Patio11's Law: The software economy is bigger than you think
secondbreakfast.co
secondbreakfast.co
Here was an entire market segment I'd never heard of, and just the market leader is worth $163B. And on top of that, the technology is so totally alien to anything I'd ever heard of before. It's like an alternate-history kind of thing. Like if we discovered a continent somewhere in the Pacific that had never been in contact with our civilization and had steam-powered airships or some crap.
And I'm sure this is just one of many such industries, even just within the umbrella of software.
At the same time, I guess you have to be at a company of a certain size for it to be relevant to your life... But that perhaps proves the point - HN is very starup focused, and occasionally in a bit of a bubble (which is fine - I come here to get away from my daily mainstream IT grind and see excited people talk about cool things:), yet a hundred reasonably successful startups won't employ or touch near as many people as a single "quietly" successful traditional behemoth.
"Implementing ERP isn’t just a purchasing decision: it’s committing to redoing how you handle operations. Installing the software is the easy part; adjusting the whole company’s workflow is the most of the work."
Don't think of erp and implementing it as a software development challenge. Sure, Developers can fscrew up*, an erp implementation but they cannot make it succeed - it is fundamentally a business transformation endeavour and must be undertaken as such to have a chance.
Part of me wonders if these things are more of a "no one ever got fired for buying IBM" thing than anything else. Are people buying the workflow because it's what they really need, or are they buying it because everyone else uses it?
If you're selling widgets, and selling 100 units a month, there are growing pains on the path to 100 units a day and 100 units a minute that you can't anticipate, and that billion-dollar retailers have already figured out. So I think to the extent that physical B2C sales is pretty constant across industries, you know that if you're big enough to justify the investment in SAP or a similar ERP platform, there exists a process that you'll need 0.5, 1, or 5 years from now that they have and you can't really articulate today.
2. HR, Finance, all the backoffice stuff - that's not your competitive advantage. It's not your core business. You just want to do it as efficiently and quietly as possible.
3. Therefore, in ideal case, a company realizes it is not a special snowflake, buys an ERP, implements it as vanilla as possible, and quietly goes on focusing on what IS their competitive advantage / core business... rather than spending years, millions of dollars, and tremendous risk, by trying to customize ERP to some obscure different process they just "must" have :-/
however, not once have I ever heard of an SAP implementation going well. It's a massive undertaking and takes total commitment from so many different people and roles in an enterprise. You need genius PMs and BAs along with a genius client team before you even talk about the actual technical people.
Sometimes it depends who you ask; I found that hands-on people on the ground and SMEs tend to be very negative about it, for personally valid reasons - it's a lot of work, it doesn't go smoothly, and it disrupts and changes what and how they do it.
However, there are quite a few ERP implementations where the top-level stakeholders feel the results are worthwhile the disruption and pain, and from that perspective it "went well" - the business objectives were overall met, whether it be capabilities or speed or reporting or integration/centralization or headcount or complexity reduction, all of it ultimately boiling to money at some level...
Only the top-level stakeholders felt the results were worthwhile the disruption and pain -- that they did not suffer.
But have you ever heard of one going well ?
As in, not just worthwhile to a tiny minority of the people on the top?
Yeah I bet it makes stuff more efficient, but clearly there's a disparity between the people suffering "disruptions and pain" and the ones who ultimately feel it has been worthwhile.
And maybe, just maybe, what is right for the business is bad for the majority of the staff. At least in the short term. I know that is a bitter pill to swallow, but it is reality.
Perhaps an example more palatable on HN would be Uber replacing all its drivers with software. Clearly better for the business.
The same with the parent commenter's thoughts, "Sure, developers can screw up [business transformation projects], but they cannot make them succeed."
- From the ERP end: you want it to be as flexible as possible so that it can reflect how the business actually operates and should operate in the future
- From the organization's end: you want to identify not only how the business currently operates, but how you would want it to operate in an ideal world
Well, management did. Every other phrase they uttered was "The old system did it this way" or "I used to just press F2". The pushback to learning something new was unreal.
Nevermind the fact that multi-step processes were reduced to a simple button click. Or that inventory and customer management were orders of magnitude better. The old system!! The old system did it another way!
More generally, a good way to botch a business transformation project is to select technical solutions without a keen grasp of how they fit your business need, and to bullheadedly stick with those solutions as friction is revealed with the business needs.
Both distorting the business around vendor software and ending up continuously fighting with the vendor software throughout th effort (both of which are commonly cited “how to fail” routes) are clear (though superficially opposite) symptoms of that same failure occurring upstream in the process.
That’s pretty dismissive. I work at a company with ~80B in revenue, I never interacted or heard of SAP in work context. In fact it is only incidentally that I’ve heard of them previously. There are hundred of thousands of engineers working in companies with 10-11 digit capitalizations that will never interact or hear about SAP.
Edit: to clarify because I am getting a bunch of downvotes. My point is not about SAP’s penetration, it is that lots of engineers (even in companies that use SAP) might not encounter SAP products. The perspective “of you haven’t worked with SAP you are in a small org” is wrong.
https://www.erpsoftwareblog.com/2012/11/why-does-microsoft-h...
What would be the point of Google writing their own financial consolidation software?
I.e. HR & Payroll legislative rules and best practices, business & organizational process transformation etc, are not what Google Engineers and IT necessarily have experience in, and if they allow hubris to override that fact, it might not go great.
Internets indicate that Google uses Oracle, Apple uses SAP.
This info may be outdated - for example, Facebook claims they built their own ERP just recently; I do wonder what that "backend database" part is though, or how much HR/Pay/Finance, as opposed to inventory/datacentre management, is custom: https://techcrunch.com/2019/08/15/how-facebook-does-it/
Since you are in the machine learning silo, your perspective may be a little skewed.
