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Andy Brice
Successful Software

Doug Nebeker ("Doug")

Jonathan Matthews
Creator of DeepTrawl, CloudTrawl, and LeapDoc

Nicholas Hebb
BreezeTree Software

Bob Walsh
host, Startup Success Podcast author of The Web Startup Success Guide and Micro-ISV: From Vision To Reality

Patrick McKenzie
Bingo Card Creator

Fail stories

Hello friends,

Everybody talks about success stories, many hide specific details in order to not to give up a niche, afraid of competitors, etc...

But in this topic, it would be interesting to hear *fail* stories - and I guess giving up a bit more details about projects, "niche", etc.. wouldn't be an issue.

Vague fail stories are as well welcome, if you're too shy :)

Personally, I'd like to hear stories about desktop/shareware projects, but feel free to post about other ones.

Thank you!
exim Send private email
Wednesday, October 16, 2013
Here is my fail story..

Before I started Grumo Media ( http://grumomedia.com ) in 2010 I spent 1.5 years working alone at home pouring my heart and soul into building an online project managing and invoice tool called PointKit ( http://pointkit.com ).

Unfortunately PointKit never saw the light of day because I ran out of time, money, patience, and energy before I could even do an official launch. In other words, PointKit was a failure, a typical first time entrepreneur's failure.

Failing is hard, demoralizing, painful, and embarrassing, but in many occasions it can also be the most effective way of learning important lessons that will prevent you from making the same mistakes in the future.

Now I'd like to share some of the lessons I learned from my first startup failure with the hope I can help future entrepreneurs avoid similar mistakes:

Lesson 1: Don't underestimate the effort that goes into building a complete product

Why did I decide to build PointKit? Before starting PointKit I had already developed and sold a custom project management tool for a team of Canadian Cisco engineers. The tool worked so well that one of the engineers suggested I should build a business around it. At that time I was freelancing and considering starting my own company so the idea of building a SAAS (Software As A Service) startup seem very appealing.

At that time I naively thought all I had to do was put a price on my project management tool and bingo! I could start making zillions, retire on Mars and have martian piña coladas with my buddy Elon Musk.

Boom! BIG MISTAKE numero uno. A tool is not a product. A product is not just a tool.
Taking a tool and making it into a real product (productizing it) takes a lot of work, most of which has nothing to do with knowing how to program.

There is a long list of things you need to be able to do to create a whole product and many of those things will be beyond your core skills. This doesn't mean you should not plough ahead if you truly believe in your product but it is important to understand what lies in the future.

For instance, you'll have to come up with an identity for your product. This means coming up with a name for your product for which Internet domain is available and not already copyrighted. This can take days if not weeks.
You'll also need to build a nice-looking website, pick a template, come up with a nice logo, and choose a corporate colour palette.
Assuming you are like me when I started, you'll have absolute no money to hire other people to help you, so you'll have to design your own logo, build your own website, well.. do everything yourself.

If you have no marketing dollars you will need to have a marketing strategy that involves no ads or PR agencies.
Basically you'll opt for inbound marketing which means now you have to become a blogger and learn how to write good content often so you get links back to your site and rank higher on Google.
Then open accounts in all the social media sites you can. Post links to your blog together with good content so you can start building your network of loyal followers.

Of course, you need to build your own payment processing system. A PayPal button will only take you so far and people will not trust you or take you very seriously until you have a good payment system in place.
That is only the beginning because you need to test it and make sure it works.
You'll set up a sandbox testing system and learn the PayPal payment API so you can accept credit cards on your site.
But for that your site needs to have SSL encryption and be PCI compliant. Oh no!

Now you need to make sure the payment system integrates well with your application, so when someone pays an account is created automatically, the new user gets a welcome message and his/her credentials.

Slowly but surely your days start getting longer and longer. Working 14 hours a day seems normal, you don't know what day of the week it is anymore and always go to sleep past 2 am.

You thought you could start charging money in 3 months but 4 months into your startup adventure you are still trying to fight some ugly bugs in your chorizo code, have not figured out how to set up your own dedicated server, and are still struggling to figure out all this inbound marketing crap that has nothing to do with coding your awesome industry disrupting easy-to-use productivity app.

I hope you see what I'm getting at here. Building a real product takes way more than meets the eye.
Is there a faster way to build a product? Not really. Eventually you'll need to checkmark off all of the above and much more to build and release a fully working real product. However, you can save a lot of time and headaches if you read Lesson 2.

