning on the fly a lot of times, but I always, um, my rule of thumb is to always be transparent with my people and tell them what's going on. If they want to know if we're having a bad month or a good month, or, you know, if we've had a crazy client situation or something like that, I'm always like, this is what it is. And this is what I'm thinking moving forward. I'm behind number one is also my mantra, transparency, number two, like, and going with my gut. So those are my top three things. And I feel like they've taken me this far and will continue to take squared away as far as we want to go. But those are, that's my background, I don't have any type of business experience whatsoever.Michele Hansen 18:31 As you've learned about business over the past couple of years, and, and clearly have sort of discovered an innate propensity of yours. for business. Are there any resources that you have found useful in that journey?Michelle Penczak 18:50 Yes. Oh, my gosh. Um, so my favorite resource is actually a book by David Marquet. It's called Turn the Ship Around. It's about building leaders. Michele HansenYes!Michelle PenczakHave you read it? Michele HansenSuch a good one. Michelle PenczakOh, my gosh, yes, it is one of my favorite books, but he is incredible. And it's teaching, it teaches you to empower your people on your team and not ask for and not have them ask for permission. So my team knows but you know, never go to Michelle and say, Can I or may I? Hey, this is what I intend to do. And I would love your feedback kinda thing. Um, but that's how Squared Away is built out completely, is based upon that. And I would say that's been my biggest and most helpful resource.Colleen Schnettler 19:36 So were there any -- when you were building this business were there any or you're still building this business, I guess? Are there any communities that really helped you that you were a part of any like groups or anything like that, that kind of helped you on this journey? Yeah,Michelle Penczak 19:50 Absolutely. So I'm a part of a few different ones. So the first one I would say is Dreamers and Doers. It's It's an amazing group of women who are just badasses in and of their own right. And they're building all types of different businesses out there. And their resources have been phenomenal. We have a lot of clients who work with them. And they're just women empowering women, which is always amazing and such a joy to be a part of. So that's a huge one. And then I'm a part of several different military spouse Facebook groups. That, you know, it's teaching women how or spouses how to find work as a spouse, and the different companies that are military spouse friendly. And I'm just sharing type different types of resources for resumes and different free resources out there.Colleen Schnettler 20:51 So when you are selecting people, like, that's got to be really hard, I imagine because I imagine everyone wants to work for you. And you want to keep your quality high. Like, can you talk a little bit about that process?Michelle Penczak 21:04 Yeah, absolutely. So there's like, I want to say, like five different steps in our application process. And it's something that we have just improved over the past few years, based upon who we've seen improved, or just work really well internally, um, with most of our assistants have a bachelor's degree or more, we have a couple of PhDs internally, which is really cool. I just have a bachelor's so I'm always in all of how smart they are. But um, we asked for that. They have to have certain details in their profile like -- one of our random questions, what's your favorite flower. If you don't provide your favorite flower, then you don't make it through the application process, because we are a details business. So if you can't get all the details, obviously. They also do an interview with Kelsey, who is our Director of Operations. And if they make it through her then they interview with me, and then we offer them the opportunity to train with us. Not everybody makes it through training. They realize that it's not exactly suited for them in their talents, or it's something that they didn't expect. But typically, we also have them do two to three training tasks to make sure that they can actually make it through to the interview.Colleen Schnettler 22:36 What kind of things do virtual assistants do?Michelle Penczak 22:39 Oh, my gosh, you name it. Um, we have done everything from basic admin scheduling to planning yacht parties in the south of France. Um, and literally, that was an actual test. Finding a small, the smallest boat in Cannes and filling it full of ice and champagne. And having a saxophonist on the dock real and true task that we had. Michele HansenWow. Michelle PenczakThat was actually something from my co founder that he will never live down. So that actually happened and the probably one of the only times I've spoken spoken French since college.Michele Hansen 23:25 So, so something we tend to talk a lot about on our podcast is that we workshop, whatever is going on in our businesses and what we're working on that week. And so I'm curious what were you working on this week?Michelle Penczak 23:41 This week is actually pretty unique. Um, we I've actually been focusing on the Military Family Caucus Summit. It's a virtual summit that's taking place tomorrow. I'm the keynote speaker is actually the Secretary of Defense. And I'm going to be talking about military spouse employment. So that's something of its focusing on this. Michele HansenWow. Michelle PenczakI'm excited to talk more about military spouse employment, it's gonna be it's amazing.Michele Hansen 24:09 It's a huge issue, right? Like, I mean, Colleen has said a couple of times that you know, one of her goals in life is for military spouses to never have to sell leggings.Michelle Penczak 24:21 Praise be. Yes. leggings and hair stuff. Like that's where I'm at with that or face. Yeah.Michele Hansen 24:30 It always hurts so much to see that because you can see that people have so much potential and and so much capability and are completely getting taken advantage of by those companies. And I think that's really what attracts me to to your company and what you are building because you are enabling people to find fulfilment in a way that is not exploitative.Michelle Penczak 24:58 Exactly. And That's something I've trust me, I've had my fair share of people paying me for leggings and hair stuff and everything in between. And to me that just, I feel like they're preying on military spouses because they are so susceptible to those, because they do want to be able to provide for their families, but there are not enough legitimate opportunities out there that people are saying, or companies are saying, Yes, we can work with you when you PCS. Yes, we can work with you, when you go on maternity leave, or paternity leave. Yes, we can work with you when you know, you're having a rough day because your husband or your wife just deployed, like, those are things that people want to know, hey, you know, my husband's coming home in a week, or two or a month, depending on when the military decides to tell me the exact date is. And, you know, companies don't always work with that. And that's something that our assistants prep us ahead of time they prep their clients. And we have a process in place so that they can take that time. One of our assistants just got her husband back after 10 months. And that's something we absolutely wanted to make sure that she had the time to do. And she was still able to step back in after she took that time with her family. And that to me is worth its weight in gold. Because I can't imagine like working with a company that didn't support that. Michele Hansen 26:36 So in that case, like, would you have another assistant fill in for them? Or?Michelle Penczak 26:42 Yep, the process with that is, the assistant essentially preps covering assistant ahead of time, the client knows it will be coming, they might not know the exact day depending on when the military is telling the spouse, but they walk through what their client needs, preferences, all that good stuff, so that it's extremely seamless whenever one assistant steps out. Um, and they still have that support without, you know, losing any downtime with their business.Colleen Schnettler 27:16 That's awesome. Have you guys raised money, like funding? Are you good? Have you thought about it? Michelle PenczakWe have thought about it, but it's not for us. Colleen SchnettlerOkay, can you? I'm always curious.Michele Hansen 27:27 Can you talk us through why it's not for you?Michelle Penczak 27:30 Number one is, I don't think unless we had a military spouse or someone affiliated with the military, that they would truly get our mission. And that's something I never want to hand over to somebody who doesn't truly get it. And I always want our people to feel like we're a family. And if we were ever to raise money, I would be extremely particular about who we brought in, to be able to continue to fulfill that mission and that support system. And quite frankly, I don't know what I would do with more money right now.Michele Hansen 28:07 It sounds like with your business, you know, if you have clients coming on board, and what not, as long as you can keep a balance between the number of clients you have and the number of assistants that you cash flow would seem seem to balance. But I guess you know, what happens if you have a client that drops? And then what do you do with their assistants.Michelle Penczak 28:31 So our assistants will go back into the pool, or assistants who are actually available to work with clients. So if we did have a client cancelled, then they would be able to pick one up pretty quickly afterwards.Michele Hansen 28:45 And so when that happens, like for example, do you email your existing client saying that someone is available and try to place them and basically, sort of increase the average revenue you're getting per client in that scenario, or what happens?Michelle Penczak 29:00 if they cancel, then we wish them well on their journey outside of Squared Away, but then the assistant will go back into our pool of available assistance. And then our client relations team essentially plays matchmaker with our new incoming clients. So we're not really losing a whole lot there. Um, and we have a 30 day cancellation policy. So we know well ahead of time, if clients or clients are going to cancel.Michele Hansen 29:30 How would you say the split is between virtual assistants in the company versus other support staff, like you mentioned, you have a director of operations and you have a client support team and I'm just curious if you can get us give us a sense for the percentage in the work staff.Michelle Penczak 29:50 So right now all of our assistants have clients except for my directors, which is myself and our director of clients relations, client connections, our finance director and our director of operations. So the five of us are the only ones without clients right now. Everybody else has clients that they work with. And they do might have a different role. So -- one of my assistants that comes to mind, she actually has two clients. And she's also a team lead, which means she made manages a team of between six and eight assistants. And she helps to facilitate any issues that arise in the client relationship. She's kind of their support our first managerial support when it comes to our tiers. So if any client issues arise, that's the first resource for our team.Michele Hansen 30:52 It sounds like you've got a pretty well oiled machine at this point.Michelle Penczak 30:56 It is they I took some time off a couple of weeks ago, and I am extremely type A where I feel like I had to kind of always know what's going on. And I was like, Oh, my gosh, you guys could rule the world. Without me, this is amazing! So they totally blew me out of the water. And they're just every single one of them is it are just incredible what they do. Colleen Schnettler 31:21 That's amazing. I'm so impressed. Like, this is so cool. So my Michele -- Michele Hansen, Michele Hansen Me? Colleen SchnettlerYes, you're my Michele. My Michele knows that. Like, as she mentioned earlier, I mean, like my personal mission, I see all of the same struggles that you see, right, I've been, we've been in the military for 15 years. And it's such a frustrating situation to see women who want to be there for their children, because to your point, husband can't pick up the kids because who knows where he is. But they also want to work and they want to feel valued, and they want to contribute to society, and they want to support their family. And so they sell leggings. And this just drives me crazy that they can't find another path to employment. So it just what you have built is so cool. I just think it's the neatest thing. Michelle PenczakThank you, thank you.Colleen SchnettlerAnd I'm so impressed how, especially without a business background, you just like built this thing. Like, with this whole structureMichelle Penczak 32:16 Totally flying by the seat of my pants. I'm like, okay, we we need to do this. But it's, I wish it were as easy as it worked. I truly do. But I just, every time I hear the numbers of military spouse, unemployment 300,000. That's insane to me. Colleen SchnettlerYeah. Michelle PenczakA year ago, actually, the unemployment rate for military spouses was 24%. And that's what it was during the Great Depression for the entire nation. 24%. And that blows my mind, especially when these are spouses that are supporting their service members who are like, pledge their allegiance to our country. And it just it breaks my heart that there are companies out there that say Thanks, but no, thanks. You're a military spouse. Colleen SchnettlerSo what do you see as the future for Squared Away? Michelle PenczakOh, my gosh, I would love to just continue to watch our team grow and grow and keep just doing more badass things for their clients. We literally have assistance in every niche that you can imagine. We have clients who are New York Times bestselling authors, we have people in the entertainment industry, we have venture capitalists, we have CEOs of startups, like, we literally are working with everybody right now. And that's really neat to see. I tell everybody, I'm like, you know, we have so many spouses with so many different backgrounds. We have yoga instructors, we have real estate agents, we have teachers, we have a couple of nurses. And you know, the yoga instructor works really well with the venture capitalists, which was really funny. Um, but these are people who are just so able to mold themselves to these businesses and support their clients, like nothing I've ever seen before. And it's just incredible to watch them, you know, bloom on their own after we've kind of put them in that spot. So I'm very, very proud of them.Michele Hansen 34:23 I just have one more question for you. Is there anything that you wish someone had told you when you were starting this business?Michelle Penczak 34:31 I wish somebody had told me to have better boundaries. In all honesty, I would say that's the biggest thing. As a mom, it breaks my heart to tell my four year old "Mommy has to go on a call right now" or "I have an email to check" or something and I wish somebody had told me in the beginning you know, enjoy the moments with your family, your business will still be here. Because you know, even then they see the good work ethic, they also see me not having good boundaries for family. And that's something I wish I'd been better about. I would say that the biggest thing.Michele Hansen 35:13 I can say that like I have been there. And, you know, that's something my husband, I talk about that, you know, sometimes our daughter who's seven, now she'll say, Can you guys stop talking about Geocodio because it's so boring, and I don't want to hear about it. And I'm sure your kids recognize the work ethic that you're teaching them. And, I mean, you're giving a speech tomorrow and sharing a platform with the Secretary of Defense, which is amazing. And they will probably find out about that later. And they will be amazed by you. And I think they will understand. And, and I will say, you know, as someone who, whose parents were also, you know, like running companies as I was a kid, it was so good for me to be exposed to that as a child and seeing that it's possible, and seeing all those different day-to-day things that come up when you're working for yourself or trying to get something going. It's so valuable for kids to see that. And it's so clear how much you love your kids.Michelle Penczak 36:25 Oh, yes, it's, I would say, that's the biggest thing, I just, I want them to always know, you know, I bust my ass every single day for them. And for our families that we're out there, you know, providing employment for and that's something that will always be here dear to my heart. I just said hope that that's something they recognize the older they get. Michele Hansen 36:47 Maybe one more question here, so maybe someone listening is thinking, hey, having a military spouse as a virtual assistant actually sounds pretty awesome. And I need to scale myself a little bit better. So if somebody wanted to start using Squared Away, like, like, how does that process look like from a client's perspective?Michelle Penczak 37:08 they can always email me or me at Michelle@gosquaredaway.com or they can submit our contact form on our website. And they can definitely get started with our client relations team and walk through the process of finding their perfect VA match.Michele Hansen 37:26 That's awesome. Well, thank you so so much for joining us today. It's it's been really great talking to you. And I'm so excited to see where you and the company go from here.Michelle Penczak 37:39 Well, thank you guys so much for having me. It was such a pleasure and I am always thrilled to talk to another military spouse. So thank you, Colleen and Michelle both for having me.Colleen Schnettler 37:49 We'd love to hear what you think of the episode. You can tweet at us at @softwaresocpod and we will chat with you next week.
