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Software Businesses

Make More Mistakes 262

Posted by michael from the easy-enough dept.
prostoalex writes "Eric Sink from SourceGear, well-known in the open-source world for AbiWord Suite, shares his thoughts on starting and running a software business. One of the keys to a successful business, as Thomas J. Watson once said, was to double the rate of failures. Eric Sink tells the story of what mistakes he personally made, what could be avoided, and what's important for geeks to know when starting a software company."
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Make More Mistakes More

Make More Mistakes

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  • Hard work (Score:5, Insightful)

    by BWJones ( 18351 ) on Saturday December 27, 2003 @01:06PM (#7817791) Homepage Journal
    One of the keys to a successful business, as Thomas J. Watson once said, was to double the rate of failures.

    One of the other keys I have found to a successful business is to work your ass off. This could certainly be seen as doubling failure rates. Interestingly though in the software business many companies appear to be adopting Microsofts model by releasing all of their failures to the public and letting the public sort them out. Other companies (like Apple) certainly have their share of failed products, but they do not foist them on the public. Rather they work them until they are good, or they do not release them. Also, often I have seen in my consulting, businesses that start out strong through insight, hard work and luck get run into obscurity through the next round of managers who take over the company. (it also happens when parents turn their businesses over to their kids who do not have nearly the same work ethic.

    • Re:Hard work (Score:4, Insightful)

      by AxelTorvalds ( 544851 ) on Saturday December 27, 2003 @01:24PM (#7817890)
      Of course. If you increase failure rate with stupidity then you'll never win. I think Gordon Moore said it a little differently. "If you aren't failing then you aren't trying hard enough."

      The original point is good, I still think more companies are blowing up because they are doing foolish things. Starting a company is very hard work and there is a lot of it. You either have to be a lot smarter than the competition or work a lot harder, no way around that and you're probably not that much smarter. The startup I'm with has busted our asses but it's looking positive, during the roughest parts I hated it but now looking back, it's the only way we've survived and done as well as we have.

    • Re:Hard work (Score:5, Interesting)

      by SkArcher ( 676201 ) on Saturday December 27, 2003 @01:28PM (#7817903) Journal
      You could also try the OpenSource method of making a software business work, which is to release all of your mistakes and failures to the public with full annotation and then let them write the next version of the software while you sell 'support services' for it to the general populace.

      Works a treat for service products like Apache, where the service the software provides is the actual value of it, and the act of releasing the code to those interested simply means more patchers working on the problems. Likewise it works for common software like Office software, where the people who use it don't generally care to understand the code.

      Ironically, it fails in products targetted for sale to code-competent people, as this is a market that can support their own needs, but then this is a small market who could code their own product rather than pay any money anyway.

    • Re:Hard work (Score:3, Insightful)

      by NoData ( 9132 )

      I think "make more mistakes" is just a side effect of the real point: Take more risks. Obviously, if you take more risks, your probability of making mistakes also goes up. I'm sure if the error rate didn't happen to go up with risk taking (just getting lucky), no one would complain.

    • For technophiles, failing fast (working harder) has another distinct advantage: it's more fun. It certainly beats waiting on management/marketing types or worrying about the burn rate. Paychecks are ephemeral and should be treated as such. A good hacker ethic can, however, result in a lifetime of interesting things to do.

      • For technophiles, failing fast (working harder) has another distinct advantage: it's more fun.

        Oh, I absolutely agree. My point was simply that many people have no idea how hard it is to actually run your own business. You cognitively never leave it and are always thinking about it (why I like science, because like your own business, one can always think about science at all hours of the day). Some folks simply like the idea of being a business owner, but they dont actually like working that hard. A wo

    • Re:Hard work (Score:3, Interesting)

      by Artifakt ( 700173 )
      If your'e starting a business, maybe working your own ass off will help. If you're working in one, probably not.
      By the last set of figures I saw, the US currently ranks #1 in number of hours worked in the industrialized world, but only #3 in per person productivity. (The average US worker produces a contribution to the GNP of about 30 $ US per hour, while Great Britain was 50 cents (again US) or so higher, and the reunified Germany had assimilated the east German economy and was back up to about 33 $ US