Lesson 2: Validate your idea as early as possible

Before you spend a million hours trying to build a perfect product nobody wants, you need to figure out as soon as possible precisely that, does anyone even care about my product?
You see, my first mistake was to think my product had to be perfect before I could launch it into the world.
I thought it had to be better than everything out there right from the get go or it would not stand a chance.

There are two big problems with that philosophy. One, there is no way to build a perfect product on the first try so aiming for perfection on your first release literally means you'll never release the product.
Second, the longer it takes to release your product the more likely it is to suck!
But Why? Because the only product validation that matters comes from real users, ideally paying users.
All the time you spend coding and scheming about world domination alone over your keyboard is worthless without involving the most important part of your startup equation, your potential customers.

When you have no customers you are working in a vacuum. If you like to daydream like me living in a vacuum feels very nice and cozy. No one can reject your baby, you are the only one you need to satisfy. But all you are doing is floating inside a bubble of self-fulfilling BS. You can only do that for so long before, like me, you run out of money and the bubble explodes when you realize that no one is willing to pay for your world changing creation.

How do you avoid this? Very simple. Follow the lean startup mantra. Release early, release often.
Or release early and iterate often based on real world feedback. I know it is scary to deliver a half baked baby into the word, but unless you have absolute confidence in your skills and product (or have a zillion dollar team of super engineers like Apple), the fastest path to product validation is jumping out of the vacuum as soon as possible.

Use common sense, don't release when you have only produced a couple lines of buggy code. Make sure you release an MVP (Minimum Viable Product) that although it may do very little it does it well.

Sometimes you don't even need to build a product to validate it. Many successful startups have started just by asking potential clients what would they be willing to pay for if it made their life easier.
Ideally before you start working away on your startup you have already found a couple of potential clients willing to pay for your solution once it is built.

Lesson 3: You cannot take over the world alone

Working alone sucks a lot, but for the social inept like myself working alone feels safe.
No need to interact with other scary human beings and having to deal with their opinions and odours.

The earlier you get out of your shell the better. It's ok to spend sometime working alone in a dark room surrounded by your loyal and harmless childhood stuffed teddy bears, but eventually you need to man up and confront the world of real live flesh homo sapiens.

Sapiens means wise. Human wisdom is the most valuable resource when building anything. Even if you decide not to have a co-founder or are unable to find one during your early development stages, real people and their wisdom will be what you'll need the most in order to build something people want. In the end all products are built by people for people.
This means that for any startup to be successful, people need to be accounted for from the very beginning.

Don't use the excuse of having no money to avoid getting help. There are many wonderful, smart people willing to help you succeed by giving you advice, checking out your app, mentoring you and sharing their knowledge.

Join a startup meet-up, attend startup events. Pitch your idea to everyone you meet. Instead of avoiding negative feedback, seek negative feedback (top tip by Elon Musk).

You'll be surprised how easy it is to reach some of the top entrepreneurs. Share, comment, re-tweet their articles. Get under their skin. Offer and volunteer your skills to gain their trust. Who knows, they may even invest in you down the road. Now thanks to services like Clarity.fm you can get on a call with many of your startup idols. Seek people and above all things, don't work alone for too long or you'll start looking like this.

Lesson 4: Only work on something you are truly passionate about

Even if something seems like a good idea, it doesn't mean you should do it.
I started PointKit because at the time it made sense to pursue that idea. I did not have any better ideas and heck, I already had made some money building the basic app.
At that time there was nothing integrating task managing, time tracking, and invoicing all in one package, so the competitive coast appeared clear of 500 pound Spaniard eating gorillas.
I thought if I worked hard enough success was just around the corner.

And hard I worked for 18 long dark and painful months. I put my head down and wrote thousands of PHP, HTML, CSS, and Javascript lines of code. That success corner wasn't as close as I thought. In fact I never got around the corner but that doesn't mean that there was no potential success awaiting my arrival (I just didn't make it there).

Paul Graham says that success comes most to those entrepreneurs that are relentlessly resourceful. You know what, I truly believed myself to be as relentlessly resourceful as any human could strive to be. There is a fundamental caveat with that belief though.

On the last hour, when you are down to your last wits, have no money, are physically and mentally exhausted there is only one thing that can keep you going. You know it, it is called passion.