Documentation as SEO, SEO as Documentation
Michele Hansen 0:00 Welcome back to Software Social. I'm Michele Hansen.Colleen Schnettler 0:03 And I'm Colleen Schnettler.Michele Hansen 0:06 Hey, Colleen!Colleen Schnettler 0:07 Hey, Michele, how are you doing?Michele Hansen 0:10 I'm good. I'm good. I had a pretty productive day today. Little ADD in the morning, but it was good.Colleen Schnettler 0:16 What does that mean? Michele Hansen 0:19 Well, so I was diagnosed with ADD as a kid when I was 10. And so it's always been something that I have to work with, you know, working against it is not going to happen. And you know, recognizing the procrastination of it is really just me being a perfectionist in a lot of ways. Um, you know, it can also make for a fun morning, though, I made some good memes, I think. Colleen SchnettlerNice. Michele HansenNo, actually, I actually, I got a lot of stuff done. You know, a couple weeks ago, when you asked me what I was working on, I mentioned landing pages. And then, and then I was kind of like, Ah, that actually wasn't what I was planning to talk about. And, and I feel like you were kind of disappointed. But I actually did a ton of work on landing pages this week. So we can talk about that if you want. Colleen Schnettler 1:11 Oh, yay! Yes, I do.Michele Hansen 1:13 Yeah, so this is a huge thing for us. Because we don't do any paid marketing. We don't do any outbound sales. We just do SEO. And a couple weeks ago, we were talking to Alex Hillman. And something that really stuck out to me from his book, Tiny MBA was, you know, when done well, marketing and teaching are almost indistinguishable. And I think that's so true. Because a lot of what we do when I'm writing a like landing page, is just explaining how our service works, and how to do something, or, or how to do something in general, that happens to relate to our product.Colleen Schnettler 1:59 Okay, so can we take several steps back here and talk about landing pages? Michele HansenSure!Colleen SchnettlerBecause people talk about landing pages, like they're these things, they just throw up real quick. And so I kind of want to talk about strategy. And like, practically speaking, do you have? Do you always use the same template? Do you try to, you know, like, when you're marketing towards a specific group, like how do you tailor your landing page for that group?Michele Hansen 2:25 There's a lot of different types of landing pages. So what I'm doing is generally very product focused. There's a whole huge segment of landing pages that is sales landing pages and writing conversion copy, which is --Colleen Schnettler 2:46 Conversion means I convert, I buy something from you? Michele HansenExactly. Colleen SchnettlerYes.Michele Hansen 2:50 The idea is, you know, basically, you run some ads for people who are looking at a specific search term, or you or you have, you know, SEO targeted to that search term. And then you bring them into a sales page. And there's tons and tons and tons and tons of copy. And there's a story and like all of these sorts of things. And there's there's like these calls to action that are building up to it, right, like, and then they want you to convert and buy immediately from that page. That that is a whole school on its own. And not really something that we do, because we don't really need to do a lot of convincing for people since we have a free tier and people can just try it and figure it out if they need it or not, before they even buy it. So when I'm talking about landing pages, it's generally very product focused copy that is sort of either describing features of the product, or is like a step by step how to do something with the product, or is somehow just better describing what we do. Very often that comes out of conversations that we have with customers in Intercom where, you know, if we get the same question more than two or three times, we usually take that as a sign that either we need some more copy on that or, you know, maybe we need to fix something in the product to make something more discoverable (that is, easier for people to find it). Or add affordances, which is the ability for them to do something. That's generally where we focus when it when I talk about landing pages.Colleen Schnettler 4:34 Okay, so do you have specific rules like in your head, like from a design like should it only should it fit on a visible window? Should they not have to scroll? Do you even think about these things? Are they not important at all?Michele Hansen 4:47 Yeah, I don't really think about that, actually.Colleen Schnettler 4:50 Okay, I don't know. Like, that's why I'm wondering like, I've never I'm telling you for me. Like I feel like I could write a whole back end system API to do whatever but you asked me to make like marketing page and oh, my gosh!Michele Hansen 5:02 It's scary, right? Like I blank page is very intimidating.Colleen Schnettler 5:07 And it's like, the whole thing, where do I put the images? What do I say? Michele Hansen 5:15 Like, yeah, how far it's a lot, I have so many hang ups around this because I'm so afraid of coming off as spammy or, like too heavy handed of a sale that when I'm trying to write copy, it sounds so boring. Like, it's just so so dry. And what really helped me was thinking about marketing as education. Colleen SchnettlerYeah. Michele HansenAnd thinking about it, okay, maybe this is just, this can just be a step by step how to do something, you know, for example, how to add metropolitan statistical areas to a list of addresses, which is something that, for example, somebody who works in sales might do because they need to know which of their customers live in and around Boston, and in and around Chicago, because they're planning a trip during normal times when you go on trips... For example, and so it's just like a step by step list and and then there's, you know, the SEO tactics, bringing into that, like, you know, all of the, the list items need to be headers and saying, first, organize your spreadsheet of addresses that you want to add the Metropolitan Statistical Areas to, like, the next step, upload the list of addresses that you want the Metropolitan Statistical Areas for to Geocodio, it's like using the same words over and over and over again, so that, you know, Google or search engine will pick up on that using those terms in the URL is a really basic one. That is easy to overlook. I actually I realized this morning, that we had someone reach out to us asking about features of our unlimited plan. And I realized, like, Oh, my gosh, I typed like the same reply multiple times a week. And we don't actually have a page on our site that is just devoted to this plan that I can send someone and the same way. We also don't have any page, specifically devoted to free geocoding or our pay as you go tier. And so now, almost seven years into doing this, we finally have a URL that is geocod.io/free-geocoding, which is the number one search term that brings people to us and it like never occurred to me until this morning, that we should have a page with the you know, h1 and URL of free geocoding. Like sometimes it's just so, so obvious.Colleen Schnettler 7:57 So you mentioned a little bit in there about, like your varsity level, right landing page builders, so you're -- Michele HansenOh, no, okay. Colleen SchnettlerJunior Varsity.Michele Hansen 8:09 I mean, you know, we we occasionally walk by the bench they sit on...no, marketing is my weaknesses. Do you have, like you met you threw out a couple SEO things that I know a little bit about? Because I was reading about SEO for funMichele HansenAs you do Colleen? Colleen SchnettlerLike, right, I'm so weird, right?Michele Hansen 8:31 Do you have non-business related hobbies?Colleen Schnettler 8:36 They're called children. Those are my non business related topics. So there's, so do you have a list? Because, you know, I was doing all this, like marketing research, I was reading about SEO. And it seemed like all over the internet, there were like little snippets of here's a couple things to do. But I didn't find like a good comprehensive list. Do you just have your own personal list that you have found worked for you guys? Or do you just keep all this stuff in your brain and try to remember it?Michele Hansen 9:04 It's a combination of things I absorb from other people. And things I you know, I might see online in various places, but actually, I was asking a friend about this a couple of weeks ago, who is an SEO expert themselves and like, it's their full time job. And I was like, is there you know, a book or an ebook or, like, something you can send me that is like a, you know, a sort of soup to nuts kind of guide for SEO, not only from the high level but also specific tactically. And they're like no.Colleen SchnettlerInteresting. Michele HansenYeah, it's very all over the place. And and I think, you know, something is difficult being a bootstrapper is that a lot of content is written for much bigger companies, or companies that are much more flesh than we are, which is difficult because they have very, they might have very different goals, like their goal might be to get, you know, people to sign up with their email address or to submit a particular form because their goals are feeding into somebody else's goals, because there's another department that's actually going to try to convert them into a paying user and all those sorts of things. So, and I run into this with UX stuff, too. A lot of that content is geared towards people who are, you know, on a team within a larger organization, and part of that for them is like managing the politics and the incentives of other people. So no, I haven't really found one good guide, like I wish there was an ebook or something I could send people to that that was a good all in one resource, both tactical and strategic level. Mostly, it's just, it's just things I've learned, you know, I will go in and poke into ahrefs. Every so often, probably not often enough, given how much we pay for it.Colleen Schnettler 11:14 Michelle, can you tell those of us new to marketing, what Ahrefs is?Michele Hansen 11:19 So Ahrefs is this tool that you can use to basically diagnose how good the SEO is on your site and on a particular page. And so it will tell you, the keywords that are leading people to a page and your referrers, which are other websites that are linking to you, which is a very important part of SEO and building reputation, like the age of a URL is really important. And so like, if you can get a really old website to link to you, that's really helpful for your SEO, because then the search engines basically think you're reputable. Um, it also talks about like general keywords, leading people to your site, and then how easy it is to rank for particular ones. I think you can also see what your competitors are ranking for as well. And so maybe finding opportunities there. Quite frankly, there's so much going on in Ahrefs that I feel like I have only scratched the surface. And most of their instructional content is in videos, I really hate watching videos, I would much rather prefer like text because I can read really fast. So I always like oh, I'm gonna spend time watching Ahrefs today. And then I just, I just want to be busy, I want to do stuff, I don't want to watch a video. So I just pay a lot of money for something that I don't fully utilize. So that's, that's your business advice for today, don't do that.Colleen Schnettler 12:55 So it sounds like so in your head based on people you know, and your own experience, you kind of have some SEO tactics and ideas that you weave into your landing page. So when you're going to make, when you're going to make a new landing page, how do you even start you start with like, I know, you guys target specific sectors, like real estate agents, I assume and Census Bureau people? Do you start with your target audience in mind, and then like, word data mine or whatever you you know, look for the popular search terms and then build a page around that?Michele Hansen 13:30 Sometimes. Colleen SchnettlerOkay. Michele HansenSo, for example, that page I was talking about with people adding specific types of Census data that just came about because I had a customer asked me how to do that. And I was like, Oh, we should just have a guide that tells people how to do this. So that the next time somebody asks this question, I can just send them a link rather than spending 15 or 20 minutes going back and forth them on Intercom. Um, sometimes I will be targeting a specific vertical--Colleen Schnettler 14:01 By vertical you mean? industry? industry?Michele Hansen 14:05 Yeah. So for example, you mentioned real estate websites are customers of ours. But I usually don't work on those specific pages very often, more so it's how to do a specific thing. And, you know, it might be that people in sales need the Metropolitan Statistical Areas, for example, but people in all sorts of other occupations need those too. And so we don't generally target that kind of educational content to a specific type of person because the number of people who work with, you know, Census FIPS codes, for example, in their work is so incredibly vast that I would inevitably lead be leaving people out if I tried to only talk to one specific use case and also, I don't know, all of the different tools they use. Like every industry you know, every function has their own specific set of tools. And so we actually try to be as general as possible. And, and not talk too much about industry specific tools. Because you know, spreadsheet is a general word. And if they're downloading something from their CRM or whatnot, it's it's going to be a spreadsheet.Colleen Schnettler 15:17 So the way you're describing this is -- I think maybe my definition, my head is different than the way you're describing it, as I'm thinking of what you're describing more as content marketing. But they're really this for some reason, in my head, a landing page is like that, that, like, has a big "Buy Me Now!" on it, and you know, is like, Michele HansenYeah.Colleen SchnettlerI think of it as is like that, but you're basically using that definition to encompass anything that they land on.Michele Hansen 15:44 Yeah, I guess so. I, you know, I, you know, again, I'm, you know, so I also I like I think of content marketing, like I feel like we don't really do content marketing. Actually, before the pandemic, I was super jazzed about starting a whole content marketing initiative, kind of like, do you know, the site Priceonomics? So they are this, I think they're a Y Combinator company. They're