Ian Landsman is Starting From Scratch:
HelpSpot on the Deck
Starting today you’ll be seeing HelpSpot ads on The Deck ad network. It’s the first serious advertising I’ve done for HelpSpot so I’m excited to see how it goes. I was originally looking for September, but they had a slot open up in August so we decided to take it even though I only found out yesterday.
The ads were a little rushed, but I don’t think they’re bad. Ads are going to be very much trial and error anyway. We can swap them out at any time so if one or both bomb we can make an adjustment.
The Deck certainly puts HelpSpot on some interesting sites. I wouldn’t say it’s a perfect match in terms of sites that people search for help desk software on, but I think the audience it reaches are certainly people who directly or indirectly deal with customer service a fair amount.
We’re going to run for 2 months as a started to see how it does and go from there.
Help Desk Talk Redux
So a few years ago I tried to launch a forum/community website around the help desk/customer service world. It was a complete failure. It’s unfortunate because there was some early traction, but I couldn’t devote the time or money to maintain it and it was overrun by spammers so I ended up taking it down.
Over the past few months I’ve thought of bringing it back and after asking around a bit I’ve decided to do so. I still don’t have much time, but HelpSpot is in a much more established position than it was then, so is the business and so is my ability to bring on help if needed.
The thing that keeps bringing me back to this idea is that there’s simply nothing else like it out there. Help desk related forums are always buried deep within general IT sites where they don’t belong. The help desk organizations have forums, but those are usually buried below white papers and conference announcements. There simply has to be room for a forum dedicated just to help desk professionals.
So this will be my last, best attempt at it. As often is the case I’m really going to lean on the support system that’s been built up on this blog and elsewhere online. If you have a blog, a link would be insanely appreciated. If you work on a help desk, tell your co-workers. Little things make all the difference in this type of venture and your support is truly appreciated!
HelpSpot Price Nudge
A price nudge sounds better than an increase, no? I think so. In any event today I’m announcing a small price increase for HelpSpot. The short of it is that HelpSpot is moving from $179 a user to $199 a user as of August 31st. This is about an 11% increase.
Important to note is that the support costs remain unchanged. So it’s still $49 per user per year for ongoing support.
There are a number of factors that went into making this decision. As always I thought it’d be nice to share, so in no particular order here’s some of my thinking:
1 - In September it will be 3 years (Wow!) since the first HelpSpot beta launched. The final release was in late October. During the past three years HelpSpot’s price has remained unchanged, while our competitors continued to increase their prices. Currently HelpSpot is less than half the price of many major competitors and many times less than others.
That said, HelpSpot does have a unique place I think in this market. It’s very accessible price wise and I didn’t want to put it out of reach for smaller companies, departments, and non-profits.
2 - Probably my favorite pricing article is Product Pricing Primer by Eric Sink. One of my favorite lines is “In fact, if nobody is complaining about your price, then it is probably too low. The trick is to tune your pricing until the volume of the whining is just right.”. For the past year or so we pretty much get no feedback on the price being too high and a great deal of “Wow, you’re giving this away, I’d pay $350/user”. Now, I’m not going to jump to charging $350/user, but I think Eric has a great observation here and it’s been a big consideration as to the timing of the increase.
3 - As with most businesses increased growth leads to increased costs. So far I’ve done a pretty good job of keeping those costs down, but I think over the next year we’ll be taking on some new costs and this increase is going to help offset those.
4 - One thing I don’t want to lose is the perception of HelpSpot as a high quality product (which it is). A products price unfortunately does have an impact on that perception. As with most companies I’m trying to find the right balance and I certainly don’t want to fall down into the “cheap” bin. This one is a little more fuzzy I know, but it just felt like time to nudge up a bit.
5 - A price increase helps to bring our support cost percentage inline with customer expectations. Many customers like to see maintenance costs at 20-25% of the license costs. I personally find this a little unfortunate for us as most companies are buying only support for that percentage and are not receiving major versions as part of it. So they’re paying that and then paying more license fees when the next major release comes out, where that’s not the case with our plan. In any event, this will be one positive side effect of the increase.
That’s pretty much all the hard facts. So much of pricing is just feel, so this is my first chance in three years at testing my feel. Given how conservative the increase is I don’t think they’ll be much controversy, it’s probably going to come down to deciding if I’ve left too much on the table. My initial reaction was to go for something like $229, but I’m very hesitant to move over $200 especially given the economy.
Time will tell and I’ll try and report back towards the end of the year when I’ll know a bit about how it’s worked out. If you’re interested you can see the new pricing for the various packs here: http://www.userscape.com/products/helpspot/pricing.php
Building an App in 30 Days … Is Stupid
All the rage the last year or so seems to be trying to build an application as fast as possible. The common length of time seems to be 30 days, but it sometimes goes down as low as 7 or even 5. While this may be an interesting idea as a publicity stunt for an established company or for a Google engineer using their 20% time it’s about the worst idea a would be MicroISV can take up. In fact, I can’t think of a better way to ensure failure in a software venture (a venture you hope to replace your full time job with).