It would not surprise me if KP were using ECC for their finances or some other area the parent comment is not familiar with.
The fact that you are arguing against this might be why you are getting downvoted. The original comment was saying “if you are in a small org you probably haven’t worked with SAP”, which is not the same thing.
Edit for further clarification: I can see how it might look like they were arguing what you stated, but it was more of a Bayesian inference. Many HN readers are at a small company, therefore a plausible reason that an arbitrary HN reader might not have heard of SAP would be that they are in the large pool of HN readers that are {in small companies and, therefore, do not work with SAP}
You're either using SAP and you don't know it or you're using Oracle.
EDIT: just looked at your linkedin profile. I can see that your company literally has SAP consultants working for them full time. I don't know which SAP products you are using but you definitely are an SAP customer.
Or you're using NetSuite (which nowadays is Oracle, granted, but a rather different product from what most people think of when they talk about Oracle or SAP in an ERP context), or you're using Microsoft's ERP (Dynamics something or other? Never used it), or you're using something developed in-house (very likely running on an AS/400). Or hell, you might be running multiple ERPs in a weird limbo state mid-transition (e.g. Thermo Fisher, which was using AS/400 and SAP (or maybe it was Manhattan? Or both? My memory's fuzzy...) - the latter of which might very well have been partially implemented on AS/400 in order to integrate with the existing ERP - as of a couple years ago when I was working for them).
It's worth noting, too, that there are plenty of large and arguably-dysfunctional companies not using an ERP at all, or (like with my current employer) it's relegated to very specific uses because other functionality got offloaded to other systems (for example, it's relatively common to run a WMS separate from the ERP and integrate between the two, as it is with an eCommerce system; in my employer's case, all three are separate).
I would fully agree with that, my generalization was kind of the opposite - if you work at a small company you are unlikely to use or work with SAP.
My other generalization was that HN was focused on startups, their technical culture, the cool and interesting, and almost by the definition not on boring bread and butter aspects. Does not mean that people/users themselves do not work there - I have spent twenty years on PeopleSoft/Oracle myself, but that is not why i come here and yes, the overall zeitgeist on HN toward e.g. Oracle is pretty consistent :->
FWIW, comment was not meant to be dismissive. I was genuinely fascinated, late at the night, at the notion that IT industry professionals might not be exposed to a behemoth such as SAP or even ERPs at large, and was pondering as to how that might come to be; there's absolutely personal bias & hubris in it, which is why I tried to understand where it came from and what's the diff between background of my friends and colleagues, vs perhaps some other IT professionals :)
I had actually heard the name SAP come up in passing at my last company, who had lots of ginormous clients. But all I'd really gathered before reading the article was "it's some kind of database, or something".
When was this? Leo Apotheker became CEO of HP in 2010, after 22 years at SAP (two as CEO). He then presided over a sequence of colossal fuck-ups, lost 40% market cap, and was fired less than a year later.
HP definitely knows about SAP, but I wouldn't be surprised if they're not big fans.
Correction: 22 years at SAP, not as CEO.
Not to say he wasn't bad at it (I honestly don't know) but it's a hard job to get right.
I'm not sure about his SAP earnings, but he sold HP an 11 month CEO for upwards of 27.5M[0]. That sounds like the perfect way to end your sales career ;-)
[0]https://www.nytimes.com/2011/10/01/business/lets-stop-reward...
Is SAP something that can be somehow scaled down? if this is used for a beer store, it has to be really large store, if that's what is written in the cited article is true:
"A basic installation of SAP has 20,000 database tables, 3,000 of which are configuration tables. In those tables, there are ~8,000 configuration decisions you need before even getting started. And that’s why SAP Configuration Specialist is an actual job title!"
You are absolutely right, a single retail store would not use such an ERP :)
Let me guess, you live in Toronto?
good thing we have SAP to facilitate the development of large scale business, such as monopolies and cartels.
https://www.acclimation.com/au/solutions/sap-bydesign-vs-bus...
SAP is/was virulent in nature. If you used it for one thing it damn near forced you to use it for everything. A significant chunk of the work EDS were undertaking (as IT outsource) was migrating to SAP.
Our timesheets, project plans, data, hell even a huge chunk of our app development was done in SAP. We were paying through the nose for SAP contractors too.
Software for software developers can be a huge focus here, but it's just scratching the surface of software for the rest of the world. I was startled when I applied for a job at a company in my city, and they told me their product was entirely API connectors for the local banks. In fact all of the companies I've worked for here have been making software for local industries! From solar installers, energy efficient lighting manufacturers, local commerce and POS systems, mechanics software, creative market places, local lead generation.
I think if you want to start a business from scratch and you're not in SV, it's worth targeting those problems instead of problems that SV/startups have. You might not get sexy VC capital, but you might be able to jumpstart with some clients up front.
Open source tries to make great software. Does the best job.
The one unicorn I worked for had so much cash to spend, there were at least 3 teams of 8-10 engineers on the same floor trying to solve similar business and infrastructure problems with different combinations of open source software.
At Accenture, for example, there were projects where 30-40 full time consultants were flown in from all over the country to do big SAP implementations.
...so you could see how Systems Integration partners heavily sold SAP products.
(As an aside — when we started Retool, we ourselves didn't expect the "custom internal tools" to be such a big market. As it turns out, we now have customers that spend $400M+ / year on building custom, homegrown, internal tools! While we [or any single vendor] certainly can't capture all of it, our goal is to capture some percent of it.)
I can only imagine that if you create any tool worth competing with SAP, your customers also have to be huge companies.