      • Stats on the German economy. 0.2% 3rd Q growth. (Score:5, Interesting)

        by DAldredge ( 2353 ) * <SlashdotEmail@GMail.Com> on Saturday December 27, 2003 @03:24PM (#7818357) Journal

        A difficult year marked by slight hope
        Record losses at German blue chips, but restructuring and rationalization begin to show their effect

        january
        Economics Minister Wolfgang Clement issues a special ministerial permit to allow the takeover of Ruhrgas, Germany's main natural gas supplier, by Eon, one of Germany's two dominant electric utilities. The ministerial intervention overrules the Federal Cartel Office, which had warned against impaired competition both in the electricity and gas markets.

        february
        The stock market collapse, record insolvencies and belated restructuring and rationalization efforts have plunged German banks into a crisis. Commerzbank and Hypo-Vereinsbank both post the first annual losses in their corporate history. Experts predict drastic sectoral consolidation.

        march
        At 4.7 million, unemployment reaches the third highest level since unification. The jobless rate stands at 11.3 percent.
        Dresdner Bank Chairman Bernd Fahrholz is sent packing as parent company Allianz publishes the first annual loss in its corporate history for 2002, with Dresdner being the biggest burden.
        Deutsche Telekom posts a record loss of EUR24.6 billion for fiscal 2002, the highest loss ever posted by a German company.
        Wella's founding family agrees to sell the world's second-largest maker of hair-grooming products to Procter & Gamble.
        The Bundestag decides to extend shop opening hours to 8 p.m. on Saturdays. The new regulation will take force on June 1.

        april
        In their spring forecast, Germany's leading economic institutes project economic growth of 0.5 percent for 2003, revising downward their earlier forecast of 1.4 percent. The six think tanks expect the German deficit to reach 3.4 percent, exceeding the limit of the euro-zone Stability and Growth Pact. The government remains optimistic and issues only a slight downward revision of its growth forecast to 0.75 percent from 1 percent.
        Germany's most powerful industrial union, IG Metall, reshuffles its leadership. In a surprise move, the board nominates deputy head Jurgen Peters, a hardliner and ardent defender of Germany's extensive system of worker protection, as the successor to Klaus Zwickel.
        Frankfurt airport operator Fraport cancels its dividend and discloses a net loss of EUR120 million for 2002 after writing off an ill-starred airport project in Manila launched in partnership with business cronies of the discredited former ruler of the Philippines.

        may
        The German economy slipped into recession in the first quarter of 2003. Finance Minister Hans Eichel publicly abandons his longtime goal of balancing the federal budget by 2006.
        The level of management pay in Germany becomes a subject of public debate. Federal Justice Minister Brigitte Zypries of the Social Democratic Party demands the disclosure of individual board member salaries to improve investor protection.
        WestLB posts a record loss for its 2002 business year after admitting that it had to increase risk provisions for its London project-financing arm over a risky deal with British television and radio leasing company Boxclever.

        june
        Deutsche Borse closes the badly tainted Neuer Markt segment for young and supposedly fast-growing companies. A new, untarnished Tecdax index now serves as the benchmark for investors in stocks that would have been called new economy a few years ago.
        The collapse of life insurer Mannheimer Lebensversicherung becomes a first test of sectoral rescue company Protektor, which takes over all 345,000 contracts.
        West LB's multi-billion loss causes heads to roll. Public prosecutors investigate both its London group and several managers. Chairman Jurgen Sengera steps down, making way for interim Chairman Johannes Ringel.
        Robert Bosch acquires a majority of heating equipment maker Buderus, making Bosch the European market leader in this segment.
        Quelle becomes the first German mail-order company to sell cars over the Internet.
        After four weeks of industrial action, IG Metall boss Kl
    • Other companies (like Apple) certainly have their share of failed products, but they do not foist them on the public

      Care to explain the Windows version of QuickTime?

  • Fail Fast (Score:5, Insightful)

    by moehoward ( 668736 ) on Saturday December 27, 2003 @01:10PM (#7817812)
    "Fail fast" was the mantra of Tom Peters in the late 80's. I believe that he has since denounced all his teachings of the 80's and early 90's in order to cash in on a whole new "chaos" philosophy.

    I agree with the whole fail fast notion. Try stuff as fast as possible to see if it will work. I think we see this philosophy played out in things like RUP and Extreme Programming.