I assume this has come about from the new mantra of release early and often. Those ideas may be good ones, but for a one man show putting an arbitrary limit on the development of your product is suicide.
Let’s address some of the obvious problems first. Software worth building is likely to take you more than 30 days! If it was that easy it’s more than likely already been done or will be copied in moments. A more pressing issue is that it trivializes the rest of your business, which as you know is 95% of having a successful business. So the developer kills themselves for a month to get out a product. Now what. No groundwork has been done to make the product a success. You have a product and have done no marketing, have no plan for support, and no back office tools for management of your ecommerce and application delivery. In short you have a product with no business.
Sure, it’s possible this 30 day app will be the one in a million that’s so spectacular that all those things are optional. Personally I prefer to work towards success rather than hope it finds me.
My biggest problem with the spread of this idea is that it leads the MicroISV down the wrong path. The path of the quick buck. But there’s no successful business down there, there’s no quitting your day job down that path. So when the 30 days are through and many of the most important features have been cut for time the developer is stuck at the end with a half an application and so much to do.
30 day apps are just the dork version of a grapefruit juice diet or buying foreclosed real estate with no money down. My advice to those tempted by it are to put that month to work on marketing, product idea research, business reading/research or just enjoying the summer 
Great Post on Selling to the Government
Best post I’ve read in a while: http://nukemanbill.blogspot.com/2008/06/government-whore.html
I also suggest you check out his first post, which I agree with pretty much 100%: http://nukemanbill.blogspot.com/2008/05/first.html
Antair’s New Blog
Andrey has a new blog up. It’s been a while, good to see him back in the fold. One of his first posts is about HelpSpot, thanks Andrey!
Modules You’d Like to See in HelpSpot Version 3
I’m nearing the end of planning for version 3, but to be honest I’m going back and forth on a couple of modules that I want to add. So I’m looking for input. If you have a new module you’d like to see in v3 please post a comment here. I’m not talking about features of existing functionality here, I mean all new areas. Think new top tabs. If there’s something you’d really like to see added please post it and give me a short explanation of why you’d like it included.
The usual disclaimers apply, there’s no guarantees that any ideas here will be included, but your feedback is taken very seriously and is always a major factor in my planning.
A Look Back at HelpSpot’s First 6 Months of Sales
Now that HelpSpot has been out about 3 years I thought it would be fun to look back at the early days. I always get a lot of questions about how I started UserScape, how long it took to get rolling, what the process was like, etc. I think a look at these numbers might be interesting for new software entrepreneurs. Enjoy.
Month 1: October 2005
HelpSpot was released on October 24th 2005 (my birthday, yeah!). For 4-5 months before that while I was in development I really focused on building up some semblance of a beta group. I think I got about 80 companies to sign up for the beta, though since it was over a long period probably only about half actually participated (I don't remember really). I offered a 50% discount to the initial beta group which I think worked out really well. Many of the people who participated provided invaluable feedback, even some who didn't buy it. The sales numbers below reflect the 50% discount:
| October 24, 2005 | $872.96 |
| October 24, 2005 | $179.00 |
| October 25, 2005 | $1,599.50 |
| October 25, 2005 | $89.50 |
| October 26, 2005 | $447.50 |
| October 26, 2005 | $89.50 |
| $3,277.96 |
I was pretty ecstatic over this first week of sales. While it's hardly huge money, it gave me some validation that the ideas in HelpSpot were what at least some in the market were looking for. This is one of the big reasons I think startups shouldn't hide what they're building. Startups should use their development time as an opportunity to market themselves and build up a group of interested individuals. Otherwise, you have to do all of that after you release and it means you're not going to get any sales for months after you release which is going to be extremely discouraging.
Month 2: November 2005
I knew this was going to be a rough one. Most of the beta people who were going to buy had done so and now I was going to have to build up my trial users. Since the trial is 45 days and most companies take a while to pick their help desk solution, November was bound to be slow and it didn't disappoint!
| November 2, 2005 | $626.50 |
| $626.50 |
Yikes! Even though I knew it was coming, a little fear did set in.
