Everyone knows that building a software product business is different from building a software services business. It takes a different kind of entrepreneur and a different kind of team to build successful product software, what I like to call the product software DNA. In recent a series of 4 posts on our company blog, I had shared my personal take on four key traits that I think are essential for building a successful product software company.
#1 – A Junoon
‘Junoon’ is a beautiful Urdu word that most aptly defines the kind of passion one needs to have to be start and build a product software company.
Building a software product starts with an idea that quickly grips the founder, it becomes a passion that borders on the fanatical. If you can be persuaded to do something different, you are not yet smitten!
The passion of the founder selling the vision of product idea is really what the first set of customers and the first investors buy. It’s what attracts other to give up the comfort of secure jobs and careers and join the start-up team.
99% of product software business fail to realise their founder’s dreams. If you know this and yet you set down this path, you can be sure of one thing – times will be tough and there will be more bad days than good ones. Each such day, it is this all consuming passion that keeps you going. It’s what keeps you trying yet again. It’s what will bring you back to work each morning. Read the full post here.
#2 – Imagination
Building a product software business is more like driving while looking far ahead ahead (almost beyond the visible road) rather than always checking in the rear view mirror.
Not only do these entrepreneurs see a different picture, they are convinced that’s what it’s going to be and they just know that it’s waiting for them to make it happen. Almost anyone can describe today, but some can predict what tomorrow will be like. The latter is what the world calls visionaries. Founders who make tomorrow happen are sometimes visionaries but more often they are the ones who know how today will transform to tomorrow.
Contrary to popular belief, you believe that customer’s don’t know what they want. Henry Ford once said, If I had asked people what they wanted, they would have said, faster horses.
Read the full post here.
A successful business, one which earns a surplus and generates cash, does not really require doing any one thing alone or at least not always. As long as you can identify opportunities as they present themselves and capitalise on them you will get there. But that is just the kind of outlook that will not help you build a successful product software business.
Building a software product is a journey where you must know where you are going and at each turn and fork in the road, you will need to choose the road will get you there. More often than not, you will not know the right road but you will be able to see which one is not going to get you there.
As a product software business founder you will go out and meet prospective customers often with needs your product does not meet. You will need to decide whether these will add value to your product as you had envisaged or are you talking to someone for whom your product was not meant in the first place.
At EmployWise, we have a very active customer community from whom we now source most of our new feature ideas. And yet we often say no to suggestions that, for example, will defeat the philosophy of employee self-service which is at the core of EmployWise.
The same razor sharp focus on what you want your product to be is really how you create simple products that intended customers love to use. Keeping products simple and easy to use doesn’t happen till you have the ability to focus and stay focussed and say no when you must.
In our own experience and from conversations with many others I have heard countless arguments and justifications on why in the short term it makes sense to do things that have nothing to do with building the product with we need to do this to pay the bills being the most common. Yet the reality is that it takes you and your team away from what you set out to do in the first place.
On the long hard journey that building a product software business is, there are many diversions and distractions that you just have to say no to and keep to your path. Do you have courage to say no and stick to your vision?
Read the full post here.
#4 Don’t Chase the Money
I can think of none among those who built successful software products who got into the business with the sole objective of making loads of money. It is ironical that the very guys who didn’t care so much about making money made gazillions of the stuff.
Just to set the record straight, I am not saying these people don’t enjoy the having and spending the money they made. But the point I make is that making that kind of money is not why they did what they did in the first place. In fact almost none of them would have ever imagined they would make so much money.
Try and figure the way entrepreneurs who built successful product software companies lived and how much they spent on themselves while they were building their companies. My guess is that you will find that they needed very little to get by and I suspect the key reason for that is that they spent most of their time building their products and their companies.
The harsh financial reality of the product software business model is that entrepreneurs who thought that will be cash positive in X months/years very soon realise that it’s a shifting goal post. The earn-burn equation keeps changing but stays negative far longer than planned. Even with initial success and fancy VC valuations there is really very little cash for the founders to take home and spend on themselves because a fast growing business sucks in all the cash there is.
So if you are thinking of building a software product business mostly because you want to be the next guy who company gets bought for billions of dollars, I hope you will pause and think again.
Read the full post here.
Look forward to hearing what you think and what other traits you think I missed out.