Turns out I was more passionate about the idea of building a startup than about what the startup was about. Wrong!
You know, the day I quit PointKit was the day I admitted to myself that I did not really give a damn about project managing software or time tracking applications. Yes, it would have been nice to build a cool tool and say it was all mine. But "being nice to have" won't cut it when you are starving and facing imminent bankruptcy.

This has been said a million times by a million successful entrepreneurs. Follow your passion, work only on something you truly care about, or sooner or later you'll hate your life. (I wrote about how to find your passion in this article.)

I think PointKit could have been very successful if I had had a genuine passion for the product and what it could do to help people. But then I asked myself, what if PointKit is successful? What if I have a million users that love the app?
Success seems nice at first glance when you think of wealth and fame. But success also means commitment.
If PointKit had succeeded that would have not marked the end of my efforts. Now I would be chained to improving the app, serving my customers, my life would be PointKit day and night. Success would mean I would have to devote my life to something I am not passionate about.

In the end I'm very happy I stopped working on PointKit. Only a few weeks later I started Grumo Media and was able to validate a fun and creative business without a single line of code in less than two months.
Grumo Media has been profitable since day one and now we've produced hundreds of fun demo videos for startups all around the world. Much of this success comes out of the lessons learned from the failure of my first startup.

There you go! I hope you never make the same mistakes I did and that these lessons serve you well on your exciting entrepreneurial journey.

PS: I wrote this article because one of my followers, Patricio Bustamante from Chile, asked me if I could share any lessons from my failure launching PointKit to help him with a class assignment. The actual answer is in a 15 min video recorded in Spanish and can be watched ( http://grumomedia.com/4-lecciones-de-mi-primer-fracaso-empresarial/ ).

Original post is at: http://grumomedia.com/how-to-avoid-startup-failure/
Michael Zenbach Send private email
Wednesday, October 16, 2013
My failure as a TL;DR:  Taking glacially too long to code the program.

Started off with zero programming experience.  Wasted the better part of a year just playing with the idea in my head and mocking up things with PowerPoint.  Then taught myself programming, worked very sporadically in my off time, kept adding features, wrestled with limitations in 3rd party libraries, had human representations of time as one of the main bugbears of the programming, mysterious database errors, Unicode, etc.  Rinse and repeat for 7 years.  Still not done, and at this point I'd be surprised if it ever is.  I guess MVP is only applicable to programs that don't degrade catastrophically (which is to say that most of the bugs I've dealt with are show-stoppers for the user, and so I just can't ignore them and do the oft-mentioned "embarrassed first version").
Racky Send private email
Wednesday, October 16, 2013
>  I guess MVP is only applicable to programs that don't degrade catastrophically

If the bug would affect 100% of the users and stop them giving any feedback then yes, you'll need to fix it for an MVP.

If it only affects x% you still have an MVP. You can refund those people and get your valuable feedback sooner.

The value of x will vary with the product / bug in question.
Jonathan Matthews Send private email
Wednesday, October 16, 2013
The real MVP question would be were all those features really necessary? A lot of feature that you say "can't ship without" really are things that in reality it turns out you can.

>>  I guess MVP is only applicable to programs that don't degrade catastrophically

If the bug would affect 100% of the users and stop them giving any feedback then yes, you'll need to fix it for an MVP.

If it only affects x% you still have an MVP. You can refund those people and get your valuable feedback sooner.

The value of x will vary with the product / bug in question.
Foobar Send private email
Wednesday, October 16, 2013
Yes, that's definitely the first question.
Jonathan Matthews Send private email
Wednesday, October 16, 2013
"You can refund those people and get your valuable feedback sooner."

This is how a "market for lemons" is created. Dump shit on the market, and soon customers won't pay more than they can afford to lose on anything. You see these dynamics in the industry, and it's why customers now won't pay more than 99 cents for most software.

Most customers don't return bad stuff, so intentionally releasing bad stuff and making money off those who don't return it is still fraud.

I'd like to see liability law for software. If you intentionally release crapware on the market, you can get your ass sued into oblivion.
Scott Send private email
Wednesday, October 16, 2013
Some great insights by Michael Zenbach.

Some more failure stories on my blog here:
Andy Brice Send private email
Wednesday, October 16, 2013
So practical advice for Racky.