We lost some customers to SAP later on because they become bigger and "consultants" told them that they should switch to SAP because, you know, all big companies use SAP. I haven't heard of any success stories from those customers yet (this is not entirely SAP's fault though).
Almost certainly most operations accounts and tax filings could be fully auto generated from their bookkeeping - if the bookkeeping was good enough.
You could do that by constraining the bookkeeping and adding some intelligence to the reporting.
So why do bookkeeping firms like Xero stop at basic bookkeeping? Because they sell via accountants - who make a lot of money piping data from one computer system into another to change the format a bit.
Enabling certain people to maintain their mystique is lower hanging fruit than pushing for full automation.
Plus who wants to program accounts systems...
For complex accounting and analysis you still need accountants and business analysts. It's a different type of job in that case though: instead of handling the common cases, you handle the edge cases that the software is unable to deal with.
I firmly disagree. I am supposed to be reviewing accounts right now....accruals, prepayments, deferred income, the difference between capital and expense, capital allowances, R&D allowances, dividends vs salaries, consolidation of groups. The average bookkeeper is not expected to work at this level. That all requires judgement and experience and expertise. That is why Xero stop at the easy bit
This is such a typical dismissive reaction by a person who has ZERO insights into the domain.
If it is so trivial, why don't you do it and disrupt the market? Some very trivial millions are waiting for you to just come and get them, what's holding you back?
Half of it is just the business & people skills to extract the necessary information. Harder than you'd think, and that's just asking people for stuff!
I had to work in the store for a month and got good feed back from the workers there.
We try the smooth the user experience with web apps for tasks that are done often so it's not to confusing.
But the impotent data entry task like order entry and so on are done the old interface because it's more efficient.
It's not that it couldn't be done, but it's very much a moon shot and it's not going to happen without someone charismatic and experienced driving it and selling it.
Specific niche feature SAP-a-likes are more plausible on a smaller scale, but sales and marketing will always be the real challenge.
Its all the new fangled dumbed-down, web-ui's that is sheer crap and leaves your head scratching.
Well..the old UI's were coded by old-school, C programmers who started their career in the 70s and 80s. They even wrote a multi-process Erlang style kernel to back the application programming. Performance came naturally from their gut.
Nowadays, we get Electron and congratulate ourselves.
But almost no one is fast with a mouse based GUI
Indeed.
Which is exactly what SFDC, NetSuite, etc have done. There's definitely room here.
edit Got a lot of vote downs. This was a genuine question from someone completely ignorant on what ERP is. Not trying to say that SQL is better, but I'm asking this because I'm ignorant of what ERP is and the description makes it appear as if it's a database.
What's the difference? would be better wording I guess.
SQL doesn't.
Would it be equivalent to contracting some software system to a a company that would build the system using SQL?
My real job many days is helping devs make peace with our various web proxies - even the special, relatively open, non-SSL-intercepting “dev proxy” requires CNTLM, which just celebrated its eighth anniversary on its current build. And of course, my little darlings take dependencies on it for things for which the masses absolutely not have access to it.
[I finally got around to making an account after lurking for so long. Your post was the catalyst ]
We've slowly stitched together an assortment of SaaS tools, custom built modules, and Excel files in the exact way I swore we would never do. If anyone's been through this hell before, I would appreciate some help.
* Quick books
* Sage
* Dynamics / NetSuite
* JD Edwards / Infor / Manhattan
* Workday
* Oracle EBS / SAP
Each of those on the same line are similar in features and complexity.
This is obviously not a complete list - just the ones I have dealt with.
But this doesn't happen until your team (accounting/finance/CEO/CFO) start running into roadblocks in either piecing together financial statements, or the month close process starts taking weeks of manual labor, or there's a HUGE accounting issue and everyone discovers the forecast is way off and the company has been burning cash faster than expected.
At this point you have the organizational momentum to do the crazy amount of work required in getting an ERP up and running, which requires getting most of your business flowing into it so that it'll even be remotely useful (otherwise everyone goes back to Excel).
What needs to flow into it? Everything you're doing by hand to update your three sheets. You need to get revenue/income in there (sales orders, purchase orders etc.), product costs if you have them, payroll, bills (internet, office supplies). Hopefully you use something like Bill.com, and this becomes a (slightly) simpler process.
Maybe you have vendors in Europe where you pay in Euro, so you now also have to figure out how you're going to convert currencies. Maybe you have warranty on your products, so you have to balance accrual accounts. This list goes on, and on, and on.
Every company is different, and you might not even recognize the overlap between two ERP launches besides the fact that they're using SAP.
I think that very much depends on what market you are in. Sure if you are a Saas, but not if you are a European distributor with stock in two countries with different currencies. Stock adds massive complexity. You might be reaching for a lower end ERP at $5m of turnover.
Friends who had businesses in both Poland and Singapore tell me that the difference was like night and day.
You usually reach in inflection point where your manual process sans-ERP is costing the company real money, and the ability to make quick(er) decisions is hampered by your current process.
He told me companies would buy top-of-the-line (overpriced) hardware and pay a premium to get SAP up and running, because they would plug their company into it and recoup their costs almost overnight. It would just do say currency conversions or other super-boring non-core-business things better and save a pile of cash.
You can't save yourself rich, but sometimes the difference between a profitable quarter and a horrendous loss might be your accounting software or your tax software...
- understands technology, but is not a big fan of it
- can communicate with clients
- can handle stress well
- is into salary maximization
> basic installation of SAP has 20,000 database tables, 3,000 of which are configuration tables. In those tables, there are ~8,000 configuration decisions you need before even getting started
Wow, this is nuts. 20,000 database tables?
Highly customised, to the point that upgrades are impossible.
Extremely complex systems. So complex that vendor lock in is assured, and the lock in means big prices.