    I guess my point is that this news is 15 years old. Someone should search the Slashdot archives for a dupe from 1989...
    • > I agree with the whole fail fast notion. Try
      > stuff as fast as possible to see if it will
      > work. I think we see this philosophy played out
      > in things like RUP and Extreme Programming.

      er..not quite, with XP at least. They do test first [extremeprogramming.org] - the complete opposite of fail first.

      You write the unit test before the code, allowing 'immediate feedback while you work.'

      It might not pass the unit test, but at least you know it hasn't passed, thus it isn't finished

  • Software Company vs Restaurant (Score:5, Insightful)

    by superpulpsicle ( 533373 ) on Saturday December 27, 2003 @01:10PM (#7817813)
    I worry about the potential of any new software company nowadays. Personally I know 2 people who attempted to start their own business. One started a software consulting company, the other a restaurant.

    The software consulting company charges thousands of dollars for any gig and the business comes WAY too slow. I am talking once a month on the best case scenario. The other person started a restaurant and makes couple thousand daily. Just on take outs alone, $30 + $30 + $50... you get the idea, it adds up fast in volume. People can't get away with not eating. They can get away with no software upgrading.

    Basically if I had the money, I would start a gym, a club, a bar, a restaurant, a stripe club... anything but a software company in today's market. It's a shame to see globalization and everything IT related go so downhill.

    • Re:Software Company vs Restaurant (Score:2, Funny)

      by Anonymous Coward
      Basically if I had the money, I would start a gym, a club, a bar, a restaurant, a stripe club...
      A stripe club would fail! (I know I wouldn't want to be "spotted" in one!)

    • Re:Software Company vs Restaurant (Score:4, Insightful)

      by hey ( 83763 ) on Saturday December 27, 2003 @01:34PM (#7817925) Journal
      Sure restaurants make money but look at the overhead: reno the space, professional kitchen applitances, rent in good area - thousands a month, if its small 5-10 staff, food - if you don't serve you have to throw it out everyday, etc.

      Software company overhead: one DSL line.
    • Clearly you are speaking of yesterday's market. The software consultancy I work for (which charges at least hundreds of thousands of dollars) is just finishing our best year ever.

      Most companies slashed IT spending in 2001-2003, certainly. Most software companies that appeared in the boom died (thankfully, as most of them shouldn't have existed in the first place). 2004 shows every sign of loosening the purse strings, and upgrading all that software that's been getting stale.

      As to globalization, we're expe
    • You are overlooking the risk-return tradeoff under capitalism. A tech company is more risky than a restaurant business (of course, it depends on the specifics but I'm speaking in general). A tech company has higher rate of failure, BUT it will return higher profits IF it is successful. In general, risky companies have higher returns but have higher failure rates.

      YOU would start a restaurant (or a stripe club ;) ) because it is less risky. But someone else might go for a tech company because the profit m

  • What's important to know (Score:3, Insightful)

    by Rosco P. Coltrane ( 209368 ) on Saturday December 27, 2003 @01:14PM (#7817833)
    what's important for geeks to know when starting a software company

    Easy that one:

    - You can be 99.999% sure you won't become the richest, most hated guy in the world, or create the ROMs of an icon computer with a fruity name and end up teaching smalltalk to children.

    - Out of the remaining 0.001%, you can be 75% sure you company will fail miserably, just because your products don't stand out, or because your services won't be different, or because your prices won't be attractive.

    - Out of the remaining 0.00025%, you can be 99% sure your beginning of a success will attract shitty venture capitalists who'll try their best to make a fat pile of cash on your back by telling you to "go public" and "grab marketshare", ruining your chances of being profitable in the long run like you originally planned by growing organically.

    - If you're part of the remaining 0.0000025% who'll manage to make an honest, sustainable, sane affair in the software industry despite the odds, you damn well deserve a medal.

  • My first mistake.... (Score:3, Funny)

    by Anonymous Coward on Saturday December 27, 2003 @01:18PM (#7817860)
    ...was trying to read an MSDN article with Opera. Sends you to the deeptreeconfig.xml gulag.

  • My experience (Score:5, Insightful)

    by Anonymous Coward on Saturday December 27, 2003 @01:20PM (#7817869)
    When I clicked on this link I was sceptical, but after reading the story, and comparing it to my own experiences, this short no-bullsh1t essay should become compulsory reading in any MBA course.

