[Rakathos]

(Blog post author here)

I wondered where the random burst of traffic came from.

For those who haven't read the more recent posts, I received a ton of great feedback from HN and other entrepreneur friendly places. I've also been gobbling up great advice from places like Rob Walling's "Startups for the rest of us" podcast.

About a month ago I started a "challenge", inspired by Brennan Dunn, to rebuild my "failed" product, and it's been going pretty well so far.

Most importantly, a few days ago I announced that I'm "pivoting" from just inventory management to a full-blown ERP for printing companies. I chose printing companies because I'm a full-time developer at a printing company, and I know exactly what kinds of problems we face with our terrible ERP system. Though I need to be super careful not to build a system that is so focused only my own company can use it.

If there's one piece of advice I could give somebody else, it would be to narrow your niche like I did with printing companies. This has helped me so much it's downright ridiculous.

Edit: Also, when I originally posted the article some people were concerned that I was just trying to build a "meta" product with Iron Conversions. I admit I had planned to build a product with it, but I've put that on hold indefinitely in favor of rebuilding Rakasheets. I don't know if I'll ever return to it, so for now Iron Conversions is just the place I'm blogging about my progress.

[runako]

Fascinating writeup. A couple of quick thoughts:

- It sounds like one of the problems you ran into was massive undercapitalization. While some businesses can grow without spending anything on staff, promotions, marketing, etc., that's not the norm. Figure out how you can inject more resources into your business. Cash/barter/debt are all viable strategies (although debt is a potential time-bomb.)

- <4 months part-time is't really enough time to spend on a business before evaluating it as a failure. While pivoting may make sense, I'm pretty sure that $300 + 120 days doesn't generate enough data to say anything conclusive.

- SaaS products like Rakasheets are deceptively expensive for customers. This is good for the SaaS provider. Your middle-priced plan is ~$700 annually; factor in low turnover if you do a good job, and you're basically selling software in the $1500+ range. Keep this in mind when figuring out how to promote your product. The cheapest promotion channels may not be best for a relatively high-priced (vs consumer-targeted) product.

- If you're low on cash, try direct sales to start. That's you on the phone, or sending email. Or getting in your car and driving, if your area warrants it. If you're really offering something that will benefit your prospects' business, they want to hear from you.

Good luck!

[Rakathos]

> <4 months part-time is't really enough time to spend on a business before evaluating it as a failure. Wile pivoting may make sense, I'm pretty sure that $300 + 120 days doesn't generate enough data to say anything conclusive.

There was a lot of hubbub before about calling the whole thing a "failure". I should have made it more clear that I wasn't calling it a failure because I spent 4 months and only got one customer. Instead I was calling it a failure because I was no longer interested in what it did, and I had no intention of working on it any longer.

> SaaS products like Rakasheets are deceptively expensive for customers. This is good for the SaaS provider. Your middle-priced plan is ~$700 annually

This is something that I hadn't even considered until an actual small business owner sent me feedback saying the exactly that. Previously I thought people were like me, and only considered monthly costs of products unless they were buying an annual plan. It may be that I'm alone in that.

There's also the issue of how many inventory items I would let each plan track. The smallest plan, which was $29/month, only let a user track 25 inventory items at a time. That's a laughably small amount of inventory. I attribute this to not targeting a specific type of customer, but it could also easily be attributed to not thinking it through.

> If you're low on cash, try direct sales to start. That's you on the phone, or sending email. Or getting in your car and driving, if your area warrants it. If you're really offering something that will benefit your prospects' business, they want to hear from you.

I live in a small town of less than 4000 people, and the nearest printing company other than the one I work at is an hour's drive away. That makes it hard to talk to them in person while still holding a 9-5 M-F job.

With that in mind, there's really no excuse for me to avoid cold calling potential customers. If my own printing company is an indicator, sales won't be made until numerous phone calls have been made.

[bradleyjoyce]

This. I was really surprised how short the timeline was from creation to declaring failure.