like a data studio. And they will write all these really interesting, quirky articles on things that they find in their customers data when they're analyzing it. And my idea was kind of to do something similar with all of the address data that we find. So like, for example, in South Carolina, there are towns named Denmark, Sweden, Finland, and Norway, all right next to each other. So like, just kind of like writing articles about things like that, like I even came up with some cutesy names for it. Like, I really wanted to name it CurioCities, like, cities. Ah, but somebody had already taken that night, then I came up with some other name and forgot it. So that was very productive. Um, yeah, I wanted to do stuff like that. And then, you know, the pandemic hit and, and just everything fell apart, in terms of voluntary initiatives nevermind, you know, barely staying on top of the stuff that you have to get done. Colleen SchnettlerYeah. Michele Hansen I would love to do something like that and do more, like creative writing, I think that's also something I struggle with, with doing. SEO writing is it's just not. It's not very fun. You know, it brings people to us. And so it's necessary, but I enjoy creative writing. And so I would like to do that. But it's also, it's harder to justify from a business perspective, like it's fun, but like, is that really going to bring in customers, but then again, we're bootstrapped. We don't have to focus just on the bottom line. And if I want to do something fun, that's basically a side project within our main product, then, you know, I'm my own boss, I can do that.Colleen Schnettler 17:58 Awesome. Michele HansenAnyway, what's going on with you? Colleen SchnettlerWell, for those who are just joining us, I am in the process of launching my first product. So last week, I had a couple customer potential customer interviews, yeah, which was really fun. I've really enjoyed it. One of the people I spoke with is actually using it now. So I know, that's pretty exciting. And it's interesting, because the way I've written it, it doesn't work with React, which is a modern front end framework. And one of the guys like, just kind of hacked the JavaScript to make it work with his stuff. And he's like, cool, I'm gonna try it out. So that was really exciting. And so now there's two people using it, me and this other guy. And it's funny, because as soon as, you know, he was like, "Oh, I'm gonna use this!" I was like, great. And then of course, I thought of all these things, I was like, Oh, I gotta do this, I got to do this, I got to do this. And--Michele Hansen 19:00 Were those new features or like, things that you...?Colleen Schnettler 19:02 know, so it's stuff on my end. Michele HansenOkay. Colleen SchnettlerSo I had, I have focused so much on getting it working, which is great. It works great. As far as I can tell, no problems yet. But as you know, as you know, I kind of didn't pay too much attention about tracking everything, not tracking everything. That's not the right word, too much attention about how I'm going to charge the customer eventually, and things like that. And so, for example, I keep track of all of the storage each customer uses, but I don't get I don't email myself every day, like how I don't have any automatic stop gaps if they go over their limit, you know, I don't have anything like that. And it's, you know, so just kind of like things like that. I was like, Oh, I should probably I should probably figure that out before I actually get too many people using this. So yeah, so just like back and stuff like that, like should I email myself every day so I can keep track of what everyone's doing? Should I just check my dashboard? Should I put an automatic stop gap if you know, someone uses too much storage, things like that. So nothing like super crazy important right now. But as I do ramp up, I need to kind of have that sorted out. Because you know, it's storage. Like it's not, it's not free.Michele Hansen 20:24 So, yeah, I think it's basically like, you know, buying yourself insurance to protect from that downside risk of somebody running away with it. And that doesn't really matter if nobody is using it. So it makes sense for you to not build that before the launch.Colleen Schnettler 20:43 Yeah, cool. I agree. That's why I didn't. And again, it's just, it's, it's not, it's certainly manageable now where I can, you know, just look, every day, I have about five people who have like, signed up, remember, I told you, since I'm first releasing it in the Heroku, add on marketplace, I need 10 people to sign up. But I have not, I can easily get the other five. So I am not worried about that. I'm not worried about getting that number to that number 10. But all I need to do to get it to beta. And beta is when like, I can accept everyone and I'm show up in the what they call the Elements Marketplace, which is the Heroku Marketplace. So I have to get all my documentation done to so I did a couple customer interviews, I got a couple people signed up. And now I want to like fix a few things. Nothing that impacts a customer, but like stuff on my side, like I said, like I you know, like basic stuff, like how am I going to track this. And then it's just the documentation. And they have really extensive requirements for documentation.Oh! I remember what I want to tell you! This was really cool. So remember, when I told you I was like, you know, my documentation is really terrible. Like this is this is not going to work. But it was, it was really nice, because the couple people I spoke with on the phone, our developers, and they figured it out in like two seconds. Like, I don't have to explain anything, it was so great. Just because I'm so used to as a as like a consultant, I have technical customers, but I also have a lot of non-technical customers so I'm used to like having to explain things in intricate detail to, you know, help my non-technical customers kind of understand. So it was kind of cool, because I was like really prepared to go into intricate detail. And the people I spoke with, like they had it sorted out in like a second, they were like, "Hey, I just add this thing and this thing, and I'm good." And I thought, you know, it's like, oh, this is gonna be hard to explain, because there's like five steps, it was fine. So that was good.Michele Hansen 22:43 And you're like talking about SEO, our documentation is consistently one of our top ranked pages. Because when people are searching for how to do something, that is the page that is describes how to do something, and absolutely, the way to do that thing, once you find the product should be as intuitive as possible. And that's such a great sign that like it was so intuitive for them to figure it out. But the documentation is, is almost more marketing than it is user onboarding.Colleen Schnettler 23:16 That's interesting. I never thought about that. But that makes total sense. I think that's one of the good things about starting because like my app is set up, that I can just like change a few things. And it can be out in the wild. Like I don't have to go through the Heroku add on our marketplace. But I like it because for like a first step, because it's really constraining me in these ways. And I know, if I wasn't doing it, I'd be like, "Oh, it's good enough. And I just feel like it's free into the world." And I think it's going to take a while to write all the documentation they require. So I think the discipline of that is gonna to your point, like down the road, I'll have it right then I'll always have it once I write it.Michele Hansen 23:55 That's a great thing that like you, you can start out on the Heroku Marketplace, but you're not necessarily tethered to it.Colleen Schnettler 24:04 Yeah. Oh, not at all like I which is which is exciting, which is good for long term.Michele Hansen 24:10 I mean, too often, you know, see products that are really dependent on a particular platform. And it'd be so great to use a platform or a marketplace to get a product off the ground. But whenever I come across the those products or have people ask me for advice on those products, I always come back to the saying of "Don't build your house on someone else's lawn." Like if you can't decouple your product from that marketplace or that platform, or they would make you know, any any change and you would be cut off or significantly impacted. That's a really dangerous place to be and so it's, it's so good that you're starting out on the platform, but you can see future off of that platform and you were not going to be dependent on the Heroku Marketplace, even though it will be a good place for you to launch and get customers and whatnot, you can survive without it.Colleen Schnettler 25:12 Yeah, yeah. Yeah. So I just feel like I've just been like heads down working, working working, right. I have a lot going on, which is exciting and fun. And there's a lot, you know, more I got to do. But I don't know, two weeks, maybe, maybe that's my goal to be in review by the Heroku team to be in beta, which would be really exciting. So that's, that is my goal. I'm speaking it aloud. It's funny, because I always feel like we have our podcast recording, and I'm like, Oh, my gosh, I have a whole week, I'm gonna get all these things done. And then the following week, it's like two days before we're going to record and I'm like, oh, shoot, where did my time go? Like, did I get enough done? So I don't know. Time flies, I guess is my point. But, uh, yeah, so I think two weeks is kind of a realistic goal for like, applying for beta. Yeah, so it's exciting. Like, I'm pumped.Michele Hansen 26:08 I'm excited for you.Colleen SchnettlerThanks. Michele HansenYou've been working towards this for for so long, just not just this particular product, but working towards having a launch and having a user of something that you made. And I just sort of have to ask you like, how does that feel to finally have something that somebody else that someone else is using?Colleen Schnettler 26:31 It feels amazing. Like, honestly, I know, I know, the advice from from everyone and yourself included is to talk to a bunch of people before you build something. And I know why people give that advice. Like, that is great advice, you should absolutely find a market before you build something. But I think it's easy for aspiring entrepreneurs to get stuck in this cycle of never making kind of any progress. And sometimes this is more of like a small win. So like, it's funny, because when I tell my friends, this is my like, product, my non-technical friends, they are like, so underwhelmed. They're like, so you can put images on the internet, like, doesn't everyone already do that? You know, they expect me to be making something big and amazing. And I'm like, I get it, I get it's not sexy, but it's, for me, it's a stepping stone, like it's a small thing I was able to build in my extra, I don't want to say spare time, but you know, kind of in my extra time, put it in a marketplace. So it takes care of a lot of the overhead details and someone's using it and hopefully more people will be using it. And that is such a huge win. Like it just feels feel so good.Michele Hansen 27:44 I feel like can hear the relief of I don't it's like relief or just like excitement. Like it's like relief that you're finally feeling that feeling.Colleen Schnettler 27:55 Yeah. I mean, and everyone is like, you know, you've read people are sending me this videos about the SaaS slow on ramp of death or whatever that video is everyone loves. And that's, that's interesting, like, and I get it, but like not my problem right now. And these are like all good things to learn when you actually have people using your stuff. Right? So I mean, ask me again, in five years, maybe I'll be like, oh, that image thing was a waste of my time. But I don't think so. Because I think for some of us, it's just important to get going and you got to get out of your own head. You got to put something out there. And if it's a flop, it's a flop and you learn from it. And so like it does, it kind of does feel like relief. Right? Like, okay, this is a little thing I can do. You know, it's out there, almost out there. Like, that's really cool. That's so cool. I'm excited. I still have a lot of work to do, like I said, to get it out of this, like invite only phase. But it feels manageable. Right? Like, like when you're thinking of a new idea, and it feels like this big, huge thing. And it's just you and you have all these other responsibilities, like you know, work, kids family, I think you can start and then you stop because you get overwhelmed because it's just not like a manageable thing. Right? It's too much. So like, this widget is like a manageable thing. And, you know, it's I don't know, it just feels great to have something out there.Michele Hansen 29:21 You know, in the same way that like Alex Hillman and Amy Hoy talk about Stacking the Bricks in terms of a product and businesses right and slowly leveling up, I think the same applies emotionally and to one's own energy right? And like you're taking the energy and enthusiasm and motivation that you are getting from this very small product, this one brick, and using it to either improve that one product or maybe send you off in another direction that adds to that but taking that little tiny bit of motivation and allowing that to propel you and knowing that, you know, maybe this isn't going to be a huge company, you none of us are, you know, even trying to build a huge company in the first place, right, but that little bit of motivation and that feeling of accomplishment, and just building those on top of one another is so, so powerful.Colleen Schnettler 30:23 Yeah, I totally agree. Like, that's what it feels like. It feels like a little brick. But it's a big brick for me. And I need that to keep me motivated.Michele Hansen 30:33 It's your first brick! Well, actually, no, it's not your first brick because you're consulting. So that's you have some,Colleen Schnettler 30:37 I guess consulting was the first brick right. Michele Hansen 30:39 I don't know if they're bricks. Maybe those are two by fours. I'm not quite --- I'm, I'm getting lost in this metaphor here. But I'm excited, I'm excited for you two weeks from now, looking at my calendar, looking at my calendar, writing it down. Ask Colleen about the stuff she said two weeks ago. Till halfway through your goal. Colleen SchnettlerAnd halfway through my goal.Colleen Schnettler 31:07 We'd love to hear what you think of the episode. You can tweet at us at softwaresocpod and we will chat with you next week.