Month 3: December 2005
Sales picked up a bit here, though one sale a week is a little nerve racking. On the up side though it gave me time to continue to improve HelpSpot which I did. Some of the 1.x releases were the most important as they really added core functionality that was flat out missing.
| December 2, 2005 | $1,969.00 |
| December 7, 2005 | $875.00 |
| December 13, 2005 | $1,140.00 |
| December 29, 2005 | $179.0 |
| $4,163.00 |
Month 4: January 2006
Again I suspected sales might be weak in January due to the Holiday's in December which limited trial sign ups and I was right. January was light.
| January 22, 2006 | $895.00 |
| January 27, 2006 | $358.00 |
| $1,253.00 |
Month 5: February 2006
Things started to pick up in February again and it's really from here that it started to take off. After this month sales climbed higher and never really looked back. Here you also see the number of transactions starting to increase slightly. Given that I don't do any advertising having more transactions means more customers talking about the product which is really key for HelpSpot.
| February 2, 2006 | $773.28 |
| February 14, 2006 | $179.00 |
| February 16, 2006 | $494.19 |
| February 18, 2006 | $193.99 |
| February 21, 2006 | $1,074.00 |
| February 26, 2006 | $1,253.00 |
| $3,967.46 |
Month 6: March 2006
Ah, spring time. Finally a nice up tick in transactions and revenues. You can also see the nice mix of customers that are starting to appear. The little 1 and 2 man shops along side the 10-20 user licenses.
| March 1, 2006 | $456.45 |
| March 1, 2006 | $179.00 |
| March 2, 2006 | $358.00 |
| March 6, 2006 | $1,586.40 |
| March 8, 2006 | $358.00 |
| March 8, 2006 | $402.75 |
| March 9, 2006 | $179.00 |
| March 15, 2006 | $179.00 |
| March 16, 2006 | $179.00 |
| March 22, 2006 | $194.43 |
| March 22, 2006 | $1,074.00 |
| March 29, 2006 | $179.00 |
| March 29, 2006 | $3,199.00 |
| March 29, 2006 | $179.00 |
| $8,703.03 |
This month also has some of our first transactions where customers are purchasing additional licenses. This ends up being a major revenue source as companies start using it in just one area, but expand to others or expand to more staff in the same area.
Wrap Up
I hope this was interesting. I don't think I've seen a B2B app break down their initial days like this, hopefully it's another useful nugget of information and motivation for the would be entrepreneur.
What Should I do with 50 iPods?
Apple sent me an interesting email today. They have a special program for companies that want to buy iPod’s in batches for use with promo programs. The minimum order is 50 and it can be any iPod type or even a mix of them. I’ve never been big on promo’s though. On the other hand with the discount I don’t think it would be a ton of money to buy 50.
So do you have any ideas of a promo that could be run? Ideally it will help build HelpSpot brand awareness in some way, but I’m not doing anything sleazy like just giving them to people to who link over or anything like that. Perhaps you’ve seen some well done promo’s along these lines before? If nothing else I thought it might be interesting to kick around so let’s hear some ideas.
HelpSpot 2.4 Beta is Out!
Whew, this release has been a bit more work than I intended. I think it’s a really strong release though. It’s one of those releases where on the surface it’s not much different but there’s a lot of meat just below. If you’re interested you can find the full release notes here: http://www.userscape.com/helpdesk/index.php?pg=kb.page&id=190
There’s a bunch of performance improvements with filters and I think I’ve finally got the javascript caching down. All the javascript libraries are now minified, gzipped (if available) and cached. In addition, the browser now gets complete caching headers which should force long term caching. This should prevent them from being re-downloaded in some troublesome browsers 
Some of the more requested features that are in 2.4 include the ability to set the inbox as the default for a category, a customer login for checking request history, round robin auto assignment for completely even workload distribution, and improved loop and stuck email protection.
If you’re a HelpSpot customer or trial user and you’d like to participate in the beta just enter your email in the form below. I’m going to collect names for the next few days and then send out another round of beta emails.
Follow me on Twitter
Just an FYI, if you haven’t subscribed to me on Twitter please do. I still write here from time to time, but it’s hard to find the time for full blog posts these days. The low commitment level of Twitter allows me to normally post several times a day. You’ll also get more details about ongoing HelpSpot development than here as I sometimes Twit about what I’m working on right then.
Talking to the Owner
There’s something really great when you can talk directly to the owner of a business. It’s a feeling you don’t get a lot in the virtual world I mostly deal in unfortunately. What’s got me thinking about this is that we’re building a patio around our pool (previously it was incomplete and just dirt!) and most of the companies I’ve gone with for the various components are small. The owner is on site at least part of the day here. It’s great to be able to talk directly to the guy making the decisions, the one who’s name is on the line.
Being able to talk to me is one of the main reasons for HelpSpot’s success in my opinion. Customers love having direct access to the decision maker. Of course, as a company grows the founder can’t answer the phone forever, but it’s an element I plan to always retain in some capacity as UserScape continues to grow.
Refreshing Post
Dennis Forbes with (as usual) a refreshing post. http://www.yafla.com/dforbes/Be_Bad_Or_The_Startup_Lottery_Ticket/. If you’re thinking of starting a business I can’t emphasize enough how important it is for you to read this post and take it to heart.