    One of the things that amazed me about my experiences in running various different types of companies is how common-sense can often take a back-seat to "groupthink", doing what others tell you you should, without necessarily considering whether you think it is a good idea.

    Investors can be particularly dangerous. The problem is that many investors like to see themselves as having a mentor or sage-like relationship with entrapeneurs. Since they are the "money", entrapeneurs are often quick to indulge this fantasy and the end-result is that people whose company-running experience might be solely based on what they learned on the golf course from other similarly well-informed investors, find themselves a willing audience among those who might actually know what they are talking about.

    Investors aren't the only problem. There is a thriving ecosystem of people within large companies whose primary talent is climbing the corporate ladder, but whose actual contribution to profitability is highly questionable. During the tech boom many such people decided that they would try their hand at running small tech companies, often they would be brought in by investors to replace the entrapeneur-CEO, in the hope that they would be more "seasoned" (whatever that means).

    The results are generally disasterous. This happened in one of my former companies, and the guy was an idiot. He spent $100,000 (of $3MM funding) on a launch party just weeks after 9/11/2001, $50,000 on an "image consultant" buddy of his, and christ knows what else. It rapidly became apparent that he was incapable of doing the job he was supposed to do, but fell back on the tried and tested (big company) strategy of paying other people to do your job for you. With limited funding it didn't take long for us to run out of money.

    Anyway, I could go on, but the bottom line is:
    don't accept any advice on how to run your company unless it makes sense to you, irrespective of what anyone says.

    • I think the bottom line needs to be more than "don't accept any advice on how to run your company unless it makes sense to you, irrespective of what anyone says."

      Isn't this exactly what your aforementioned buddy did? At the time, didn't throwing that launch party make sense to him?

      I think the real bottom line is, don't get involved with businesspeople whose decision-making you don't respect!

    • don't accept any advice on how to run your company unless it makes sense to you, irrespective of what anyone says.

      Typically, once you bring in Venture Capital, its no longer your company but their company.

      But yeah, succeeding as a startup takes something completely different than running a multinational. Personally though, I recall our founder/CEO bringing in his buddies to take important roles despite their lack of capability, spending $$$ on management off sites to exotic locations, etc. So YMMV

  • Easy! (Score:5, Funny)

    by niko9 ( 315647 ) * on Saturday December 27, 2003 @01:22PM (#7817873)
    Post alot of Ask Slashdot's, and take the advice seriously. :P

    --

  • Use .NET? (Score:5, Insightful)

    by daviddennis ( 10926 ) <david@amazing.com> on Saturday December 27, 2003 @01:22PM (#7817877) Homepage
    About half of this seems to be telling us that he should have used pre-built Microsoft(tm) technologies instead of rolling his own.

    I wonder how this article would have been different if it were not posted on MSDN, where the self-interest of Microsoft in its current context is, um, obvious.

    D

    • Re:Use .NET? (Score:3, Informative)

      by grungeKid ( 4260 )
      Eric Sink is well known [ericsink.com] for liking the .NET platform. Since he has actual experience developing fairly complex products with both .NET and Java, I don't think anyone should be quick to dismiss him as a Microsoft fanboy.
    • ...I think several of his failures are really all about something that I've come across on several occasions.

      Timing is everything. In particular, if you get too far ahead of what today is really about, you get sucked into a lot of additional things that a small/medium business can do without - like having to build the market (lots of marketing costs), explaining everything to everyone.

      Anyways, all you need to do to "un-MS" this is to substitute other non-MS technologies where they are/were (or if they are

  • Missing a point. (Score:3, Interesting)

    by bstadil ( 7110 ) on Saturday December 27, 2003 @01:23PM (#7817882) Homepage
    The concept of increasing Failure rate only applies to companies htat has the resources to do this.

    Companies like Intel, HP etc can make blunder after blunder but still come out on top as they have the resources to "wait" for the winner, and more importantly put a lot of resources behind the winner once invented.

    Take Intel's Itanic, or the 860 this would have sunk any company but the very large. Intel's Yamhill is waiting in the wing in case The Custoenmrs want it [theinquirer.net] How may companies can do that.