And yet a good business because ERP systems are at the core of any medium to big business.
It's grindy, boring, challenging without being fun work, often using non standard technologies that have been developed by the ERP systems vendor, which help ensure lock in.
ERP companies like SAP and Oracle are the absolute best at making money on services - they know how to charge huge huge amounts and get away with it. There's TONS of money there.
I wouldn't want to work in that area though.
Having worked in food industry as IT about 20y ago, we used to have fragmented system portfolio, and were struggling to pull data from one system to another. The around 2002 management decided to switch to SAP. I remember working on the storage/capacity/CPU aspect of it (and mid-migration I left the company and completely missed on the SAP train in my career). That food company was providing milk, yogurt, cheese, juice, ice-cream to about 25mil people (customer base). That's SAP for you right there. So that 78% doesn't surprise me at all. I believe the remaining 23% is too small to invest that amount of $$$ nad just hasn't done it yet.
When you get the ability to "track every cucumber" from pick to sell, cut down on fraud, errors, be able to calculate every bit of profit, loss, why would you go anywhere else? I understand the initial cost may be hefty, but once you set it up (good and well), you can stop focusing on that, and see how to grow the business parts of your business, and not the admin.
But because it is so massive, it's impossible to find talent that can actually implement it properly. That's IF your company doesn't require a ridiculous amount of customization.
Projects always run over-budget and over-time. Vendor lock-in becomes a huge problem. These companies solely exist to keep customers using their software and paying their service fees. They then provide just enough marketing buzzwords to justify it to execs who justify it to other execs.
If SAP is done right, it is very powerful, but it is seldom done right.
I mean, some of these behemoths (or used-to-be behemoths) of technology, like Oracle and Intel and Microsoft (Ok - everyone knows them) and Dell and Apple (mostly the 2nd one) and places like SAP (which is arguably the biggest database and logistics and supply chain (sans the EDI middle-ware vendors on the planet) and Synnix (which is arguably the largest ODM supplier of white label servers to the largest data centers in the world), and, well, Wistron? BBG? (Submarine - https://www.visualcapitalist.com/submarine-cables/) Satellites? Aerospace? What it takes to wire our world together?
This is not a criticism - it is simply curiousity - as a tech person - you don't read up on (or do you think people do or do not read up on?) the way the world works technologically?
My son graduated with an engineering degree recently and his friends always want me to take them to lunch (free food!), but also so I can tell them how the world is connected (power, telecom, SDN, Satellites (launch - cradle-to-grave), and I'm always a little amazed because I grew up libraries of books and they've got google, but want to be lectured?
I guess I don't understand. If you have a moment, could you edumacate me?
Now, that's a little unfair because I read really fast.
But - I guess I was just curious about how a tech person couldn't know about SAP.
NOT as a criticism, btw -- just I don't know how this could be? They are not a secret company. I just (apparently) don't know how young software engineers are wired? (Yeah yeah - Ok boomer, I get it)
But, because people actually do matter to me - I would like to understand better how they are wired...
EDIT: I am also stimulated by my healthcare projects and my energy projects and my stupid stupid project to build a carbon-nanotube elevator to the sky (which may have more funding than practical deliverables!), but I am completely stimulated. I assumed you were too, so it wasn't intended to be an either/or.
EDIT2: If you don't know the answer to the question I was asking, don't worry about it. Nobody else appears to know either. Just because I have a question doesn't mean that there is an answer. Thank you for engaging and have a good night.
"We" were going to build a new world. So I guess we were some kind of idiots. After I sold my first "game" on an Apple 2 in 1984 (they paid me a lot), I went to work a semiconductor manufacture, and AT&T and Apple and General Magic and Motorola were going to re-invent the world. Good engineering work - bad vision. Didn't work.
Meanwhile in Japan, where I worked, I translated Nintendo Games (In addition to the adobe and lucas arts stuff, which was more for Sega) to the 6502 (hey, I'm old), and made money trying to make the meet the new.
I think it was easier back then. I think there was less intergenerational hostility.
Why do we have inter-generational hostility? I know how to bring the old arcades alive! :-) (Actually I know how to activate satellites - if we want low-cost back-haul - packets here - packets there - There are 0.1% utilized GPRS networks out there.
AND Now we are getting into topics that you don't want to hear about.
I do really appreciate your willingness to share tonight. You broke open a couple of pre-conceptions. And I guess that's the reason you talk to people.
Thank you.
But for me, I just find my self researching all sorts of things that aren’t even related to my job. From aviation to renewable energy to database systems to carrier network hardware to finance and economics to chemical process engineering, etc. I just find myself almost infinitely curious, and meet others like that occasionally but it doesn’t seem to be how most people are wired. I don’t think it needs to be the norm to be for most jobs, but I find it’s a huge advantage for the kind of higher level product architect/systems engineering roles I’m doing more of.
In some ways it’s detrimental - I find it really difficult to keep motivated to do the deeper-level nitty-gritty engineering tasks because I’m always more interested in everything going on at a higher level in our products, so when involved in hiring I don’t try and select for people like me. I think tech companies need some but also people who are happy to focus on deeper-level work.
Message me after. I am at wmarchibald@gmail.com
EDIT: Oh! Also "Eat People" by same author - Kessler : https://www.amazon.com/dp/B0049U4KC6/
Semi-edited: Everybody else will say Zero to whatever, and the Hard things about Hard Things, and Jimmie's book Good to Great and Crossing the Chasm, and you might call me mad (and I may be!), I am the only person who will recommend a book called "Eat People". (It is a good book, though)
EDIT2: U - akjha - Please let me know what you thought. You have my email address.