If you're able to build something that fast, give yourself some time to figure out how to turn it into a business!

[hamburglar]

I'm glad to hear you're going back and refocusing the original project. I have to admit that when I got to the "Iron Conversions" part of the blog post, I was flabbergasted that you'd pivot towards an aspect of the business that you were apparently not good at. What you said about Iron Conversions was vague enough to leave some doubt, but it sure read like "My product failed, partly because I can't convert customers to save my life. I know, I'll start a new business helping people with conversions!" Put this way, it sounds like a pretty delusional plan, unless you learned something magical about conversions that for unknown reasons you just don't feel like applying to your existing business. Hope that doesn't sound too harsh.

Good luck on phase 2.

[Rakathos]

Not harsh at all! You're right, but in my defense "Iron Conversions" was just going to be a massive dunning email generator. It would have hooked into a user's Stripe account and responded to webhooks with A/B tested dunning emails. The onus would have been on the user to convert their trials.

[danso]

Thanks for sharing. I'm interested in knowing why you think it's worth doubling down?

Besides the lessons you've learned, did you see an actual opening in this market, or is your motivation mostly that you think you know much more than you did a year ago? Because while that may be the case, that doesn't mean that the conditions are right for your app to succeed. From an outsider's perspective (I know as much about inventory management as you used to -- just about nothing)...it seems very hard to get people to switch from whatever legacy products they were using before...it's not just quality of competing product, it's the cost from escaping the inertia of legacy frameworks.

[Rakathos]

> I'm interested in knowing why you think it's worth doubling down?

There's a bunch of reasons for me to try it again. The most persuasive one has been all of the great feedback I've received from trial users, people on my mailing lists and interested HNers telling me that it just needs a little bit more to be a viable product. "A bit more" in this context is stuff like accounting or order management, which I was really resistant to before as it went against the "grand vision" I had for my product.

And if I fail again, it will at least serve as a guide on "what not to do" for everybody that has been following along. I won't be any worse off financially; I'm not risking my job or income beyond the $50 I spend on AdWords each month. That being said, I'm still highly, highly motivated to succeed.

> Besides the lessons you've learned, did you see an actual opening in this market

There's a big gap in the "ERP for printing companies" market. The only big name in this area (which I won't mention for fear of legal reasons) puts out a terrible product. It fails so often, and it's so darn complicated for Regular Joe Employee to use that it's a wonder this company has any sales at all. I'm often the person that gets called in to fix the problems it causes at my own company, much to my dismay.

You're right about people switching from legacy products though, and that's definitely an area I'll need to gather more information about when I start customer development in the next few weeks.

> or is your motivation mostly that you think you know much more than you did a year ago?

I feel like I know a lot more now than I did before, but I'll never know it all. For example, I know that customer development and marketing is way, way more important than any code I'll ever right. In fact, that's why I'm not writing a single line of code beyond my MVP until I get some real customer development and feedback.

[yogo]

I don't think your budget is big enough for a successful AdWords campaign. In fact, I think at $2 max a day you're probably just throwing that money away. My guess (I don't have much details here) would be that you're looking at 1 or 2 clicks a day and that's pure luck if any of them convert. Given that constraint I would avoid AdWords altogether at this stage. I'd bet that a cheap, but quality, mailing list containing businesses that might need your product would produce a better return.

[pbreit]

That "terrible" product has more users than you ever will becuse it's makers understand that sales and marketing are far more important (and the product is not as bad as you think).

[Rakathos]

If there's one thing I've learned from Rob Walling and Mike Taber's podcasts[1], it's that marketing and customer development are by far the most important parts of building a successful SaaS business.

> the product is not as bad as you think

This is true. I know that I'm a developer, and as such I can easily see the mistakes that my competitor has made. Meanwhile, the average user just thinks it's a run-of-the-mill program, put on this earth to torment them like any other software.

[1]http://www.startupsfortherestofus.com/