    The Venture Capital stragegy centers around this Throw Mud on the wall and see what sticks and should more rightly be seen as Outsourced R&D that business start-up. FYI, More Start-ups get absorbed pre IPO than go public.

  • wrong title (Score:3, Funny)

    by arcanumas ( 646807 ) on Saturday December 27, 2003 @01:23PM (#7817885) Homepage
    Am i the only one who thinks that it would be more appropriate for /. to write it "Make more Mistaeks" ? :)

  • This gu (Score:4, Interesting)

    by litewoheat ( 179018 ) * on Saturday December 27, 2003 @01:28PM (#7817905)
    Its quite evident that this guy had lots of money. Lots of money makes it easy to make the bone-headed mistakes this guy made. He bought and office building!!!!! This guy does not belong at the top of a company. Don't listen to him. I created a company Rockstar Software [rockstar.com] with $8000 seven years ago. I know from where I speak. This guy is a total moron. Run away from his advice. Run far far far away.
    • Well I am running my own software business and looking for any pointers. Where can I learn YOUR method? Seriously - do I email you or have you shared your wisdom online?
    • Will you hire me please? :)

    • Re:This gu (Score:3, Insightful)

      by Quixote ( 154172 )
      Geez, Einstein, then why don't you write something about your experiences? He at least made the effort to pen down his thoughts in the hope that they might be useful for others. What about you?

    • I don't think that all of his advice was bad, but alot of the mistakes that he made were obiviously very, very, stupid. He was able to get his hands on lots of money, however he never took the idea of getting a lawyer into serious consideration. He may have found his market identity but I don't think that this will keep him from continuing to make bone-head mistakes. His biggest advantage has been that he has not lost enough money to collapse the company.

  • Alteration of rule (Score:5, Insightful)

    by SuperKendall ( 25149 ) * on Saturday December 27, 2003 @01:32PM (#7817915)
    In his dig at the Java platform he mentioned that "you shouldn't use bleeding edge technologies".

    This illustrates one of the dangers he did not list - "Don't learn the wrong lessons".

    I built a Java/Swing app around the same time. It was a pretty complex user app, not just a simple program - and we managed to completely satisfy the clients and make the program perform acceptably on a very low-end target platform (PII-133 with 32 MB of memory). For what he described (replacing a complex spreadsheet) he should have been able to complete the task.

    Why did our app work and his fail? Because we knew Java and Swing well by that point, and knew what was possible with some time spent optimizing. We had a plan in our head for how to reach a target level of performance that would be accepted and more than met that goal.

    The lesson he should have learned was "Know your technology well before you embark on a project". The reason why it's so important to learn THAT lesson is that it applies to any project, not just ones using "bleeding edge" technologies. The only difference between an established and bleeding edge technology is the level of support you MIGHT be able to find. And that is not enough of a difference to totally affect either failure or success.

    I think the most appropriate quote on this matter is one from Mark Twain:

    "We should be careful to get out of an experience all the wisdom that is in it -- not like the cat that sits on a hot stovelid. She will never sit down on a hot lid again -- and that is well; but also she will never sit down on a cold one anymore."
    • Agreed. What I noticed in his comments was:

      I chose Java because I was "head over heels" in love with it. I adored the concept of a cross-platform C-like language with garbage collection. We were hoping to build our Java expertise and make this exciting new technology our specialty


      Yeah, agree to a project for a big company, using a technology you aren't yet an expert in. Good call.
    • It's an article on MSDN, you were not expecting them to say use Java were you?

      • Sure I wouldn't expect them to say "Hey, use Java"!

        It's just sad to see an article like that lean so heavily to using only one technology (Microsoft) - even if it is on MSDN. I guess that's why I almost never read anything there, because the bias is just a bit too strong. There are other forums that at least range into neutrality.

  • Double the rate of decisions made (Score:4, Interesting)

    by Screaming Lunatic ( 526975 ) on Saturday December 27, 2003 @01:34PM (#7817924) Homepage
    It's not really the rate of failures that need to be increased. It is the rate of decisions made that needs to be increased. Subtle difference.

    Increasing your rate of decisions made may increase the number of failures. But it should also increase the number of successes.

    There is no point in sleeping on a decision when their will be another bucket load of decisions to be made tomorrow.