Something Boring, Something True, Something Alluring, Something New
Michele Hansen 0:00 Welcome back to Software Social. I'm Michele Hansen.Colleen Schnettler 0:03 And I'm Colleen Schnettler. Michele HansenHey, Colleen. Colleen SchnettlerHey, Michele!Michele HansenHow's it going? Colleen SchnettlerI'm doing well. I'm excited to hear what you have to share with us this week since we didn't get to share last week since we did my little video intro. So what has been going on with you and your business?Michele Hansen 0:22 Honestly, not a whole lot.<laughter>Colleen Schnettler Okay, fair enough!Michele Hansen 0:28 You know, I was thinking about this. And, and I think that's kind of one of the things when you get to the stage that you have weeks when you're just kind of doing, like, normal work, you know, dealing with invoices, and cleaning up stuff from the past and responding when customers, you know, report an issue or bug with something and answering questions. And, and, and not a whole lot happens. And that's kind of what's going on.Colleen Schnettler 1:03 I still think that's good for people to hear. Because I think when you, like me, as we've discussed, read a lot of like, these really exciting startup stories, it makes it sound like it's so exciting all the time. And ultimately, it's still a job, like you're still doing kind of mundane, but important work.Michele Hansen 1:19 Yeah, I mean, it's the big project, if you can call it that, that I was working on this week was a lot of things dealing with invoicing. And, you know, we've been migrating customers over from QuickBooks to Stripe, which is just as thrilling as it sounds, let me tell you, but it's also super necessary. And it's the kind of thing that you write really have to do when you've got a business that's going and it's working. And so for, for a long time, we had it set up so that if customers paid us with a credit card, they paid via Stripe, but if they paid us any other way, you know, a ACH, paper check, carrier pigeon, like that was all through QuickBooks. And I don't know why we did that. I think it's because we weren't using invoices for Stripe for a long time. And but that's created all sorts of accounting issues where when we actually want to make our financial statements in QuickBooks, which, you know, things like insurance companies and whatnot want... It always made such a mess in QuickBooks, because there was like, some payments would be counted twice. And then like we didn't really have one true source of revenue numbers. And I was always like manually patching it together with spreadsheets. And so that just you know, involved a lot of thing of, you know, setting up new subscriptions and checking once and twice and three times that everything is set up. And, you know, like, it's interesting, you do a lot of things early on that don't scale. And you do that intentionally because you don't know if you're going to be successful. And then when things do start working out, you you kind of have to, you know, basically bat your own cleanup. Colleen SchnettlerMm hmm. Michele HansenAnd I did a lot of that actually, in my in my first job. And I think that was such a valuable thing, because I think it's something every business goes through, especially as they grow.Colleen Schnettler 3:14 Yeah, I absolutely know what you mean, because I'm right in that very beginning stages where I don't know if this is going to work. And so I have absolutely made decisions that might be hard to change later if I have, if it is successful. And I can see that now. But I can see it now. But it doesn't seem like it's worth the time to put this really impressive architecture in place for you know, my three customers. So I can but I could definitely see you know where to work out down the line, I'd be like, "Alright, we got to really beef up, you know, change some of the things we made."Michele Hansen 3:48 Exactly, I think we're, we're looking at doing something like that pretty soon with how we handle failed payments. So I mentioned you we have most of our customers are paying us via credit card. And when those payments fail, like usually the process right now is we just go through manually and follow up with them. Like they get emails from Stripe, they get emails from Intercom. Sometimes I have to, you know, oftentimes email them personally, like from my own email, but I've had to go as far as like calling the front office and asking for the accounting department, DMing them on Twitter, like finding any random contact information, finding people on LinkedIn. Colleen SchnettleWow.Michele HansenAnd yeah, and it's always so satisfying when you finally get it paid. And you're like, wow, but I spent what, like six hours chasing that down for $150 like, was that really the best of my time? And so we've been kind of thinking through like, how we might, how we might like automate some of that and any, you know, introduce kinds of things like you know, Your Account isn't paid. Like, you can't do anything until you've paid up or, like, actually, as of right now, even if you have an outstanding balance, people have to contact us in order to pay, like, there isn't a way to do it in the dashboard. Like all of those small things, I think if you're using a product, you don't realize that like, every single one of those is a feature, there's no like real, you know, there's no just sort of out of the box that comes with every single feature that you might need, like deleting an account and changing your email address and updating your credit card and paying a past invoice. Like, every single one of those is a feature and you're prioritizing that against something that's going to get new customers or have existing customers, you know, pay you more add more features for them, right. Like there's like boring business improvements, versus things like new features, and, you know, marketing related initiatives that are shinier objects.Colleen Schnettler 6:01 Yeah, that's actually kind of interesting that you guys are this far along, and you're still handling all of that manually. I also think there's a way and we've talked about this quite a lot, like what do you need to ship. And there's always this, this temptation, I think, is a good word, to put everything in place before you put anything out there. So it's encouraging to me, I guess, is the right word to hear that, like you guys are still handling some of that manually, like those are things that you have been able to handle manually for quite a while.Michele Hansen 6:32 We didn't even have billing code when we launched! Colleen Schnettler That's amazing, by the way.Michele HansenLike we had integrated amazing Stripe, like we literally didn't expect anyone to pay us. And then you know, and we had that sort of like monthly payment cycle. And the first of the month came a couple of weeks later, and we're like, oh, we have to charge people today. Oh, we forgot to write the ability to charge people.Colleen Schnettler 6:59 It's amazing.Michele Hansen 7:01 Yeah, I mean, all of those things are just, you know, gradual, like, like, for a long time, actually, I think in Stripe, we were the way we were creating the payments was literally as individual payments, they weren't as invoices. And so if a payment failed, we had to manually go through and recreate the payment and retry it. Colleen SchnettlerOh wowMichele HansenAnd it was like that for like, three or four years. Colleen SchnettlerWow. Michele HansenSo every month, I would go through and recreate all of the payments when they failed. And then if those still failed, then like a week later, I would do it again. And now at least since using invoices like Stripe will retry them. So it's it's amazing when you use the features of the products that are there already there. Right. Like it like I think, you know, you kind of talked about this with like AWS sometimes it's like, there's so much there that it's, you can't possibly do all of it at once. Colleen SchnettlerYeah.Michele HansenYeah, it's an ongoing improvement. But I think, especially once you get to a bigger scale, those kinds of things really add up, monetarily and also in terms of time, right, like, whereas, you know what, when we first launched, if we had five failed payments, and it took me an hour to total to follow up with all of those, then that's not a lot of time. But if you you know, if you've got, you know, 15 or 20, whatever, like each one of those, if you're spending half an hour on it each, right, like that adds up very, very quickly. And thankfully, we usually have diligent customers who are businesses who are fine with paying us right, this is much, much more challenging when you're doing B2C. No operational improvements are automatic and and they have to be weighed against the the shiny objects that that often win out until boring stuff gets to a point where you're like, Oh, this is this is gonna break or this is broken. Oh, man, we have we Okay, fine, fine, we'll fine. We'll do this now. Fine. Like, that's usually how that conversation goes like, you're right. All right.Colleen Schnettler 9:09 Well, it sounds like you were productive this week.Michele Hansen 9:11 Yeah, I did a lot of boring stuff. And you know, what the boring stuff is good. The boring stuff, you know, makes the accountants happy, makes makes the insurer happy. Makes me happy because I don't end up going in six months later and be like, Oh my gosh, like, that was never paid. Or you know, we've been allocating resources to someone and they actually canceled three months ago, like, those are the kinds of things that you know, everybody gets sloppy on them, but you can you really can only be sloppy on them once or twice, but otherwise they'll really start to to hurt. Colleen SchnettlerYeah.Michele HansenBut it's also kind of normal. Like, you know, you know, as I mentioned, I dealt with this in my first job, and I would say that one of my favorite activities was what I just simply called finding money, which was when It turned out that we had to accidentally, like not billed a client for six months like, because things hadn't been centralized before I was in that role or other things. And I would just go into my boss's office and be like, "Guess what! I found $3,000 today!" Like, it's just, it's so satisfying when you can close those things out. Yeah, it's a tough balance between the boring and the exciting. Colleen SchnettlerYep, sure. Michele HansenEnough about my boring stuff Colleen. What do you got? This is this is the good stuff that people want to hear about right now.Colleen Schnettler 10:36 Well, I feel like I'm in a really exciting, you know, phase of this building a business, right, like, just launched. So it's invite only. I'm trying to get my I haven't really started trying, I'm gonna try next week to get my 10 users and it you know, I'm full of energy and optimism right now. And, and so that's that's kind of a nice feeling. Although I am aware, as we've discussed before, like, now is when the real work begins. But one exciting thing that happened to me is, a few people watched our video podcast last week, and reached out to me and asked me if they could help me test the product. Michele HansenYeah? Colleen SchnettlerAnd so yeah, isn't that awesome? Michele HansenThat's so awesome. Colleen SchnettlerI thought so. And so I asked them if they would do a call. And they agreed. So I have two calls next week, with people who might want to use my product. Michele HansenThat's so exciting. Colleen SchnettlerYeah, I'm pretty excited. I'm really happy they did that. Yeah. If anyone else wants to use my product, please let me know. I think it'd be really nice to kind of get it in front of people see what their problems are. And see if this is a solution that can meet other people's needs, as well as my own need. So I'm kind of approaching it -- we've talked about the difference before on this podcast between customer interviews. And what do you call it user interface? You guys were changing your dashboard. And you were like.Michele Hansen 12:15 Oh, yeah. Oh, actually, we released that this week. And that was kind of exciting.Colleen Schnettler 12:18 That's exciting.Michele Hansen 12:21 Yeah, so there's usability testing, user interviews. But then there's also sort of user onboarding, which may be these calls sounds like they're more like onboarding and sort of trying to figure out what what what they're trying to solve, but but in a very solution focused kind of way, rather than a, the exploratory solution agnostic way that a customer interview often is.Colleen Schnettler 12:53 Right? Yes. That's kind of how I'm approaching it. I hope to, while I'm chatting with them to Yes, see how the onboarding is at the moment, because it is very shaky. I mean, the documentation, I just started reading the documentation, right. So the documentation is very sparse. And I, the nice thing about starting with a marketplace is that they force you to write really extensive documentation. So it's almost like it's kind of forcing you to have that discipline to actually write it down. Like I know, people with great products and no documentation, and they wonder why they can't sell it.Michele Hansen 13:32 Like, what? How do you launch something without telling anybody how to use it?Colleen Schnettler 13:37 I don't know. I think it's common with developers because we make this because it's the shiny object syndrome, right? It's fun to make the thing. It's not fun to spend hours and hours trying to write down how to use the thing that seems obvious to you because you created it.Michele Hansen 13:52 When you're an electrical engineer. When you were in college, did you ever have to write technical documentation? Like instead of having English class, did you have like, tech, technical documentation writing class?Colleen Schnettler 14:08 No.Michele Hansenreally?Colleen SchnettlerThat wasn't a thing? Well, that was almost 15 years ago. And I think they have since learned, and I'm pretty sure they offer technical writing now. But I've been thinking about this a lot, because I'm about to start this marketing journey. And I don't know anything about marketing. So Alex Hillman has a great article about this on Medium called The Fear of Beginning Again, and it's about how with the course he runs with Amy Hoy, how so many of their students are very talented designers and developers. And they're taking these designers and developers and they're trying to teach them a completely new skill, and how so much of the challenges their students face are psychology based. And one of my favorite quotes is he says, quote, but when these creative pros sat down to learn a new skill from scratch, where very few of their existing skills translate, they lose their freakin minds. And that really resonated with me because it's hard to start over. And you've worked so hard to get where you are in your current craft or trade, you know, this whole concept of Wow, now I have to start over again and learn this new thing. So it's not bad, I'm excited about it. But at the same time, I've worked so hard to build competence in a specific field. It's almost like I'm changing fields, and starting again, anyway, so there's just a lot of like, ego and like self evaluation, I'm finding kind of going down this path. It's really weird.Michele Hansen 15:42 Yeah, I think we all do a disservice when we discount other types of expertise, especially as bootstrappers when, you know, you have to wear many different hats and sew your own hats as well. Colleen SchnettlerYesMichele HansenLike, you have to be able to do all of it. Like, you know, I like my background is, as a product manager. It's not an accounting. But I have to do that. And that's also something that my husband has to deal with as well, because he's dealing with Stripe, like he's not, you know...you have to do a lot of different things and be able to appreciate that things outside of your sort of home expertise are worthy, and complicated, and capable of being interesting or even beautiful in their own right. Colleen SchnettlerYeah.Michele HansenTo get us back on track, I know that you are a huge reader of books, and there's a voracious reader when it comes to doing anything new. And so I'm really curious what the resources are that you have honed in on as you start this marketing journey.Colleen Schnettler 16:55 My resources are named Michele. Michele HansenOh, okay, well, I have some books for you... Colleen SchnettlerDo you have any suggestions? Because I'm, like, totally new to marketing. But I know that I don't wanna say it's easy to make good tech, but it's kind of easy to make good tech, everyone has good tech, this is what's gonna make or break it, whether it's this image service, or whether it's a whole other business, like, I have to learn this stuff, because this is gonna make or break me when I you know, if I want to real business. So let me know your recommendations. Michele Hansen 17:20 There's a really good one that a lot of people recommend, as well called, Obviously Awesome. That's all about writing, copy. And framing. Another one I really like, is Creating [sic: Building] a Storybrand which you may seem like for a technical product, like, how does that how does that apply? Right, like, you know, I think is very clear how it applies in B2C. But in, in, in B2B, it applies as well. And basically, the idea of that is that your product is not the star of the show. It's actually the user and the person buying it like they are the hero. And your -- what your product does is it elevates them to do what they do better or, or faster. And, and it's so fascinating, because it goes into how storytellers you know, people who write movies and books and whatnot, how they construct stories and how you have the main character of the story, but maybe they have a goal, or maybe they don't know what it is, but then they meet this guide, who helps steer them in a direction and helps them refine their goal, and they, the hero goes through a journey and whatnot. And it's basically saying that, you know, your product is not the hero. Your product is the guide. And so how do you frame that in your copy that it's not just, this is an image management service. This is spend more time on things that are impactful for your clients or, or like whatever those sorts of things are, you know. I'm reminded of, actually, I'm reminded of my -- one of my brother in law's