Your son and his friends know you. Your experience is lived, and real, as real as you sitting next to them. Reading books is abstract, the language can be obscure, archaic, verbose, flowery, dense, etc. Your son and friends know how to read your emotions and communicate effectively with you. An hour of your stories could likely replace dozens to hundreds of hours of reading because you can tailor your stories on fly the in a way no author ever can.
EDIT: I think your learning style and mine are much different. I remember when I had to do a biological proposal to DARPA (I guess I didn't have to), I went to the University of Texas bookstore and got every book they had on molecular biology - and read them over two days at a Starbucks on the deck (beautiful day, but hot), and then wrote the proposal and had the interview. (I'm an EE,CS and Physics guy who knows jack-shit about molecular biology). I never figured I ever had time to talk to anybody as long as I had 30 vertical centimeters of books on the floor that had to be processed by dawn. Maybe it's a generational thing. Maybe I'm just broken.
SAP is known for incredibly long ongoing projects and Deutsche Telekom has a track record of destroying acquired online businesses. I would bet 10:1, that this project will fail.
But, isn't that software almost the reason why computers and databases and programming happened? To help businesses with there boring business stuff, like inventory and orders and accounting?
And those don't use $LATEST_TECH, $FANCY_FRAMEWORK or $EXOTIC_LANGUAGE.
They use $BORING_TECH, $OLD_LANGUAGE, $DEPRECATED_FRAMEWORK.
They are not in the cloud, don't update often, have to deal with legacy stacks, stacked on a stack of legacy stacks, and administrative burden from left to right.
Those are the ones that pay for an Oracle licence, and sync it to dozens of excel sheets from an FTP and a lone Access DB, where all auth is manage by a Tomcat service actually proxying to Active Directory and their custom CRM.
And they certainly don't have a team of 10x programmers. In fact, most are windows dev that never used the terminals and don't have admin rights on their machine.
I should know, I make half of my income going from company to company to train their team.
They are everywhere.
They make billions.
This is insane. If it's hard for a company like Microsoft to move away from SAP and shift to their own solution (hence saving face in addition to the $$$), I can't imagine anyone switches software in the ERP world
The work was exceedingly boring. But they had excellent lunch. Better than most Google offices.
That's pretty wild, like not knowing who Microsoft or IBM are.
What's special about the software economy is that people who write the software take home a large fraction of it. Maybe more than half, depending how you count. Which is unprecedented.
It's not just because software can be zero marginal cost. Musicians don't take home half of music revenue. In most creative industries, the creatives take home less than 1/10th.
Enjoy it while it lasts.
I sometimes wonder how many decisions I make per day that an AI could replicate in some repeatable way. Who knows, but nothing lasts forever.
We seem to be subconsciously precocious about our fate too, as we deprecate things at a faster and faster rate.
I disagree, developer work will be automated as soon as it is technologically feasible, especially given the high cost of software development labor. I foresee AI software development platforms starting to take over new application development at some point, building applications that humans have minimal access to the source of. Existing apps by humans will likely need human maintenance until AI is able to reason about larger legacy applications.
We’re already starting to see no-code apps taking off, and AI will drive the proliferation of that technology as it becomes more sophisticated.
I have this book from 1880 about steam locomotives, where the preface talks about how all the most ambitious people are going into steam engineering. Which they were, for a while.
The answer might be, until something better comes along.
A traditional mindset applied to software results in the businesses we often see people complaining about. "We make the product but Sales gets all the money!" and that's very similar to your metallurgists. Code for hire as a product of labour. It takes an army of people to sell, to advertise, to make me want what it is you have (just like with music).
But a business who looks at software as complementary will see the value. A dollar spent brings many dollars back, just indirectly. It enhances the machinery that's already in place, and allows it to do entirely new things.
Where do you get that figure? The vast majority of people writing software are not paid enough salary + benefits to come anywhere close to 50% of the revenue their work is responsible for earning.
That’s the total expense, right? Not just employee remuneration.
It’s also not clear that typical grants are enough to close the gap to “more than half” as the op remarked.
This is because of leverage. Implement software that speeds up a process by 20% once, and every time that process is used from then on the speedup adds value.
We're lucky to be working in a field that enables us to add a lot of value, for relatively little capital costs, and pocket a good share of the difference.
I don't think this is true. Take all the non-tech companies that rely on software and hire tons of engineers, such as insurance and banking.
Imagine there's no Version, it's easy if you try...
Really, no concept of version: you buy a piece of software as it is, take it or leave it! Either it works enough for you or it doesn't. No bugfix in the next release because there is NO next release. The musician, ehm... developer, has switched to the new shiny thing. You modified yoour environment slightly and you need a tiny change on the software to adapt? Too bad it does not exist!
Really, the point I'm trying to make is that comparing software developers to musicians doesn't hold a lot of water. Both professions include creativity, but a song shipped is as immutable as a piece of hardware. Adaptabillity is what makes software as worth as it is!
A song surely requires a skilled professional. But a game required dozens of those, with years of experience and lots fo time.
Creative industries get way lower pay because the skill level needed is low compared to many others, like law, medicine etc.
If you are talented you can paint great pictures or be a great guitar player in 1-2 years.
To be a good doctor you need what? like 10? 20 years?
If you want your [game, software, song, ...] to reach a certain level of polish and fame, you need a similar number of people working on it. Mixing, mastering, recording, composing. You need someone who's very good with sheet music and knowledgeable about all parts of an orchestra if you have any orchestral parts you want played on real instruments.
And so on.
Can I make a song in a week that'll impress a few tens of thousands people? Sure. People write in to me all the time saying "this is just what I needed!" They don't notice I banged it out in Ableton in an hour because it's what they needed. It's what I needed too, so it was easy to make it good enough. Just like you can make a game or a piece of software in a week that'll scratch a lot of people's itches even if it's not perfect.