  • The overriding lesson I got out of this is that a techno-geek starting a business is like a person who loves to cook starting a restaurant. To succeed at figuring out your business model, market research, pitching to financiers, managing employees, buildings, etc, etc, etc, requires a true business geek, not a tech geek. The people who should start tech businesses are the ones who truly love business as well as technology, or those who can find a trustworthy business-genius partner. Incidentally, the pitfalls of the latter approach are showcased in the documentary film Startup.Com [salon.com].
    • I completely agree. As a rabid business geek, I want to hit people who suggest openign their own comapny because they can code. A business is no more writing code than selling cars is making a sandwich. I don't care what you make/do/sell... there's a LOT more to any successful business than non-business people(note: you writing OSS projects that never see the light of day in your bedroom is NOT a business). I actually had one chick tell me a few months ago that my business is successsful because "I got
      • As a rabid business geek, I want to hit people who suggest openign their own comapny because they can code.

        Why niot just wait and see if they fail on thier own? You might just discover that the code monkey in front of you not only knows how to code, but also knows enough accounting, law and management to be able to hire the rest that he needs to succeed. You business types sget so incredibly defensive over what you think of as your territory, but I guess that's part of what makes you a business type.

        A

  • That's all dandy (Score:2, Insightful)

    by Anonymous Coward
    But one thing he doesn't explain is where his existing money came from. Where did that $150K come from? How did he pay for his existing developers through all this turmoil? How did he pay his own way?

    I think the one caveat he needs to preface this with is:

    "Before reading any of this, know that you should have about $2,000,000 saved up. Don't have it? Stop reading - you can't even make the mistakes described below anyways."

    • Exactly right. "Bought my own office building in our second year" is a dead giveaway--a year-two cash outlay of probably several hundred thousand, plus the ability to sell said multimillion-dollar asset at a loss one year later, are pretty clear indications that this was not your average, "cash strapped" startup. If I had millions in the bank, I would certianly be employing this guy's foolproof, trial-and-error method of starting a business as well :)

  • Its paperwork not failure (Score:3, Interesting)

    by pixelgeek ( 676892 ) on Saturday December 27, 2003 @01:38PM (#7817941)
    One issue I had with the article was this comment:

    "At the risk of being too obvious, let us observe that every ISV is started by an entrepreneur who somehow overcomes fear of failure."

    I think the fear of paperwork is probably just as powerful a deterrent as fear itself. I know that I'd rather have a software project bomb than have to deal with all the forms and paperwork running a business generally entails.

  • I disagree about the failure stuff... (Score:3, Interesting)

    by vudufixit ( 581911 ) on Saturday December 27, 2003 @01:42PM (#7817953)
    I think having many failures is a symptom of the important trait of persistence more than a prerequisite for success.
    Let's take someone who has done well with a particular business. They can become complacent, rot and die. Or, they can pick out what was behind the success, suss out what was plain dumb luck or the result of excellent ideas, planning and execution. Then follow up by doing more of those good things.

  • Comment removed (Score:5, Interesting)

    by account_deleted ( 4530225 ) on Saturday December 27, 2003 @01:48PM (#7817974)
    Comment removed based on user account deletion
    • In general I agree with your point, but do realize he was working on a word processor, something which was easily done and redone 100 times before, with numerous market giants past and present holding 100% of the market. MS Word, WordPerfect on the commercial side and dare I say OpenOffice in the open source side (StarOffice at the time, under a commercial banner).

      Was there any compelling market need for another word processor, open source or not? I don't think there was. Even if AbiWord had been a comm

    • Not a business model. (Score:3, Insightful)

      by Svartalf ( 2997 )
      It's a development model, nothing more nothing less.

      Anyone that thinks that it's a business model and moves forward from that premise is certain to fail and most likely spectacularly. Red Hat's not in the "Free Software" business, they're in the software and solutions business- they just us a LOT of Free Software to help accomplish these solutions they sell. There's other examples.

    • This is a logical fallacy known as a hasty generalization. You're arguing that because one open source project failed to sustain a business model, all open source projects will fail to do so.

      That may be true, but your argument fails to support it.