he launched a sort of handyman and lawn maintenance business in January of this year. And like talking to him about like, what his slogan should be and whatnot. And I remember some of the early drafts of it were things like, you know, we handle all the things you don't want to or we can do all of this or and it was like very much framed out like what the company could do, right? And we're like, but how do we frame this from the customer's perspective. And the slogan he ended up coming up with I think, was along the lines of "Your house can look good." Because it's something that people want it to believe about themselves, they want it to believe about their house, but they need a guide in the form of his company to get there. So it's not that his company is the hero that comes in and saves the day, which, like a lot of products kind of frame themselves that way that like, we're going to save you from what you're dealing with right now. It's instead No, like, you are capable of more. And our company will just give you that little push that you needed to get there. Like it was already within you, you I might talking about The Karate Kid or whatnot right now, or am I talking about landing pages, right? And so and so Obviously Awesome and and Storybrand are two really good places to start. They're not going to be super in depth on like, you know, these are the parts of a great landing page. And, and this is how you optimize for SEO and, and all the things like that. But they'll give you at least a good start to thinking about it from your customers perspective and the kinds of things that you need there and the way you write about them, too.Colleen Schnettler 20:59 Yeah, I took a stab at trying to -- after we did our video podcast last week, I felt like I didn't explain it to you very well, like rewatching it. So I took a stab at kind of like narrowing down those bullet points. And that's what I was like, Oh, this is really hard. Like, I know why is great. But But how do you frame that in a different way? So that's awesome. I'm definitely gonna check that check out those resources.Michele Hansen 21:22 Do you have any drafts of that framing that you've come up with so far?Colleen Schnettler 21:27 Well, yes, I do. Now, I was not intending to share this this early. But this is what I got so far: "Dead simple file, uploading and storage. Simple file upload handles all the heavy lifting of uploading user files to the cloud returning a CDN URL for you to use whenever you need!"Michele Hansen 21:46 Do you think that frames the product as the hero or the guide? Colleen Schnettler 21:51 The hero. Because I'm not now that you've just said that? Like, I'm not saying anything about how I'm guiding you to have a better life.Michele Hansen 21:59 Yeah, and yeah, I just thought of one of my favorite places to find examples of good marketing is actually Good Marketing on Twitter, I think they just changed the name to like Harry's marketing examples, or what it was called good marketing for a while. And he basically just does a ton of product tear downs, I'll take up the exact link to the Twitter account and, and put it in the transcript. So good, like, like he goes through different landing pages has like, this is why this is good. And this is what they're doing here. And, and I get so many ideas from that.Colleen Schnettler 22:36 Awesome. That's exactly. I feel like I need to start immersing myself in that world because I like I don't interact with that world at all. So yes, that's the kind of content I want to be getting into now is like that kind of stuff to get an idea, because I'm telling you that little snippet sentence that was not impressive. I was like, that took me a while. It was not as easy as the marketing people make it look.Michele Hansen 23:01 It's hard. And I'll say like, I looked at marketing examples for a long time. But until I read those books, I didn't really get why they worked. And I didn't really know how to frame things myself, like, you know, take those examples, and then transform that inspiration into something that works for our products. It became a lot easier, like having those those books as the underpinning and especially if you're already doing customer interviews, you're going to have a library, whether that's, you know, in, in Notion or in your head, of what are the things my customers are saying? What are the things they're frustrated about? What are the ways they describe what they're frustrated about and ways they describe their process? And how can I use those words that they are already using to create marketing that puts them as the hero? It's, it's really, really hard. I definitely don't think I have it figured out by any means.Colleen Schnettler 24:04 Yeah, well, and like I said, I'm hoping that talking to these guys next week will just help me figure out, you know, if their problem is that did they frame their problem in the same way, for all I know, they're framing their problem a completely different way, or they're attacking it a different way. So I'm really excited and grateful for their time and excited to kind of see how this impacts them in terms of what they want to build. The interesting thing is they're both fellow indie hackers, they both have small SaaSes. So it makes me think I had originally thought and this is only two people. Okay, so this is not to base a decision on. But one of the things we talked about with my product specifically, is it's aimed at developers. But most developers, especially developers with like a full time job, they're going to have some really complicated solution they spent hours on and probably already works, whereas what I'm building might be more appropriate for people who are trying to get something together quickly people who have a SaaS, as we discussed many, many episodes ago, people in the no code space that just want a thing they can just throw in there. So I'm kind of like I said, I'm excited to kind of start looking at these different avenues and, and see, see where it goes.Michele Hansen 25:19 Yeah, I bet there are some no coders listening to our podcast. I mean, that's a huge thing now. And I'd be really curious to see if if they experienced this problem, too.Colleen Schnettler 25:31 Yeah, yeah. Because I that's an avenue, I really want to learn more about because I don't do a lot with no code. So I'm pumped to kind of learn more about that. And see what that's all about.Michele Hansen 25:44 And don't make decisions based on two people.Colleen Schnettler I won't.Michele HansenThe absolute men is five people, before you really like and that's and that's if you've, if you've heard the same thing, basically, from those five people, then Okay, that that's a pretty strong, directional signal. But I mean, I've had so many times when, you know, when, especially when I first started doing user interviews and user testing, like you put in front of one person, and it doesn't make sense. And then you change it. And then you do the next person. And actually, they needed another way. And you're like, ah, I could have saved myself so much work just by being patient.Colleen Schnettler 26:16 Yeah, that's good advice. So I got to get my 10 people signed up. So I hope to do that next week. And you know, of those 10 people, how many are actually using it, as we talked about, and how many are just like being nice. And being my friend and getting me into beta? I'm not sure. But of the people who are actually like, interested in using it, I'm going to try and talk to as many of them that will talk to me. Because I think, you know, that'll really help me just kind of see where people are and where their thought processes are. Michele HansenAbsolutely. Colleen SchnettlerSo yeah, so that's what's been going on. So like the launch is, it's just exciting. I mean, it's just kind of nice. I think we've talked about this before as well, like, I just needed the psychological win. Michele HansenYeah.Colleen SchnettlerLike up shipping, something I totally get the the concept of you should definitely talk to people before you build anything. I understand that. And when I hear about really successful businesses, most of them did that. Right. They talk to customers before they build anything. But I am just at a point where I just need to psychological when of shipping something. And so I'm pumped. So I'm good. Like, I'm excited. And I hope that you know, when we talk next week, I've at least signed up to 10 people. I can't get to beta till I'm done on my documentation. So that's quite a lot of work as well. Like they have very specific requirements and like ways they want you to structure your documentation in the marketplace. So I don't think I'll be in beta next week. We'll see how everything else goes in life. But yeah, I'm like in that kind of fun, exciting just getting rolling stage.Michele Hansen 27:52 Exciting. Well till next week.Colleen Schnettler 27:54 Yep. Thank you for listening. You can reach us at on Twitter at softwaresocpod and we'd love to hear from you. Thanks.
The Reveal!
See Colleen's product! Video at https://youtu.be/vdO7uFT63dwTRANSCRIPTMichele Hansen 0:00 We're doing something a little bit different. Colleen's product is ready to have a little walkthrough of it. So this will be the first time I'm seeing it. So we're doing something different. This week's episode is going to be a podcast as normal, but it is also going to be a video. So you can see what Colleen's product looks like. So hopefully this is just as enjoyable as whether you're listening to the podcast, or you're watching the video, we'll put a link to the YouTube video in the shownotes. Definitely let us know what you think of the format. And hopefully, it's interesting. Colleen Schnettler 0:49 Okay, this is great. I'm super pumped to show you this. Michele, I'm going to share my screen with you so you can see it. Alright, can you see my screen? Yes. All right. So let's start from what the very beginning kind of what I'm trying to accomplish here. So this window right here that says new listing details, let's say this is your existing user interface. So your user is adding listings for I don't know, an event or a real estate site or something like that. So what you a typical kind of quick, easy implementation is just your typical HTML file tag, which is what you have right here. Now, I have found this to be like, really ugly, and I just don't care for it the way it looks. And plus, even if you're importing a file, this way, you still are responsible for setting up your cloud storage account, as we've talked about ad infinitum I know, but basically, you still have to get all the other back end stuff set up. So what you do is you would go to Heroku, you'd provision my application, and then you'd sign on to my application. And I would give you this script, like so basically, and I have not finished or like really worked out the documentation yet. But basically, I'm going to have a site, like once you've signed up for my application that says, Put this script in the head of your file of your website. So then you add this script to your site, save it, I'm running this locally, so we could see the changes kind of as they're happening. And now you get something like this. So Oh, thanks.Michele Hansen 2:29 Well, there's a drop file.Colleen Schnettler 2:31 Now there's a drop file, boxyMichele Hansen 2:33 way of having, right.Colleen Schnettler 2:35 So and I think one of the things that's really important here is I think, Heroku, I could be wrong, but like, it's mostly like Node and Rails developers. So there's people that are more focused on the back end. So anything I can do to make the UI less painful for you, is what I want to do. So So I worked for an events company at one time, so we had to deal with tons of images. And we implemented a drop zone like this, but we had so many problems with users trying to drop files that were too big files of the incorrect, you know, format, things like that. So what this does for you is if I wanted to drop some images, so if I try to drop a file, right now, I want to say I have a two Meg limit. And I'm probably going to change that I haven't worked out that detail yet. Let's say I have a two Meg limit. So if you try to drop a file that's bigger than two Meg's you're going to get this exe. And it's going to tell you the files too big. And then it's going to remove the file from the drop zone. So your user can drop a new file.Michele Hansen 3:36 Ah.Colleen Schnettler 3:38 okay. So I mean, even that I have a lot of like thoughts about like, right now you drop it, you and it's a timeout, like, I don't know if I should wait and let the user exit out. Or, you know howUnknown Speaker 3:51 littleMichele Hansen 3:52 quick I didn't get to fully read read it the text until the second time. You did it, because youColleen Schnettler 3:59 need to look for it the second time. Yeah, IMichele Hansen 4:02 didn't really know what was going to happen. But I knew there was some errors. So yeah, I would probably try to upload it twice just to see what that error was.Colleen Schnettler 4:13 Okay, that's good feedback. And again, I can slow it down. I mean, maybe I should slow it down a little bit.Michele Hansen 4:20 I also wonder about accessibility for that.Colleen Schnettler 4:24 Right. That is an excellent point. I will look into that, because that's definitely something I need to address. That's a really good point. So that's kind of what I have now. And those are two good comments for a bad file. But what I really have gone back and forth, and left and right about is what about a good file. So let's drop a good file in here. And so there's all kinds of things I can do here and I'm probably just overthinking it, but like how opinion Am I going to be like that little green checkmark? Should that stay? Should I go? Should I keep the reason I kept I went back and forth on keeping this dashed blue line. And the reason I kept it was to show you if you change your mind, you can just drop a new file in there, right? You can,Michele Hansen 5:18 yeah. And I guess, to me, a dashed line around the image implies that it's in a draft state and that they need to do something else in order for that to be saved.Colleen Schnettler 5:29 Okay, that is what you think. Okay. Yeah, cuz I went back and forth on that. Like, should I read, because what I had originally, is I actually removed the drop zone and just put the image on the page. But when I removed the job zone, I then had to add a button so that they could bring the drop zone back up. So it started to get more complicated.Michele Hansen 5:53 And I noticed that it shows the file size, even when the file size is an acceptable size. Yes, you walk me through why that is?Colleen Schnettler 6:03 I think that's partially like, you know, when I started this, I was just trying to kind of keep track. So I would know immediately, like, Oh, this one is one fits, this one doesn't fit. But I, you know, have no strong opinions about whether that's helpful or whether the user even cares, which probably they don't care, right. They just want to know if it's successful or not.Michele Hansen 6:28 Yeah, I, I would be curious to I mean, maybe there are people who get value out of that, maybe I won't discount that.Colleen Schnettler 6:36 So I was showing this to a friend of mine. And he has a few apps on Heroku. And he suggested accepting other file types. Because his point was, if you have a really image heavy site, you're probably already using one of the big players in the image, site market. But there's a huge problem with like, if you want to email someone a PDF, or, you know, you're collecting resumes, or all the other kinds of file types that people might want to upload. So that kind of gets interesting, because then I was thinking, Okay, let's say we want I have a PDF here for my children's school, welcome newsletter. So if I try to drop a PDF, that works, but I don't ever have any kind of preview image. So you think that I mean, should I just leave it like that? You have thoughts on that?Michele Hansen 7:24 Is there some sort of icon you can use for the image or file type like,Colleen Schnettler 7:30 like a PDF icon? Yeah, that's a good idea. pdf. And maybe like, same thing for like a Word document or something like that.Michele Hansen 7:42 I, you can even just have an icon that just represents a document in general.Colleen Schnettler 7:47 That's way easier. So this is what I'm talking about. I like it, simplify one.Michele Hansen 7:51 One, I upload something that isn't a document, like an Excel file, orColleen Schnettler 7:58 Well, I'm not. That's what I got to decide to. And maybe I don't, I'm not at the point now where I really need to, to, like, specify that. But I can just touch like, this isMichele Hansen 8:10 really where you listen to your early users, right? So like, yeah, somebody who starts using it. And, you know, somebody sends you a support email and says, Hey, I love this, but I really need it to support Excel files, like Can you do that for me? Thanks. And what I would do, when that happens, is saying, thanks so much for reaching out. Can you tell me more about why you need Excel files? And like, how does this fit into your process? And like, what you're currently trying to use and why it doesn't work, and really drill into what their use case is. And it could turn out that somebody with weird file types that you haven't thought about, or I mean, Excel is not a weird file type, but it's not an image. Right. Right, um, that they could have a use case that is actually much more valuable to you as a business owner than something else. Yeah. I mean, it's a good sign that, you know, if you're getting feedback like that, I wouldn't necessarily need to say you need to support every single file type under the sun. When you launch. Yeah. Especially if that first hurdle is getting 10 users. So like, you know, find people who need images or you know, adding PDFs is something that someone has already expressed a need for. Then Then do that, butColleen Schnettler 9:29 Okay, yeah, no, that's, that's great. In a way,Michele Hansen 9:32 yes. add things to the pile before launching,Colleen Schnettler 9:35 right. And this is, you know, I think I even tweeted about it, like, I feel like that is that is part of this journey is trying to just decrease the scope, decrease the scope, like just get something you can get out there. And then if