Don't release broken crapware.

What you do is remove all the broken functions. You release a program with less functionality.

I do this with every release. New features are put under the control of variables that can switch them on and off. If a new feature just isn't working at the time a release is ready, then it is switched off.

This mechanism of live feature control also allows for the pro, standard and lite editions to be made not only from the same codebase but be a single download.
Scott Send private email
Wednesday, October 16, 2013
Thanks, folks, for the response on MVP. 

It's sometimes hard to gauge what % of users would be affected by certain bugs, since I don't have any user feedback yet to know which features are going to be popular.  But I see the basic idea, thanks.

But I also see Scott's point:  remove all bugs, at the cost of the existence of features.  I'm now at a point where doing that is tough, since the bugs are wrapped like mistletoe around the oaks of primary features, without which the app, though not "crapware" will turn into "lameware" (in the sense of, "It works, but it's lame/boring/blah to use").  It's a work in progress.  But I will do what I can.
Racky Send private email
Wednesday, October 16, 2013
I've released 5 products since 2003.  2 have been successful, 2 have done OK, and 1 has failed. 

As far as I am concerned the 2 "ok's" have failed for exactly the same reason.  Lack of resources (ie there is only one of me).  They need a full time person working on product improvement, content development and customer relations.  I'd love to have the time to do that but my two "successes" have consistently shown a better ROI on the time I spend on them.  There's nothing fundamentally wrong with the products themselves.  In fact I re-wrote one of them from the ground up last year to improve the look of the product, solve several technology issues and to (vastly) improve the first run experience and the conversion rate basically tripled in a month.  However with some Google algorithm changes in 2012 the website they are on lost a large percentage of it's traffic (about 80%) and they no longer get enough traffic for them to evey generate significant income.  They used to be a fairly reliable source of income (about $4000 combined per month).  After the loss of traffic late last year they've been in the $1000-$2000 a month range.  If I'd had time in 2009-2011 to generate more content on the website I suspect Google wouldn't have hit them as hard as it did.

The total failure was essentially a re-branded version of one of my other products targeted at a different segment / set of keywords.  So the actual development effort was fairly minor (several weeks as opposed to several months).  It turns out the segment and KW's it was targeted at were primarily being generated in third world countries (mainly India) and despite some decent traffic to the website the product just never, ever, ever sold.  Very poor market research on my behalf.
Mark Nemtsas Send private email
Wednesday, October 16, 2013
You can ship with some known bugs, they just can't be important ones that would cause trouble. So let's say some of the layout has mismatched colors, or isn't pixel aligned. Or maybe it's a word processor that doesn't import 100% of Word files, but you can easily toss in an alert message that says "could not import".

As the designer with experience using the program you'll have trained yourself into a certain way of working with the program that tends to avoid buggy conditions, and you won't even be aware of it. This is why it's so critical to get rid of the things you do know about.

When I find a data corruption or destruction bug, I'll shut down all web sales until I fix it, and work 24 hrs a day until I do and issue an emergency fix. This has only happened a couple of times, but such bugs are extremely troublesome and I consider it criminally irresponsible to be shipping if aware of bugs that can destroy client's data.

There are things less than data destruction which are critical to remove as well.

Recently logged into Yahoo Mail, and it was a big WTF. How did anyone sign off on that? Stuff actually doesn't work in addition to the interface being terrible. People are reporting lost email. Lost email. That's a serious issue.
Scott Send private email
Wednesday, October 16, 2013
My reason for my last product failing: believing what others told me about my app.  You'll get tonnes of advice from others who say "don't do that" or "do it like this" and half the time it's bullsh*t.  Don't always believe them.  Validate their points first.  Research.  Find out why they're saying what they're saying.  Some just don't want you to succeed, amazingly.

My last product will be headed for a relaunch next year, but this time designed precisely the way I originally envisioned it.  It failed when I strayed from my original vision and listened to others and did it their way, so I may as well see how it would've went had I stayed true to myself.  I hope to be pleasantly surprised.
PSB136 Send private email
Thursday, October 17, 2013
About 6 years ago, I had a site gotfantasyfootball.com.
It was an online Fantasy Football Drafting tool. I wanted to compete with the desktop versions that updated there projections once in the NFL preseason.

I think I had like 2 sales at 15 bucks a piece. I stopped my mISV after my daughter was born.