    • Nice troll, however if your looking for Open Source business models look no further than Doc Searls December article in Linux Journal "Free Business".

      http://linuxjournal.com/article.php?sid=7125

      "Take, for example, the junkyard business. Last week, I was talking with my friend, Allan Harrell, in Phoenix, who has ties with body shop, body parts and junkyard businesses, even though his main job is keeping small business networks and computer systems up and running. After telling me how full his plate has be

      • Comment removed based on user account deletion
        • "I asked for examples of successful companies that make money by developing and selling open source software."

          No you didn't. You asked for nothing of the sort.

          You did use a lot of rude terms like "zealots" and "nuts" and referred to Open Source as though we thought it was a religion. Your post was loaded with rudeness and arrogance and you do seem to really get off on calling people names. That's why I called you out as a troll, because you sound exactly like one. Your arguments were purely emotional,

          • Comment removed based on user account deletion
            • You didn't hurt my feelings, you insulted your intelligence. Your post was almost entirely purely insults and rants. A poor way to "debate".

              "Give me examples of successful companies that make money by developing and selling open source software."

              Any Linux distro that earns money such as.. Redhat,Mandrake(Out of bankruptcy now and looking good),Apple,Microsoft(shared source),Oracle,Sun,SGI,SleepyCat Software,VA Linux systems,Penguin Computing,MySQL,RMS( sold customized versions of emacs),Zope,Open Fusion

    • "Good for biz" != "Retail sales! Profit!" (Score:5, Insightful)

      by Rahga ( 13479 ) on Saturday December 27, 2003 @02:20PM (#7818088) Journal
      There is no one open source business model... in fact, open source tries to be as business agnostic as possible. What open source is, however, is an excellent software development model. There's plenty of people like my employer who use open source technologies and understand my obligations to patch, report bugs, and otherwise support the software we are exploiting. It helps us get our job done.

    • I wish i had mod points to give you because i would boost your karma. great post.

      when i read that paragraph i was thinking the same thing. only you wrote it much better than i would have...

      Maybe the next open source user that wants the "world to be free" will think for a extra second before they go off on another tirade like how gimp can be a real competitor to photohop. Paintbrush pro? yes. maybe.

      But photoshop nope. theres a reason why its a better product. Its becuase they know the harder they work at
    • That says a lot about the "open source" business model, doesn't it?

      There are countless open source business models. What this says is that this particular open source business model sucked. Just about anybody could have told him that, and apparently just about anybody did.

      Now the nuts can come out of the virtual woodwork and start screeching about the one true religion of open source, but he fact is that not one in a hundred thousand of them has successfully started a major corporation that develops a
  • One of the things to remeber is that the people you are aiming for might not be techincal. Just because product X can do "this nice geeky thing" most people won't care. They want something that works quick and well.

    Also any websites should be about the person, what the product can do for them. Not about the company.

    Rus
  • make: *** No rule to make target `more-mistakes'. Stop.

  • Ok, I like coffee too but... (Score:4, Funny)

    by mo ( 2873 ) on Saturday December 27, 2003 @01:57PM (#7818002)
    From the article:
    It involves market research and number crunching and presentations and conjecture and coffee, all of which are critical elements of business success.

    All too often these days companies place too much emphasis on market research and number crunching and not enough emphasis on coffee.
  • Ok, love him or hate him, I once heard Tony Robbins say the coolest thing about just this topic. Don't know if he made it up or ripped it off, but it doesn't matter:


    "Success comes from good judgement.

    Good judgement comes from experience.

    Experience comes from bad judgement!"


    Make lots of mistakes, but, more importantly, learn from them all.


    Jeff

  • I have some problems with at least ONE of his... (Score:4, Insightful)

    by Svartalf ( 2997 ) on Saturday December 27, 2003 @02:14PM (#7818060) Homepage
    ..."lessons" learned.

    "A market with no competition aint"


    That's pure unadulterated bull- and anyone with business sense KNOWS this.

    A market with no competition may not be a market afterall, but it may also be an untapped, unsold to market as well. You take a risk entering into a market with nobody in it- but someone has to be first into it. Let only the big players or the bold ones get into there first and then collect the tablescraps? Bullsh*t. Utter bullsh*t.