people use it, see what they have to say about it. Okay, so I want to show you something else. I've gone back and forth on a lot. And I actually had this different than I changed it. Okay, So let's say you have an image great. Woman in pink dress.Michele Hansen 10:06 Okay, so what is going to ask you what happens if you try to save it without naming it?Colleen Schnettler 10:13 Well, that would depend, I mean it so the image is still going to save. So this would be that would be dependent on the clients on the client's back end, like, I don't have anything to do with that, all I'm doing, what I'm really doing is I'm just replacing your file input with this drop zone. And your image, if it uploads, like it gets, it gets saved. So even if it's, there's like a failure on the client side, the image will still exist, so they can still save the image, even if they don't have a name for it. Like I don't, I don't have any requirements that you have a name for, because I'm keeping track of the name for itMichele Hansen 10:49 like mine, you're just using their file name. Yeah. Okay.Colleen Schnettler 10:52 So this is something I wanted to show you, let's say that you go in, you have this in your form, your user drops an image, it's good. And they create, okay?So little slow, because I'm running it locally. Okay, so let's say this is, so this would all happen. This is pretend this, this site we're looking at is a user's website, right. So they can choose whether to show the image here or not. Now, if you go into edit it, look what happens. So I went back and forth on whether to send the image in here. And the reason I decided not to is because if the user wants to show the image, they can just add an image tag here with the image. Like I say, user, I need to I'm gonna use the term client to refer to the person putting this in their website. So let me show you this. So I can like make this more. So this is like, all you had before. Now, if you want it, you can add the image tag if you want. But that's something they would have to do in their HTML. That is not something I am doing for them. The reason I didn't is because I thought I didn't want to be that opinionated about what the image should look like. So let's say you want to show the user the image before they change it. But what if you want a bigger? What if you want a huge image right here? or what have you wanted smaller? So you have to add your own image tag? And what if it's a PDF document, you don't want to show anything? Because you don't have a preview for that? So this is all I'm providing right now.Michele Hansen 12:38 So are you providing this edit functionality? Or is this just a functionality of the demo? No, you have createdColleen Schnettler 12:46 this is just let me show you something. So, um, let's just like, I just want to show kind of show you what I'm talking about. So let's say you upload an image. Alright. So what's happening is your image is getting put to, you know, put behind a CDN, and I just give you a URL. So you, and by you, I mean, you're my client, you are responsible for saving that URL on your listing associated with this listing ID. So I am not providing like any of the Edit functionality, literally, all I do is I find your file field input, and I replace it with the drop zone. And then I take the URL, and I put it in the value. So you can save it in your form like usual. But I'm not providing like extra, like, so if you came in here, like I said, so this is the thing. Okay, I'm looking at my listing, I hit Edit before, this was a file field. And so I'm just replacing that file field with my widget, and I'm just accepting whatever you drop.Michele Hansen 13:57 And so there is no one can say there would be like, they can show the image, right? Like the client can decide to show the image to the user and have that functionality instead be replace,Colleen Schnettler 14:10 right? So the user, the user can choose to show the image, but they would have to put it because it's not button activated. They would have to like, it's it's kind of not great, because they would have to like put the image here and drop a new image here. I have no way right now of showing the image in the existing drop zone.Michele Hansen 14:35 I guess I wouldn't expect to see an image in a drop zone because a drop zone is an empty vessel. And as long as you know, the client, I guess that's the person who is using your service as long as they have the ability to show the file themselves.Colleen Schnettler 14:59 Yes, which they DoMichele Hansen 15:00 its storing the file, right? Yeah, yeah. You know, they can recall the file. Like they can design whatever UI they want. But like thinking about drop zones we have on geocode do. Like none of them have any content in them. Like they're designed to just be some somewhere that youColleen Schnettler 15:19 drop a files. Okay? Yes, that's kind of what I've been going back and forth on is how opinionated should I be? And I kind of came to that same conclusion plus, like I said, that gives them more control over the size of everything and the aspect ratio and whatever else they want, whatever else they care about. But yeah, so they would show the image like right here, or they could show it wherever they wanted. And then you could just have an update image. It's not button activated, because I didn't want it to be button activated. But it's another thing that I was like, Should I add that functionality? So you can open it with a button? Or should I just show it?Michele Hansen 15:58 What do you mean by open it with a button. SoColleen Schnettler 16:00 instead of having a drop zone here, I think in my first time, I just had a button that said, upload file, and that then populated the drop zone here?Michele Hansen 16:11 Oh, so it opened up the person's file is sitting on their computer, and then they have to search for it. Rather than dragging something in?Colleen Schnettler 16:19 Well, no, it like there was a button here. And you clicked it. And then it put this here. Instead of starting with it here, like because right now it loads. The drop zone is already there. When it loads instead of most of the widgets do a thing where like, you have to click a button. But I don't like my users don't like I don't knowMichele Hansen 16:39 why you would put another step in between. But I guess I do wonder about people who aren't familiar with drop zones.Colleen Schnettler 16:50 But you can still click here. Like I just shortened the language. Yeah, I mean, you don't have to drop it. It should as I say that, yeah, you should just be able to click it. And it'll open your local file system. There you go. So yeah, so that's kind of where I am with all of that. I mean, you know, so much of it is opinionated, like, what does it look like you What if you don't like the color, I go back and forth, so many times between allowing them because they could theoretically specify all of that. But I'm trying not to get ahead of myself and give them right now they have zero configuration options, just because that makes their integration super easy, right. And I think I call it a calling it simple file upload. So let's not give you 100 options.Michele Hansen 17:38 I think at this point, allowing them to change colors is not an essential feature, like the ability to change the colors on the widget, maybe important to some clients or you know, really to the clients, clients who, as I mean, people who have both dealt with clients, we know that clients can be very opinionated about colors, and especially the matching branding and everything else, right. But is that a feature that will prevent you from launching to 10 users now and determine whether people find the functionality of the service? And ultimately, the time savings? and frustration savings of the service valuable? Does the ability to customize color impact that? I don'tColleen Schnettler 18:29 think so? When so I was trying to think back to like, what are the most frustrating things for me with this process that I'm taking away from you. dropzone, some callbacks, like errors, checking for all those errors. That's kind of always been a pain and getting the you're getting a UI that you like, with with error checking. And then again, like this, in this way, you don't have to set up the cloud storage, you don't have to set up the CDN. Like that's all already provided for you out of the box.Michele Hansen 18:58 Can your customers specify what the maximum file sizes like? I can let have a reason.Colleen Schnettler 19:05 I mean, I can let them I thought about that. I don't think I'm going to do that now because I want to keep it small because you know, I'm happy to say thatMichele Hansen 19:14 musicColleen Schnettler 19:18 but I mean they could theoretically yeah I guess I'm just stuck in all these like loops of like, should I do this? Should I do this? And like I kind of just I kind of want you to tell me it's fine just the way it is. What do you think fine, just the way it is?Michele Hansen 19:33 No, um, no. So like, let's go through those things. Okay. Now, right that like you said, You've been going back and forth on the the ability to replace the images it but it sounds It sounds like you have a you know, a strong reason why the image should not populate in the drop zone. You talked about the error messages and kind of going back and forth on on that, and maybe there's a little bit needs to be done there. And and I would probably say the accessibility just think that at least looking into that should be should should be checked before you launch. Okay, um, what else is an outstanding? going back and forth on it item at this point?Colleen Schnettler 20:24 Do I need to allow them to have more than one on a page?Michele Hansen 20:30 I think that's something you could ask them?Colleen Schnettler 20:34 Well, I don't have any of them yet. because no one's using my theoretical balance. I mean, I could just the problem is net, what would happen now I like,Michele Hansen 20:45 couldn't they?Colleen Schnettler 20:46 They can I just have, it's actually not a huge deal for me to do it. I just have not implemented that yet. I mean, that's not even a ton of work.Michele Hansen 20:54 on it, I guess I'm wondering like, why, like, what is the scenario where they would have multiple on one page?Colleen Schnettler 21:00 Oh, so I have a client that does that. And they do it because they allow. They allow their users to upload multiple images, but they have it set up. So they can like upload an image here and give it a caption, and then an image here, they have like five of these things next to each other, whether that's a good UI, or not as a different question. But um, so they, they haven't like, you upload one, and then there's like a box here. And so you're right, you know, your caption, then you upload another one, and you write your caption, then you upload another one, and you write your caption.Michele Hansen 21:34 So one of the fundamental jobs of this service from a sort of job span perspective, is to reduce your frustration when dealing with your clients. And you saying, oh, one of my clients has an experience where people need to be able to upload multiple ones on the same page. And it doesn't totally make sense. But they want that, and it's how it's set up. That to me says that's something you should add, because that goes for your core reason for creating the service.Colleen Schnettler 22:09 Yeah, that's an excellent point. Yeah, I'm excited to actually get to use it myself.Michele Hansen 22:20 It's gonna be so great. And that'll give you so much motivation to like, keep going.Colleen Schnettler 22:25 Yeah. Yeah, I think so. I absolutely think so because I continue to refine it. As I said, like, even if I'm the only one using it, like, it makes me happy. And, you know, since I'm using it, I can continue to refine it. As as I go forward, and kind of figure out what what I need to do and what I want to do.Michele Hansen 22:44 So what else is kind of outstanding? You're trying to think about or stands in the way of you watching at this point?Colleen Schnettler 22:51 Um, let's see. I mean, nothing really, I got my AWS budget set up. So AWS isn't going to screw me over. And andMichele Hansen 23:08 how did you budget?Colleen Schnettler 23:10 Ah, well, I applied for one of their Are you starting a new business grants? And if I get it, it should be like $1,000 towards AWS services? So that would be helpful. I don't know. I guess I should be more worried about it. But it's like a What is that thing? It's like a Lamborghini problem. And like, I don't have any Lamborghinis. Right. My problems are small. I have like Toyota Camry problems. Like, I just want someone to use it. They're like, Oh, when you get 100,000, you know, when you get thousands of customers, and I'm like, that's great. Like, I just don't know if that's anywhere in my future. So I'm not worried about it yet.Michele Hansen 23:49 As someone said to me once worried about success when it happens,Colleen Schnettler 23:52 right? That's how I feel like I put enough thanks to, you know, to some kind people in some AWS research, I put enough stopgaps in place that if something goes rogue, like, I can handle it, and I did a couple things up front that enabled me like I'm using a custom domain so I can switch off of AWS if I have to down the road. But like, I, you know, I'm not, I'm not worried about it. I'm worried about this first step. And this first step is 10 people pretending to use it, you know,Michele Hansen 24:21 so towards that first step, I noticed that the partner portal in Heroku is open in your tabs. shez. Is there a reason why that's there? I mean,Colleen Schnettler 24:33 it's there. Look, no add ons. Bam. It's there, man. Like I could Oh, right. Yeah. Yeah. So I could theoretically like get my 10 people today. I mean, I could get my 10 people today. I mean, it's there it works. Um, so yeah, so it's already there. I've already done the integration. As I told you last week, I was going to my goal was to get that integration done. So I got the integration done by Yeah, like I've done the what is stopping me really like I need to look into accessibility are 100%? Correct. But no I can. I don't want to get my 10 people until it works cuz I get maybe five seconds of their attention. So if they try to install it and something goes wrong, then I lose their attentionMichele Hansen 25:18 to what we were talking about last week, I think it's worth remembering that in a professional context where if there's somebody who has similar frustrations as you, they might be willing to send you a support email and say, Hey, I was really excited about this. I really wanted to use it. But I noticed that I went to install it and x happened, or I tried to use it in this case, and it didn't work. Like they will have motivation to use it in a way that if you're doing a consumer app, that's that is often not present.Colleen Schnettler 25:57 Yeah, right. You're saying yes.Michele Hansen 26:00 And, and so I think that's, like, we still have bugs that we're squashing like no fire? I don'tColleen Schnettler 26:07 believe you. Oh,Unknown Speaker 26:13 yeah.Colleen Schnettler 26:15 No, I, I understand your point, like,Michele Hansen 26:18 the 4:30am. Phone calls we get from different, not too often.Colleen Schnettler 26:25 Oh, my goodness.Michele Hansen 26:27 Not right, like nothing is perfect. Like, that's how it is. But if you have built something that somebody needs, or they can see is going to reduce some frustration or friction for them. And it turns out that there's, you know, something is wrong with it, and you need a week to fix it, and you come back to them in a week, like, their process that annoys them still exists. Right? And you're not just making you know, something for consumers, that is entertainment, where I mean, we both been, that's a good point, you have them for five seconds. And then if you don't help them right away, they're gone. Gone. That is not this scenario, and that's something I love about being in b2b is that you are like creating things that are just making existing processes better or cheaper, or faster or less annoying. And and so that process exists, regardless of whether your product exists, or not. Right? Mm hmm. And, you know, of course, in you know, in consumer, they need to be entertained or whatnot. Like those things always exist, but they are filled in so many different ways. But right, if somebody is creating a product for a client, and they need these image uploads, and then they have some more frustrations as you then then I think they would be more willing to give you some time to fix it. That then you might be able to imagine,Colleen Schnettler 28:00 okay, I'm open to that. I like it. So I really think that like then there's no reason I can't start getting people like Monday. So I like doing weekly goals. I like doing weekly goals with you. Let's say by next Thursday, when we have our next podcast. I will try to have gotten those 10 people or at least be looking for them.Michele Hansen 28:25 You will be live in theUnknown Speaker 28:29 store.Colleen Schnettler 28:29 Ah, that's so exciting. Yeah, that's super exciting. Yeah. All right. So that's my goal for this week. That's awesome.Michele Hansen 28:39 stuff will go wrong. But stuff will go right. Yeah. And the most important thing is reducing your frustration with this problem. Right? Right.Colleen Schnettler 28:49 Yeah, absolutely. That was the whole this was the whole reason.Michele Hansen 28:53 Even if you're the only user.Colleen Schnettler 28:55 Yeah. Awesome. Awesome. Well, thanks, Michele. I really enjoyed going through this with you. And I really appreciate your feedback.Michele Hansen 29:05 I love doing this. Like, I love workshopping with people. And you know, I always find that when I'm creating something. I don't ever really fully appreciate it or understand it or see all the issues with it until nobody else is looking at it. And you know, having a friend that you can do a tear down and then demo and everything with is. Yeah, it is just always so helpful.Colleen Schnettler 29:31 Yeah, awesome. Yeah.Michele Hansen 29:34 Okay, so listeners, we hope that you've enjoyed this little walkthrough of Colleen's simple file upload service, soon to be available on Heroku. And we hope you enjoy the video podcast component of it as well definitely. Let us know what you think.