Recently, I got back into photography, and it's the same. I can take a great picture on my own and impress a lot of people, but most famous photographers have a staff that rivals the biggest non-unicorn SV startups. Editors, lighters, second (or third) shooters, general A/V crew, marketing, office staff, etc.
First of all, even though "all in one" songwriter/producers exist today, you don't see them in the spotlight until they've already worked on their craft for many, many years. But in most cases, the commercial songs we listen to involve AT MINIMUM 1+ songwriters, 1+ producers, vocalist(s), professional instrumentalists (if it's not a band and/or a song where everything is programmed), an audio engineer, and probably a mastering engineer. And that's on top of the scaffolding of a bunch of other peoples' work (beatmakers, sample packs, recording studios/labels, etc etc). Each one of these people may not be formally educated, but you can bet they've spent years with trial and error honing their craft.
> If you are talented you can paint great pictures or be a great guitar player in 1-2 years.
What makes you think that? And if we're going to have such a low bar for "great", can't we say the same thing with programming? I mean, I know people who go to boot camp for 1 year, work for another, and then call themselves intermediate programmers and get paid $100k+. Same goes for law. I'm sure some real smart and performative people could become great lawyers within a year. The only reason that would never happen is because you literally have to go to law school for X years as mandated by law.
Don't mean to have such an aggressive reaction here, but I am really tired of the crafts being devalued so offhandedly.
Which explains why they are so in love with evergreen software that constantly changes things largely for the sake of changing them I suppose.
Also unlike in some creative industries, software engineers tend to have higher education and are better able to understand their economic contributions.
Software solves hard problems it is constantly evolving and updating so you need lots of personnel to maintain it, with a lot of knowledge so it will never be cheap, and great engineers to create it in the first place.
Take away a bunch of artists nothing will change. Take away a bunch of critical software - the world will stop.
So no, it will last and it will last long, as the world becomes more and more technological.
It is unprecedented because software and computer world in general is a huge breakthrough and is only 30 years old. Music on the other hand is thousands of years.
Is that right?
Is there any evidence that a society can exist without art?
There’s an overwhelming body of evidence that suggests it can do so without software.
Art is a broad concept - it doesn't suggest any specific form or delivery. Software is fairly concrete - it has to be run on a computer.
A more appropriate comparison would be art versus scientific research, or art versus engineering. I think that's a more interesting question, to which I would say: perhaps we could survive without either, but I can't imagine we'd thrive without both.
Perhaps the difference is that musicians don't change a completed work. There is no maintenance cost. A song doesn't become useless and obsolete if you don't pay the musician to continually improve it.
For static software, I'd expect it to look more similar. How much of Tetris went to the people who wrote the software?
Startups pay well because speed is so important and faang pays well because their margins are enormous and the risk of those shrinking is worth paying top dollar for the absolute best talent in the world.
By contrast I'm a HW builder (mechanical engineer / industrial designer / design manager). I make good comp but maybe 70% of what my similarly leveled colleagues in SW do. The vast majority of the arguments in here still apply to my work, with a little less focus on maintenance. And yet my job role's comp is in a slow decline. Why? Because it's fully commoditized.
Anecdote: I used to work for a HW focused VC leading their internal incubator/consultancy's physical design team. One of our ML focused investments got acquired for a ton of money and every other startup in the building wanted to know how well compensated the team was going to be. It's odd to see some people at the water cooler suddenly be worth millions when your startup is still grinding, it makes for stark contrast and a very real "what if" to the onlookers. One of the Sr MEs at a struggling startup was clearly jealous and lamented to me, "man, screw machine learning, how come nobody is paying me a million bucks for my work?" To which I said "let me ask you something, when you were studying mech-e in school, did you ever use steam tables?" yeah. "Did you learn about the Carnot cycle?" yeah. "Have you considered the fact that our industry is 200 years old? It stands to reason that our jobs are not hot shit anymore. Be glad you like your work and are still paid well; ignore the new kids if you can."
There's SIC / NAICS / ISIC codes, or tier classifications, ranging from three (Qesnay) to five (Clark (1940), Hatt and Foote (1953), and Bell (1973)):
[A]n economy's major sectors, as delineated by Clark (1940), Hatt and Foote (1953), and Bell (1973), correspond to major stages in the essential life process. The primary sector -- agriculture, fishing, lumber, mining, oil and gas -- represents the extraction of matter from the environment to produce energy, including the calories to sustain individual organisms. The secondary sector -- processing primary goods, as in construction and manufacturing -- represents the synthesis of matter and energy into more organized forms (negentropy). The tertiary sector, including transportation and utilities, represents the infrastructure for distributing matter and energy about the system, while the quaternary sector -- trade, finance, insurance, and real estate -- constitutes a parallel infrastructure for the collection, processing, and distribution of information that is necessary in all living system for the control of material flows. Finally, the "highest" of all sectors in its remove from the physical environment is the quinary sector, including government, law, and education, representing the societal programming -- socialization, education, law making -- and collective or representative decision making to effect control.
-- James Beniger, *The Control Revolution,8 p. 179.
For participants, perhaps: unskilled labour, skilled labour, professionals, managers, finance, consumers?
Or, Patio's Law, rephrsased: "Look at the very significant things you encounter with fresh eyes. You already know how to get to the crux of issues. When you get there, FRESH EYES!".
A tray loaded with tea and coffee making equipment and supplies, like you get in hotel rooms. Not a tray for carrying things around.
In other cases, they're small companies that own a market that's too small for a large competitor to go after. $10m/yr will not make VCs happy. But it will certainly pay nicely to a team of 12.