    Anyone that takes this man's advice to heart is setting themselves up for limitations, etc. that may actually doom your business as much as he did his for the early part of it's existance. Better yet, he's currently making products that compete with SourceSafe- which means he's got PVCS, ClearCase, Perforce, and Seapine to deal with as competitors as well. I hope he's got a MUCH better product than all the above and a LARGE budget for advertising and all.
    • That's pure unadulterated bull- and anyone with business sense KNOWS this. ... A market with no competition may not be a market afterall, but it may also be an untapped, unsold to market as well.

      He was trying to be too cute with his lessons. If you read the story leading up to that rule, you find the real lesson in the last sentence, "RADish was designed to solve a problem that almost nobody has."

      So, I'd say the real lesson from his story is "Don't try to sell solutions to problems that don't exist.".

  • Good Read (Score:3, Interesting)

    by Anonymous Coward on Saturday December 27, 2003 @02:21PM (#7818092)
    this article is a good read for anyone thinking or in the early stages - we've been there, done that especially:
    1) betting on java (bleeding edge) for a gui based program
    2) spending too much on office space

    Eric is right on about reading - key on the books where people tell their war stories and software books like "Microsoft Secrets", "Inside Intuit", etc - my favorite book is Charlie Ferguson's book "High Stakes No Prisoners" especially where he talks about spending 3 months of decision tree analysis - looking back, that could have saved me $300,000 that I couldn't afford to lose - always have backup plans for all the mistakes you are going to make, or when external things go against you.

    And btw - notice most of these stories have pretty smart Ivy League and MIT guys telling you how hard it is and how much they screwed up. In short, it's very hard, odds are against you, you must be very, very careful, and you must keep money coming in no matter what you have to do because you must use the 3x rule: plan carefully how long or how much it will take and multiply by 3 - uh huh, works out about right. And yes, don't drink the coffee, sell it - it's much more profitable.

  • Interesting... (Score:2, Interesting)

    by hao2lian ( 726435 )
    "Robert Scoble, weblogger extraordinaire, recently said, "I want to see more software companies, not fewer." I heartily agree."
    I'm guessing Bill Gates isn't the author here.

  • Make More Mistakes! (Score:3, Funny)

    by sklib ( 26440 ) on Saturday December 27, 2003 @02:34PM (#7818144)
    I think we've finally uncovered SCO's core business model.

  • How do they get the location of the phone? I have a nokia 6800 on ATT. It has GPRS is there any way for me to get location data from it. (I just skimmed their website for this info and gave up)

  • Let's be serious here (Score:3, Informative)

    by Bytal ( 594494 ) on Saturday December 27, 2003 @03:05PM (#7818258) Homepage
    This article isn't for a startup, it's for an established company. Saying that a $28k project was serious underbidding would be a dream come true for some startups out there. A real bootstrap startup doesn't exactly worry about whether they should buy their own building or not since they're too busy worrying about actually getting customers. And speaking from experience, trying to start a company in a high-tech company dense area like NYC or San Francisco is even harder. SourceGear being based in Illinois is in a very different position to bargain then a company which has to compete with hundreds of other bids on every single project. The most important thing that startups should realize is not that you shouldn't trust VCs or that you should mind your lease but that competition is tough and when you are surrounded by lots of technically savvy companies those marketing and networking(people not LANs :)) skills some so quickly dismiss basically make or break your firm.
  • Interesting article, but I dispute the premise in paragraph 1 that states the world is ready for more software firms. While his comments were self-serving, I agree with Larry Ellison that probably 80% of the software firms in business now have no long-term future. The market is already shaking out badly, and the writing is on the wall for anyone who isn't first or second in their market - GET OUT OR BE PUT OUT.

    Outsourcing has made the life of the small ISV even harder - for what it costs you to hire ten Bay

  • I've started my own startup company, and so I can tell you from experience: give up now. Screw the brass ring; it's only an illusion. Don't live your dreams, because the odds aren't just against you: it's certain you will lose.

    "The mass of men lead lives of quiet desperation." -- Thoreau. Those are the smart ones: the rest of them lead lives of noisy, soul-crushing misery. "Quiet desperation" is the best you can hope for. That's why the mass of men do it.
  • that by writing his own platform instead of using a pre-made one, the code on top of it will never break just because someone released a new version of the platform. He can interface with .NET if he wants, but the Web Services platform he built under/into his product will not change until he wants it to.

    It was a good article, but he ought to have reaped the benefits of what he had done by now, and thus mentioned it. I have in my time.

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