Negotiations... with Customers and Oneself
Michele Hansen Welcome back to software social. I'm Michele Hansen.Colleen Schnettler And I'm Colleen Schnettler. So Michele, what's been on your mind this week?Michele Hansen So after our conversation with Alex last week, which, by the way was so fun, I feel like we got to talk to him about like, a 10th of the things I wanted to talk about. I have been thinking a lot about what I got out of my own MBA, because his book, The Tiny MBA, and we talked about this a little bit about the differences between between that and and it's just made me reflect on some of the things I got out of mine. And one of those things is negotiation skills. Colleen Schnettler Okay. Michele Hansen I really learned in that program just how much of a wuss I was at negotiations. <laughter>I got to do this trip to India and the UAE and we were visiting factories and and whatnot and part of it, you know, being an India, was going to the markets. And our professor was very keen that we learn how to negotiate and I remember we would, you know, go out and buy things and our graduate assistant student in the program was from India and we would always go to him and be like, hey, like, you know, I got this scarf and you know, I got them down from from this price to this price. And he would always like, shake his head and be like, you could have done so much better than that, like you just got totally ripped off. And I remember feeling like oh my god, like and, and I realized that experience -- getting my ass kicked by India -- made me realize how little I knew about negotiation. And, and so I ended up taking a class on it.Colleen Schnettler Oh, when you were getting your MBA, you took a class specifically on negotiation?Michele Hansen Yeah.Colleen Schnettler Oh, that's awesome. Michele HansenYeah, it was awesome. And we got to do exercises, simulating negotiations and learning about different styles of negotiation, and different tactics to use. And the really, the big thing I got out of that was that you don't have to be a hard negotiator, you don't have to be mean, in order to be a good negotiator. And, and I feel like this is something that we don't have a lot of cultural exposure to negotiation, right. You know, unlike my, you know, fellow student who grew up in India and buying groceries or buying anything involved, negotiation and haggling. I didn't really observe a lot of negotiation as a child or as a teenager, right? Like, Can you recall observing that very much?Colleen Schnettler No, the price is what it is and you pay for it or you don't.Michele Hansen Yeah, exactly. So, um, and so I think my understanding of negotiation was very much guided by pop culture figures who are known for being you know, hard charging and you know, screwing the other side basically right like, and so I just kind of I always shied away from negotiation. But negotiation is really, really important in running a business, especially once you start dealing with enterprise customers who pretty much always want to negotiate. They're not going to, you know, just sign up for a plan on the site and then just pay for that, especially on an annual basis and then things like that. And, and so I learned that you can be a good negotiator and get what you need out of an agreement. But you don't have to be mean and you don't have to, like bend over to them, either.Colleen Schnettler Okay, so let's dive into this cuz... Michele Hansen Yes!Colleen Schnettler I think negotiation is a fascinating topic, especially for women. I have negotiated salaries and I remember like the first time I negotiated a salary, it was like, you should always negotiate But to your earlier point, like I have no experience in negotiating. So you just kind of pick a number. You're like, Oh, this is my number. Like, let's talk a little bit more about some of these tactics and like, how does one negotiate without being a jerk?Michele Hansen Yeah, so one of the most important things to remember in negotiation is knowing your BATNA.Colleen Schnettler What's a BATNA?Michele Hansen Your BATNA is a best alternative to a negotiated agreement.Colleen Schnettler Did you make that up?Michele Hansen I did not make that up. This is actually a term that like is in every piece of negotiation literature. Basically, you know, some people think of this as leverage or as your power or but it's basically your alternative, right? Like if you don't negotiate this, like if you walk away from that job, what is your alternative? And, but you always have to think about your BATNA and then your counterparty's BATNA, and maybe way to think about this is it has The word bat in it, right? Your BATNA is what allows you to fly away.Colleen Schnettler Okay, so let's use your example. I like concrete examples when I'm trying to understand this. Are you comfortable? Like you can make up numbers? But let's say you're negotiating with an enterprise client. So when you say BATNA, you mean that is your number you won't go lower than.Michele Hansen That's a reservation price.Colleen Schnettler That's different reservation price. Okay?Michele Hansen So um, so your BATNA is basically your alternatives. So, for example, let's say that you...Okay, here, here's an example. Let's say you run a customer support platform. So these things out there like intercom and whatnot. So your customers, your customers' BATNA, right, so their alternative is are there they can use one of your competitors. But maybe they don't have all of your features like maybe, let's say, you do chat and email and knowledge management. They can use one of your competitors, but they don't have one of those features. So that's their best alternative. Or they can use three different services that will cost them a lot more money than using your one service. So that's probably the simplest example is that their alternative to using your service requires them to use three other services that end up being more time and hassle for them. By knowing what their BATNA is, or what their alternative is, you have a stronger negotiating position. You don't have to give up as much. And also you can remind them Yes, for example, let's say $5,000 a year sounds like a lot of money. But if you were to not use this service, and use x, y and z instead you would be paying $15,000 a year. So you have actually just created a net positive for them of $10,000 and you haven't moved on your price at all. Another thing that is really important in a negotiation and part of not being mean another way to put it, it's actually a book that Alex recommended last week that really piqued my interest called Just Listen. And he had mentioned how this is a book used by hostage hostage negotiators. And that really got me interested because they are some of the best negotiators out there. And one of the concepts of it is you just listen for what is important to the other side. So for example, in your salary example, what may be important to you is the number but there may be other benefits that are really important to you, that are ancillary to the salary itself, that actually aren't very difficult for the employer to give you. So for example, let's say that you're negotiating on a salary of $100,000, and they're only willing to give you $95K. You can look at the other pieces in the negotiation and see if you can play things off of each other. So, for example, you could say, well, I'm willing to take $97K If you give me 21 days of vacation rather than 14. For the HR person, it's much easier for them to give you 21 days of, of vacation rather than 14 because they're not taking a cash hit from that, right, like understanding what their alternative is and what they are being measured by. Which in this case, it might be keeping salaries down, they can give you other fringe benefits that help sweeten that deal for you that that bridge that maybe more than $5,000 to you. So whether that's vacation time, or I was almost going to say commute benefits but that's not really a thing here right? Or, or other things that aren't cash, right? Because that's what they're being measured by, then you can increase the value of the deal to you, even though it's not increasing the actual cash value from the other party side. Colleen Schnettler That makes sense. So let's take your example of an enterprise customer comes to you and says, Hey, we'd love your service, but I see you're charging $10,000 a month and we only want to pay seven. Like, what's the first thing you do? Do you when you're faced with that kind of negotiation?Michele Hansen So in that scenario, I would first of all say they're taking way too big of a cut and I, I wouldn't even entertain going that far. There are a lot of purchasing managers though and managers in big organizations that may be measured based on how big of a discount they get. So whether that's like 5% or 10%, I believe a lot of them are expected to get a 10% discount on services. And what you can do in that scenario is trade the discount for the number of years. So to you, especially as a small company, multi-year deals are really valuable, because then you know that revenue is going to be there. Especially if you're a small company, and you're just building your company and you want to know that you can make investments and make decisions and the revenue will be there. So if they came to me with that, I, you know, I would say, you know, really the lowest we're willing to go is $9,000 for a three year minimum commitment deal, you know, and then you can negotiate back and forth and whether that's paid up front entirely, or they get to pay every year, I might do less of a discount for that. And it's pretty common in SaaS to buy, you know, a three year subscription and paid all of it up front. Like in the real enterprise, world of enterprise non enterprise. Yeah. So you can trade a discount in exchange for length, the length of contract. And there can be there's always other things you're negotiating on an enterprise scenario. So for example, the invoicing length, whether it's 30 days, 45 days, 60 days, or whether you get to use their logo on your website, you maybe you can give them a discount in exchange for that. But in a negotiation, you always want to figure out okay, what are the, you know, five, 6, 10, 20 different issues here that we're negotiating on? It's not just the prices, the price, it's the length of the contract, It's, I mean, details down to what is our choice of law, what is the jurisdiction, or is it where we are established or is it Delaware or New York or wherever that other company is established? This is like something that every enterprise wants to change in a contract. They always want choice of a law to be wherever they are incorporated. But all of those other things and then thinking about how you can play those off one another and try to understand what are the what is really important to them at the end of the day, and how can you put something together that gets what you want out of it and also helps them hit their most important thing. But going back to that, that book, how you figure that out, is you just listen to them. And one of the negotiations in my class that I learned the most from was actually probably the most scared I have ever been in an academic environment. We did all these negotiation activities from buying a used car to being a zoo negotiating for pandas. And, and one of them was a group of people in a neighborhood negotiating with a construction company about a new development going up at the end of their neighborhood. So you basically have a bunch of angry angry townspeople with pitchforks against these two corporate representatives. In my case, I got to be the corporate representative, and there was only one in my group. And then there was all the people who had all of their different concerns. And this was basically my nightmare, like, just going into this scenario, and just gonna have a bunch of people yell at me. I was really freaking out about it. And I did all that research, I was looking at all the different issues. The corporate representative is really not in a good position in that negotiation. But the one thing I had on my side was that it was time limited. And so I think it was we were limited to about 20 to 30 minutes of negotiation in front and it was actually in front of the rest of the class too. They couldn't participate or no actually, I think they could heckle us. Yeah, it was. It was a fun one. What was in front of everybody else. And so I realized I was like, okay, all of these people are upset. If I just make them all talk and I avoid saying anything, I don't have to give up anything. So if there was six people, first person would air their grievances. And then I would say, it sounds like, what you're saying is this and then "So and so I haven't heard from you in a while. What do you think about that? I thought you might have had some concerns about that." And I just kept doing that and saying, "I think this other person had concerns about this, but they were slightly different." Would you be able to tell me more about that? And so we got to the end of it. And we're doing a debrief in front of everyone else. And the people who are who are the townspeople negotiation, really struck me they're saying things like, "Oh, you know, I felt like we really got a good deal here." Like, you know, we like we really like we're heard and you know, all of these things, and then somebody else goes, wait a minute, she didn't actually give up anything. We just talked the entire time. And so I was using it in that sense, sort of, you know, sort of to their disadvantage, but just genuinely listening to people is so, so powerful. And that's how you understand, okay, of all of these different issues in this negotiation, which ones are the most important to them? What are their alternatives? Like how strong is their negotiating position, right? If they don't have any alternatives, their position is quite weak, and you can push them harder on those issues. And then understanding what your own perspective is on it. And so that book that Alex recommended is such a good introduction to this. But if anyone just Googles BATNA, you'll get like tons and tons of stuff on negotiation. It's even something I would suggest finding like an online workshop for or something because I really learned so much from that. And it's, it's one of the big things I got out of my MBA was that confidence going into negotiations that I