New Computer Setup
As usual I haven’t posted in a while. Since it’s Friday I’m not in the mood for anything too heavy so I thought I’d post about my new computer setup. So far it’s been amazingly productive for me.
First a little history.
The first setup I had when I started UserScape was a Apple G5 Tower with a couple gigs of ram (some may recall how a bad drive almost ended UserScape before it began). This setup had 2 Samsung 17” monitors.
That was OK for a while, but I got tired of being stuck in one location all day. So then I moved to a MacBook Pro, 3GB ram. I also purchased an Apple Cinema 23” display along the way for when I worked at the desk. That’s what I’ve been using up until last month, but the truth is I’m mostly at my desk these days. When I’m not at the desk I’m only doing coding, never really support or other business that requires the horsepower of the MB pro.
Given all this I decided to move to a high end desktop and a new laptop optimized for portability.
The new desktop setup is an Apple Mac Pro tower with 16GB ram (cheap from www.macsales.com), 3 hard drives (more in a moment on that), the same 23” Apple Cinema display as before. For portable computing I got a MacBook Air.
So far this setup is fantastic!!!
The desktop is great as I can easily run multiple VM setups for different Windows/Linux installations, Photoshop, BBEdit with 8 million documents open, multiple browsers with dozens of tabs and all without the system showing any signs at all of being loaded down. I’m also one of these people who never turns their computer off and so far the Mac Pro hasn’t broke a sweat.
The MacBook Air (MBA) is turning out to be the perfect compliment to this setup. It seems that I’m the ideal candidate for the MBA. It could never be a primary computer for a serious business person, but it’s a great second computer. It’s insanely light, powerful enough for coding PHP applications, and handles a single browser with many tabs no problem. I don’t bother with any VM’s or heavy apps like Photoshop on it since all that is on the Mac Pro. I couldn’t be happier with this little sucker. Battery life also seems very good so far and the screen is great.
As the link above indicates I’ve learned my backup lessons the hard way. So the Mac Pro is setup with 2 350 Gb drives in RAID 1 for mirroring. If one fails the other has all the data. I have a 3rd 750GB drive being used as a Time Machine backup drive for versioned backups of all the files on the raid disk. I also have an external hard drive which I use with Super Duper so that I always have a bootable version of the raid disk available.
I’m also using Jungle Disk to backup selected items to Amazon Web Services which is working out great. I haven’t cleared out my account from the backups of the MacBook Pro yet so up there I basically have duplicates of everything. With 50GB+ of data up there and lots of requests for the initial upload my bill was $30!!
Overall, if you have some money to spend on your computer setup I can’t imagine a better setup than this. My productivity has dramatically increased with the Mac Pro (and full time use of the big monitor).
HelpSpot 2.4.0 Beta
Development on HelpSpot 2.4.0 is finally starting to wrap up. This release contains more than I originally intended, but I think there’s a lot of important improvements especially as I plan on hunkering down to focus on version 3 development for the rest of the year.
This is one of those releases that won’t have a lot of flash on the surface, but adds or improves on many things which are day to day pains or potential issues for certain types of installations.
So if you’re interested in participating in the beta please post on our forums and I’ll get an email to you when we’re ready to get rolling.
Expression Engine 2.0 Preview
The guys at EllisLab have released a preview of EE 2.0. It’s fantastic, I love it. The UI is really nicely done. I especially like how it’s catered to their market so well. You can tell it’s going to be really easy for non-tech folks who have to maintain websites to get around and use the system.
http://expressionengine.com/forums/viewthread/74102/
Ebook on Generating Web Traffic
Stephane yesterday released an interesting book on generating traffic to your site. It’s remarkably in depth. I’ve only read some of it so far, but what I’m most impressed with is the breadth of the coverage. It pretty much hits on everything someone starting a commercial website needs to think about.
Competitive Advantage
Great post by Rick about competitive advantage among other things. I agree with this 100%. I’ve found that fast and great service are the easiest (in a certain sense) way to outperform your competitors. This is especially true of MicroISV’s and small ISV"s. It sounds counter intuitive, but it’s not really.
As you get bigger the service gets farther away from YOU and generally service gets worse. When you’re small it’s easier to provide great service and control the service environment. That’s something Rick has done a great job with as his company has grown and it relates directly to what he mentions about controlling growth.
My #1 advice to new ISV’s when they email in is to provide great (and fast) service.
Winter
It’s snowing like crazy here today.
Doesn’t this look like my wife and son are walking into a photo from the 1850’s
That’s an old rail bridge that runs next to our house. It’s pretty interesting. At one time it was the longest bridge in the world.
Sites that Sell!
Bob Walsh has released his eBook MicroISV Sites that Sell! - Creating and Marketing your Unique Selling Proposition. HelpSpot is one of the apps featured in it. For $19 it’s worth checking out if you’re planning to start a software business.