>Hidden champions are relatively small but highly successful companies that are concealed behind a curtain of inconspicuousness, invisibility, and sometimes secrecy.
So if you think the software market is large, consider all the stuff software never reached.
One company a friend worked for billed internal developers at twice what IBM would charge for projects.
At other companies, dev time is allocated without any kind of cost analysis whatsoever. It reminded our Romanian business analyst of the Soviet Union.
Business logic doesn't make for elegant APIs that I can hide behind a script and throw on a server, even if it's repetitive or tedious.
Can you give a few examples, please?
I worked with him to develop a Python script do basically automate half his job in a few hours that could have saved the company tens of thousands of dollars. The company didn't want to dedicate/hire an actual programmer to maintain it, so they kept paying employees to manually scrape the web.
The crazy part is the next summer he interned at a different company and literally the exact same thing happened. He re-made the original script, saved tons of work, and the new company still didn't end up using it after he left.
A manual process is robust, fault tolerant, and easy to adjust to new circumstances or changing business requirements.
A Python script is fixed, and they day it breaks down due to some slight change in scraped data, you have to pull in a developer to fix it. For a company without dedicated staff to support such automation, it is a high risk.
Ad-hoc automation can turn workflows into Rube Goldberg machines. A Python script here, an Excel macro there - soon nobody knows whats going on and nobody dares change anything.
Developers often think only one step ahead: It was manual, now it is automated with a script. Win! A business have to consider that larger picture - future support, maintainability, risk etc.
It may be lucrative for the friend to take the script and turn it into a product. but then they'll need to market, sell, document, optimize, and do a million other tasks.
There has always been a dead zone between "automated script that makes me work a bit more efficiently" and "product that can make everyone with this job work a bit more efficiently". Fortunately, new technology is narrowing this gap.
Managing attributes and taxonomies for ecommerce.
Capitalizable hour analysis for software projects.
That's just stuff from the last few weeks. None of these are hard to automate but the workflow integration is the tricky bit.
Also, what does "Capitalize hour analysis" mean?
A tool where you are given a picture/scan of a table and it spits out a table that can be pasted into Excel. This was at a bank where numerous people spent half their days manually typing in scanned documents into the same table in Excel. You would double a $70,000 a year financial analyst's productivity with this.
A portal to manage employee and employer documents. I.e where both you and your employer can easily access your T$ (Canadian tax form), offer letter, certifications, police checks, etc.
Software to manage which options a client ordered and what their selection was of that option as well as autogenerate the appropriate SQL queries from a client config template. The current process consisted of a mega word document with people fiddling around manually with it.
Happy to provide more.
Our requirement was that the the software would need to read the number of separating lines in the table and output accordingly.
Maybe it can do this, idk. I was an intern at the time.
We were using tesseract for our attempt too.
Or said another way, it can be fun and also effective to "Do Things That Don't Scale" [http://paulgraham.com/ds.html].
Some of the scanned forms have marginal notes (probably okay to ignore these), but I've noticed some cases where the form had prefilled data crossed out with handwritten data replacing it.
Please let me know if a system exists that can deal with this idiosyncratic mess and coaxed to produce structured data of some sort without basically using MTurk behind the scenes. I would be interested in re-releasing the data into the public domain.
The bottom line was that we were able to achieve very good results consistently, but the margin of error was not acceptable for our specific use case.
I think many companies could benefit from a team like this.
If my team of 8 devs had just one dedicated to improving infrastructure and processes, we could probably increase our overall output by 30% in a year.
If you propose the automation yourself, and plan it's adoption within your team, you may have a chance of taking advantage of it, and even try to bring in more responsibilities within the company to your team to secure your teammates jobs.
Of course it requires getting out of your comfort zone... a lot of dev's just want to exchange labor for cash and grind out code because it is comfortable and cozy (right now).
There are tons of small towns and cities with their own economies. And a lot of these places it means a lot if the people purchasing your product or service can get on a phone and talk with someone 20 or 30 minutes away max.
A friend of mine built a text message to email system for this rural delivery guy for the purpose of letting his office assistant manage invoices, but also allowing him to fulfill orders on the go without talking on the phone as his customers can just text him. Charges him $500 a month for that.
That kind of thing is trivial to do, but can still have a lot of value. Remember, the small businesses don’t automate anything. Excel is frequently beyond them.
So it isn't software we would consider production acceptable. The code quality is atrocious. None of these people I know who do this would ever get hired as a software engineer by any company that does a coding interview.
But you pair their can-do attitude with a willingness to sell and tell them to use Django so they can get away with not knowing a lot about key software concepts, and you can make a living off selling niche atrocious software.
Plus, 90% of what most small businesses need could be replicated in Wordpress with plugins.Plenty of money there too.
My first dev job we just crapped out WordPress sites, I mean WP was just a "headless CMS" pretty much, since it has auth/users/routing/editor out of the box. So we just built pretty pages/uis. It was interesting, in that level, the owners of the company were making bank. There was something I made that cost $30K and I was like wow... I was not paid anywhere near that. This other thing a single person developed was over 6 figures... I think that's an example of selling value over quantified time(within reason).
Oh and with WooCommerce you again had this "headless" shopping system and you could throw your own styles on it.
My aunt paid $8000 for nothing more than a Wordpress gallery for her business and paid $100 for every change she wanted to make.
People who don't know tech will pay a lot for it.
One of my friends lives in a rural area where most businesses never got beyond the Church bulletin board and the phone book.
Suddenly they became cottage country and none of the local businesses were getting any business as they wanted to see websites or at least written down phone numbers and they don't use phonebook.
Take a walk through the small business section of your town and see who has a website. If they have a website, try to get them on Shopify. Lots of desperate closed businesses who will take a gamble on that right now.
