Ask HN: Should I make a lower cost replica of niche software? | Hacker News Reader

Ask HN: Should I make a lower cost replica of niche software?

25 points93po17 comments

I've recently been looking into making some software for small to medium sized businesses and someone I know mentioned how there's software used for a part of the real estate world where there's only a single big player and they're quite expensive.

I am hesitant to build software that already exists because it seems sort of pointless in the grand scheme of the universe. And it seems like a tough spot to compete only on price. But it does seem like a pretty safe bet for making some income and the scope of the project is feasible for a single developer over some months.

Any advice or opinions appreciated.

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I don't know if you have just taken a cursory look or you have actually used the software that you're going to compete against. My advice would be just to find someone who is using the other software that would love to work with you in making something that is competitive. That way you can get some continuing advice on the details. having done similar to what you're describing, it is usually the details that can take up the most time. It's easy to get the basics shell up and running but the details can increase the time and cost more than you expected in the beginning.

> It's easy to get the basics shell up and running but the details can increase the time and cost more than you expected in the beginning.

Yes, and I think this is particularly true in the real estate world. It's ripe for disruption in many ways, but there also seem to be a lot of domain- and region-specific issues to work through.

I am not too familiar with the real estate world, I've just been through the process of buying and selling a home a couple times, and I've read a few articles about the role of realtors and realty software in the process.

> I am hesitant to build software that already exists because it seems sort of pointless in the grand scheme of the universe

It's unlikely what you build will be identical unless you intend to make an exact copy. You really should target a niche that is being ignored and have something that differentiates your software from existing competitors.

That said, I don't think competing on cost as your only difference is a good idea at all. If your software is solving a real business problem that brings in big income, why would a business care about saving a (relatively) small amount of money? If you become popular, could the big player wipe you out by offering a cheaper price tier? Is price going to be enough to make businesses take a risk of moving away from the established player? Will your low cost make paid advertising infeasible?

Also, don't underestimate the difference in the time it takes to build a quick prototype that mostly works, and building something robust + user friendly that people will be willing to pay money for.

It could be that the price of the software reflects the effort that goes into the sales cycle, or ongoing support. Say you can hack together a competing product in a few months. You still have to go out and win over customers from the 800lb gorilla. That may be harder than you realize. They may also value a more expensive product more than a cheaper one.

Larger companies also have economy of scale - they can hire product managers, have a constant recruitment funnel for support, have a proper sales process, etc.

Marketing costs can be significant - I often see sales/marketing take up about 30%-50% of the final price of software.

Competing in situations like that can be a lot of fun, and if the market opportunity is actually good then you could make quite a few dollars in the process. I agree with byoung2 though... you need to consider the sales process. I would recommend seeing if you can get someone to pay you to build it.

Depends on the niche, but a decade ago I remember talking to someone who worked on TopProducer, which is a Canadian-made business management software suite for RE agents.

It was an absolute junk by this dev's own assessment. Slow, bloated, buggy. Development was disorganized and perpetually behind the schedule. It was also really expensive, but it endured because the industry is really conservative (they like their crappy tools regardless) and the vendor lock-in is a major factor. Lots of hidden complexity too, including the nuances of business flow.

Don't know what niche you have in mind, but do talk to the target clients before making a decision. You may discover that they don't really see a problem where you see one, nor that they are excited to see it fixed and pay you for that privilege.

The important thing is talk to your customers. The people using your tools aren't necessarily your customers. They may hate it, but the purchaser is in another department and doesn't care. Large organizations often by subpar tools without listening to their own engineers, and you will have a hard time convincing someone who doesn't have any issues but makes the decision to buy.

This. I did consulting for a while and sales people don't seem to understand the amount of time, money and effort it costs to switch software suites. Sure, your product does x better and is cheaper, but the current suite is painstakingly shaped to match our needs over the years. To recreate the same situation in a new software suite will take 6-12 months (while running the outgoing suite as well since business has to continue as usual), meaning double workload on the staff involved. And don't even get me started on teaching Jen from accounting how to use the new software because the old software was 'running just fine' and 'she's been using it for decades'...

To most organizations, the cost of a software suite is a factor when they're in the market for something new. But when you're offering an alternative to something they're already using the price isn't really a factor.

We were recently asked by a client to build a relatively simple feature - wouldn’t have taken us more than a week.

After taking a deeper look at existing services we noted they were all surprisingly expensive - and in the same bracket.

Turned out access to a particular API and ensuring the process and output of the service would be legally inadmissible were the real cost, and we actually wouldn’t be able to compete with the existing services.

Not saying don’t go for it, just make sure you understand that the cost may not be the problem on the surface.

Why not? But do your research first on why there is only one big player and why it's expensive. Especially if the problem looks somehow simple. Check if there are legal requirements, uptime or support promises and so on. Just an example; you may need to compensate a client couple of millions every so often because of some wrong calculation or a 15 mins downtime in some industries.

If the problem is big enough, cost isn't a problem. You'll also find that the cheaper clients/users are much worse. In fact, a lot of people even raise prices to cut down on user support and "fire" some troublesome customers.

It's probably easier to do higher quality replicas of niche software as a lot of them are poorly done.

How niche? What's the total market size? Whether or not you can make some income is one question... But can you make an income you'll be really happy with? Will you be able to hire a replacement for yourself if you want to go do something different? What's the best case scenario?

There is a number of companies that make what's called 'app-scripts'.

One is appdupe.com there are a couple of others.

Basically they take X-like-Y business ideas that demonstrated, nominally, their worth (in either solving a business problem, or attracting investors).

And they just duplicate those models -- uber-like, tinder-like, etsy/ebay-like, and so on.

They generate the source for apps, backend services, etc --- you just give them your twitter handle, name, logo, contact, fb page... whatever.

I also read when researching this, that some of them produce 50 apps per week.

Apparently, again 3rd hand info, that their services start at 10K usd and go up from there....

I have no idea about the quality, may be bad and may be they they will end up charging 10 times more what you though initially...

So imaging that people are not shy of duplicating a business idea and just applying perhaps to something else, or just a different geographical region....

It is definitely not pointless building software that already exists.

I would say go for it...

Either of 3 things will happen

a) you are successful and completion fails

b) they are successful and you fail

c) you are both successful

in all 3 scenarios -- end users seem to be benefit.

If it's a big market, there's enough money to go around to support multiple products.

When Google was introduced, the search engine market was packed.

Yes. If you do not, someone else will, and you will regret it.

In the end, where are you adding value for your end user's lives?

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