know it's important to us. I know what I can't back down on. But I also know where I can give them space.Colleen Schnettler That's awesome. Yeah, I'm definitely gonna read that book. By the way, I have already ordered it since we talked to Alex.Michele Hansen It's so good. Like I, I just started it yesterday and I'm already 15% of the way through and recommending it to people. And it's, it sounds like, you know, it's some business books can be really quite a slog. This one definitely isn't. I mean, you know, it has examples from hostage negotiators and other scenarios that really give you a tangible understanding of how this can be applied.Colleen Schnettler Whatever negotiation you're thinking of that made you want to discuss this topic, how did that end up going?Michele Hansen I would say that all of our negotiations have gone well. Some of them are definitely harder than others. You know, like I was saying in that scenario with the townspeople, there have been quite a few scenarios when it has been just little old me versus a team of corporate lawyers, that's pretty much how all of our negotiations are. But because I've done that training and that research into negotiations, and I've understand how it applies to our business, I feel confident in those scenarios. And the thing about our knowing my BATNA is that there are negotiations that we've walked away from. And those have been those have been very difficult, but we knew we would be able to make up the revenue elsewhere. And what they were asking us to concede were things that we just could not concede, you know, I can concede, choice of jurisdiction, but there are, there are other things that we just simply can't and if a customer or potential customer asks us to concede those then we have to walk. But we have a good BATNA in most scenarios and It's just a matter of sticking by that and knowing what makes us unique.Colleen Schnettler Great. Michele HansenSo what's on your mind?Colleen Schnettler So, update from last week, I'm just trucking along trying to get my add on configure to add it to the Heroku marketplace. I got some help today with a technical problem that's really been given me a hard time. So that felt really good. Because right after we had our podcast last week, when I was like, I'm done, I was like, Oh, no, I have to have this one more thing. Michele Hansen Oh, no. Scope Colleen Schnettler I know. Michele Hansen Scope creep!Colleen Schnettler Oh my gosh. So I wrapped it up today actually, like I am done with a feature set for now. I'm going to put it in the Heroku marketplace. I have looked into the details. So the way it works is, you put it in a marketplace you get 10 of your friends. Are people you know, to test it out with you, then once you've done that you have to request to be moved to beta status. And beta status is 100 users. A hundred! So you've got to get 100. I know that's a lot of people, right? That's a lot of users. So you got to get 100 users in the beta status to use it. And then after that, you can request to go to general availability. You can't start charging for it until you get to general availability. So this is, you know, just something interesting as I get along here. And I think once I get a couple people using it, I'll be able to get some more feedback. But also, I looked up the AWS free tiers, and the AWS free tier is five gigs of storage. So with 100 users, that's 50 MG per user. So if they each have, you know, 10 users, and the each of those Users upload a 5 MG file, like I'm already going to bust through my storage. So practically speaking, I don't really know how that's all gonna work. But you have to actually speak to someone from Heroku. I think before you go from alpha to beta, so I guess I'll just ask them like, Am I just supposed to eat that cost? I guess I just eat the cost for a while. I don't know, if it's like you get 100 users and right away, you can go or I'm still working out those details. Michele Hansen You know what that sounds like to me? a negotiation.Colleen Schnettler Haha, yes. Excellent. Excellent. I'm going to read this book then. And I'll be ready.Michele Hansen I imagine they must have some leeway on that, especially if it's a scenario where you are incurring a genuine cost for all of those users. I have to imagine that they would be willing to work with you on that.Colleen Schnettler I think so too. I mean, I just don't know how you can not. It's there's got to be a way to do that.Michele Hansen Don't be afraid to ask.Colleen Schnettler Yeah, there you go. And that and that's an excellent point. And so I'm not too worried about that yet, but I did want to like kind of look that up and it seems like something kind of has to happen there to make that feasible. It's interesting because now I am trying to do well now as in like, I just started thinking about it, but I at least need like a basic marketing site. And I tell you what, this is something as a primarily back end developer, like making a marketing site makes me want to just hide under the covers, like logos and colors and I'm like, mah! So yeah, so I got to do that. Michele Hansen How much do you get from Heroku marketplace? Like I cuz I've seen other products on it and like, do you customize the whole thing or do you get sort of a template that you're working with?Colleen Schnettler Yeah, you have a template you're working with. I was also going to do... so the way I've written this, I was also going to just kind of have the front page like kind of like a splash page or whatever you guys call it, like, you know, a basic marketing page that would then link you back to the Heroku elements marketplace, I don't have to have that. Because Heroku does provide -- like you can do this whole thing without any kind of webpage outside of your app your application. So I guess I don't have to have one now that you say that. I could skip that for now. It's not like, I don't know, what do you think?Michele Hansen Well, if you only need 10 users for the initial phase, it might even be good to not have a huge presence for it. Because, as you said, you're going to get feedback from the first 10 people using it and that will really help you guide what kind of instructional content you need to have on that page. And if they're giving you a template, that's reducing decisions for you. And that could make it easier for you to launch.Colleen Schnettler Yeah, you're absolutely right. And you're right that this is great. See, this is why this is great. This conversation. I don't need to spend time on that. Right now. Right now I need to focus on getting good documentation for people who are going to use it and getting it available in the marketplace. Because you're right. I mean, there's no real point like to that page. So I'll start with my 10 users and see, you know, see where it goes from there, I guess. Try to get feedback and see if it's even something people want to use. Michele Hansen Do you have your 10 users lined up? Colleen Schnettler No, I know, I can think of maybe five people I know who use Heroku for personal projects. I'm hoping between like the people I know through my network of rails developers, because it's a pretty popular platform. That I can get 10 people, but no, I can think of maybe four or five. Right now. Michele Hansen Do you think those people who said use the Heroku platform? I'm curious, maybe they're connected to communities as well, if they would be able to recruit people -- sort of pyramid scheme style, it's not. Um, you know if each of them can bring in one more person if they're if they're willing to retweet it or send something out to a listserv or something like that, that could help you get to that first inflectioon point.Colleen Schnettler Yeah, I definitely think so. The only thing I'm kind of concerned again, about and, again, maybe it's just too early to be concerned about this. But let's say like, you sign up with Heroku because it's free to sign up. You could install my add on without ever installing it, and I would get credit for you installing it, which is cool, but I actually want people to use it. So it'd be even better if I got people who actually used it. I don't know if I need to worry about that now, or what your thoughts are on that.Michele Hansen I think that's gonna happen with any platform, right? Like, I think, I think Zapier is kind of like that. I remember when we were launching our zap a couple of years ago that like, there was all these people who installed it, but they didn't actually install it and...Colleen Schnettler Exactly.Michele Hansen And we never really got a lot of feedback on it at the time. Um, I mean, you know, people buy things and don't use them all the time, or they sign up for something, even if it's free and don't use it. But it at this point, if you can get, you know, five solid users of it, who are giving you feedback. We're giving you ideas for documentation, for tutorials, for use cases, that's really valuable and, you know, maybe you limp over the finish line and Not all of those 10 users are actually active users. Um, but I think that's okay. Um, I think it would be more of a concern if you can't even get to 10 people.Colleen Schnettler Yeah. That's telling it of itself, right. Yeah. Okay, cool. Yeah. So based on this discussion, next week, I'm going to focus on getting it in the Heroku App Store. And then just talking to people in my network to see if I can get people to start trying it out. Michele Hansen Have you started writing the documentation?Colleen Schnettler So what I did is, I'm using it. Well, I'm almost using it. I'm using it on a site I own right now. So I've kind of been taking notes as I integrated it with this existing site. So I have not comprehensive documentation, but I think I can pretty quickly put enough together based on these notes I've been taking to do basic documentation, but this is something I think would be really cool. Like a really cool way to do it would be like a video, you know of how to integrate it into your site. And like I should have a sample -- what I also want to do is have a sample project on GitHub, which is something I've got a got to make. So I was going to do that so people could see really quickly how to integrate it in their site. Things like that. Michele Hansen Do some basic text documentation to launch right with all of this, pull back the layers, launch with the absolute minimum, you would need. I mean, I think we just started doing tutorial videos like six months or a year ago. Colleen Schnettler Oh, okay.Michele Hansen Like there's so great to have. But I wouldn't say that you need to throw that hurdle in front of yourself as something that you need to do before you launch. You need to be removing hurdles at this point. And so making a video that shows how to do it is awesome, but that can be done after it's launched. Having an example project on GitHub. That's a really cool idea. That can be done after it's launched.Colleen Schnettler Okay. Michele Hansen Simplify.Colleen Schnettler Yeah. So so here's something I want to talk to you about, too, because I, you know, we've had a lot of conversations about how my own perfectionism and scope creep are getting in the way of me launching a product, right? But I don't know if I ever told you in like, 2011 maybe I put an app in the iOS App Store. It was terrible. And so um, I think I think I'm a little gun shy about that because that was something like I launched too soon. And when you first launch something, you get some like excitement because you tell people about it on Twitter and, and you know, you tell people in your network about and they check it out. And if it's terrible, then they don't check it out once you fix it the second time. So so I'm always stuck in this conflict of like, Is it good enough? Is it not?Michele Hansen So, a couple of things come to mind there. The first is there's always going to be somebody who's mean. Like always, there's always gonna be somebody who's like, "Oh, this is dumb, like, you could just do this yourself by doing these 10 steps that are totally completely obvious to everybody." Not, which is like, I mean, if you launch something, and that isn't the top comment on Hacker News. I've never seen that. I mean, you know, the famous example is somebody saying that about Dropbox and about, you know, how all these you can do all this gymnastics with Linux and stuff to do it. I mean, we got that comment, right and about "Oh, is terrible. They don't have international support." And you know, like, there's always gonna be somebody who finds a problem with it. Right. And, you know, we also had an app that we got it, we got an article on DCist, which is like sort of the big, you know, DC local blog, and we totally screwed something up. And it never really recovered from it. We still launched stuff, we launched Geocodio after that you know after that. And it's fine. You just got to get it out there and you know, people who are going to be mean and rag on other people's projects, like they have bigger problems than just your app. There's one person or two people who are rude, but the vast majority of people are being super positive and supportive. And just because there's one person saying something mean, it doesn't mean that that negates all of that positive feedback that you got, like that one mean person does not deserve to live in your head, right? Like if they were a friend of yours, you would not be friends with them for very long if they said mean things to you anymore. So why do we give this attention to Hacker News commenters or people on Twitter or whatever that may be? You just screw em, like, you know, haters gonna hate, right? Like just read it out there and people don't like it like They're not your market, whatever they can do their other process. They have something else that works for them.Colleen Schnettler Yeah.Michele Hansen Don't let them keep you down.Colleen Schnettler That's That's great advice. Thank you so much for your support and encouragement. I appreciate it.Michele Hansen Always there for you, Colleen.Colleen Schnettler All right. Well, that's gonna wrap us up today. Thank you so much for joining us. Tune in next week to hear if Colleen has finally launched her product or not. And to hear what's going on with Michele. We are on Twitter at @softwaresocpod and we would love to hear from you.Michele Hansen Also, if you wouldn't mind leaving us a review, we would absolutely love that. Thanks so much.