So, what went wrong? The market was too saturated! It's only gotten work. I think I read somewhere that the leading mobile fantasy football drafting tool had 6000 paying users at .99 cents per the app. Geez! Not much ROI.

Also, Marketing. Sure, other fantasy football sites would let me put a link in exchange for me putting  a link. But, I really needed to put up some cash.

I'm looking into another mISV endeavor. The reality is I will only do it if I can get a site launched quickly (< 80 hours) and cheaply - I'm talking max 30 bucks/month.
Patrick From An IBank Send private email
Thursday, October 17, 2013
I  have fail stories galore. For the best ones, you'll have to buy me a beer.

Most recently: I almost fired a support person because I kept getting horrible customer feedback.  "So and So didn't reply back about my problem,  Ignoring me, etc, etc." I would log into our ticket system and I see that the employee has been responding to people, very politely and quickly. I couldn't figure out what the hell was going on.

Finally I realized: 4 months earlier we moved email servers, and the email address that we used to reply to customers through the ticket system was never updated.  For 4 months, I've my employee has been working but no customers have been getting his replies.  He's been working hard to make people happy, but instead everyone (understandably) through they were being ignored. All of the coding fixes we made to address specific problems, none of them had been delivered. All because of a stupid mistake with an email address. It has cost me tens of thousands of dollars this year in lost sales; I know it for a fact.

The problems I fear the most are not the ones I know about. It's the ones I don't know about.

Lesson:  quickly investigate small problems because they could be the tip of an iceberg.
Darren Send private email
Friday, October 18, 2013

[[]?    <-- I think you need one!

Reluctantlyregistered Send private email
Friday, October 18, 2013
I have made a few good products, and users have written that they like it. But all products are died for only one reason. I was not able to deliver them to the users. Incredibly hard to do it. I think now that it is the MOST significant and important part of the work. It is necessary to promote the program website, else your product no one will find. And since Google introduced now few bad and strict filters, now there is no way to let users find your product, so all my work was useless, my programs exists, but no one know about it.
PS: sorry for my English.
Don Pedro Send private email
Saturday, October 19, 2013
Some users can find them, but very few of users, because I do not understand how to promote the site, I only used Robosoft all years.
Don Pedro Send private email
Saturday, October 19, 2013
This thread has been very informative and helpful to read.  Some of these fails sound like major nightmares -- but I am really impressed that it seems you've gone on to find success with other software.  The one where your outgoing email was going nowhere for months, um, OH. MY. GOD. how awful.  I hope things bounced back.

I am working toward launching my software for online sales in a few months and  I really appreciate the honesty and generosity of information I've gotten in this thread and elsewhere on this forum and it has helped me tremendously.  Well, this thread scared me too!

One thought that occurred to me when reading Michael Zenbach's article is how lucky I am to be doing this at a time when so much has been done by others that I can benefit from.  Someone else is developing my website.  We paid just $300 for an awesome logo from 99designs.com, there is shopping cart and licensing software already built that I can essentially "lease" until I know if my product is profitable enough to warrant paying someone else a few thousand dollars to develop for me.  If I can't figure something out, worst case scenario, I can find help on a site like elance.

I was also really struck by Jonathon Matthews's comment:
"If it only affects x% you still have an MVP. You can refund those people and get your valuable feedback sooner."

It's true that you don't want to release a piece of junk that enrages all who buy it.  But I also think that being afraid something will go wrong has really held me back in the past. 

If a few people have a problem, they can be refunded.  The product can be improved.  The world won't end.  I often see people who are more confident and less worried that a % of clients will be unhappy if their product/service is not perfect getting ahead of those with higher quality products/services just because they are willing to put it out there and see what happens.

Also rightly or wrongly, people have been somewhat conditioned to expect and accept errors in software.  I have been selling my software on a small scale to individuals for some time and they'll get errors sometimes and not even tell me 'cause they just think that's normal or that they weren't supposed to click there....
Emily Jones Send private email
Sunday, October 20, 2013
>If a few people have a problem, they can be refunded.  The product can be improved.  The world won't end.

Indeed. The biggest problem small software vendors face is indifference. You release a product that nobody cares about or wants. It happens all the time. The best way to avoid that is to release ASAP. And if someone doesn't like it - at least they weren't totally indifferent.
Andy Brice Send private email
Monday, October 21, 2013

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