The reason tech has not arrived is that there is no person standing in front of them making it extremely basic for them.
So ... they then pay you for helping them get on Shopify? I can see how one might be able to convince a business owner that they could benefit from using Shopify, but is there room in there for a third party to sell configuration services?
Please forgive my being a noob with regard to Shopify. Their "getting started" page makes it seem like it's something the business owner just does on their own, so how does one come across as a _useful_ helper for that process?
You are vastly overestimating their computer savvy in many cases. Lots of small businesses barely have email. So even with the self onboarding option, many businesses need help.
But what I was thinking was more in line with this:
https://developers.shopify.com/custom-development
I am admittedly not a Shopify developer. I just have friends who make decent coin doing it while not being very good coders in general.
Oh man... that's what I'm after, problems like that. Would be so neat even if it's small to see it get used(users) and the analytics/small income.
If you're having trouble getting your foot in the door, like I did, I'd recommend looking at software developer in test jobs. Depending on the company, you'll get a chance to touch a few different codebases (in my case, I got to learn Swift and Objective-C, and sharpen my Java), and you'll get to work on a team, using common tools you might not have been exposed to yet (e.g. Jira). It's a great, relatively low-stakes way to get into the industry.
There’s a lot of opportunities for ERP developers and other tech roles that don’t exist in SV.
The company is privately owned and not venture backed so you'll never hear of them unless you are in that business.
Is the implication that venture backing needs growth so they get heavily involved in the media circus? I suppose that makes sense. I've always liked these "shadow industries", I've run into a few personally looking for things like special cut metal or wholesale pie crust or curtain rails.
Meanwhile, the media doesn't have much to work with when reporting on privately held, non-venture backed companies. There's no official valuation unless the company sells (sure, once you get to be the size of Cargill or Bloomberg, reporters will try to calculate some sort of valuation, but very few companies fall in this category), and the owners typically have no good reason to want publicity from the media, especially if they are selling B2B.
But i agree that it's fundamentally a people business - you're trying to convince a business owner to change their way of working for the better. You will need to present evidence that it is _indeed_ better - that's even harder than it sounds. And in most cases, SaaS providers are very biased on the value provided vs charged. I tend to think business owners as conservative, and therefore, the new SaaS product will have to provide extraordinary value to be considered.
That they are not being picked up suggests that there's some other constraint. Either extracting this value is not really worth one's time, or the bottleneck is not the ability to automate things but some other rare skill.
Why aren't they picking up the bills?
But it takes a long long time to pick them up.
"overnight successes" can take years.
I think there's a lot of stuff out there that would provide value to both parties if they could simply connect. Something like Gumtree or Craigslist is an attempt to capitalise on this.
e.g. I have a broken machine. It'll be useful to someone for spare parts, to fix and resell (or for fun), as a placeholder (since it sort of works) until they get something better. I'd probably give it away. But dealing with all the time wasters on such platforms makes me want to just toss it.
It's similar for some ideas where there is definitely profit to be had, but simply connecting with the customer, convincing them that it will help them, convincing them you're actually honest, etc etc, all costs more than it's worth.
1) Being a non-technical founder is expensive
2) Being savvy at online marketing means you probably were able to figure out that the cost of customer acquisition was higher than the price people would be willing to pay for the product
The reason businesses do inefficient things is because humans are stupid habit-driven animals. To break them out of their habits, you have to assault them with expensive messaging and literally shake them until they realize you have built a better way.
The article mentions actuarial software for funeral homes. In retrospect, of course that's a thing, but asked to name low-hanging domains for lifestyle software businesses, few of us would ever arrive at that answer, let alone in the first 500 guesses. And is it sexy enough that we'd stake our livelihood on it?
I'm reminded of this XKCD comic: https://xkcd.com/1425/
People in these small niches can't easily tell the difference between things that are too hard to be worth the money vs things that are solved by a for loop in an afternoon, and they don't talk about their work in a way that makes it obvious that there's gold in the hills.
This is one reason that user research is an entire field that gets paid almost like engineering: framing the problem can be just as hard as the problem itself.
And businesses not knowing what _can_ be done with software to commission developers to solve it for them (or if they do, the lack of empathy from the developer ends up with them building a half-assed solution).
I remember working on a construction survey crew in high school, where all survey measurements were recorded by hand in notebooks, and then manually transferred to Excel to perform some trivial operations. The office had hundreds of notebooks lying around. The leadership had no idea it was possible to have an application built to solve something like this. Perhaps they're using something now — I sure hope so.
I work for one of these bespoke ERP companies, our niche is CNC machine shops (huge industy you don't hear much about). Our software was grown organically out of tools we made to manage our own CNC shop, spun out into its own company. That deep domain knowledge is what allows us to make a competitive product.
If this kind of stuff interests you we're hiring: https://www.proshoperp.com/company/careers/
That is the paradox with ERP: they are sold as off-the-shelf solutions but customization costs twice the licenses and always ends up producing a bespoke monster.
They also sell some easy systems, like a LEGO car, but usually it's better to strip them down and reuse the parts of what you need is a house.
I am into ERP, WMS, TMS and BI software. You don't hear much about this on HN but worldwide it's huge because it is what logistics run on.
Most of the time it's also old software and I believe there is a lot of money to be made. For example machine learning can be used to estimate goods that have to be purchased to keep optimal stock.
And when you get right down to it, and start having the type of deep dive talks need to have with potential customers, you'll quickly discover there's already solutions to almost every conceivable problem out there, even in the some of the most esoteric fields you can imagine.
> people tend to react pretty negatively the moment you even mention "repetitive processes". No one likes automation: they associate it with getting fired.
Those aren't the people you should be talking to.
> you'll quickly discover there's already solutions to almost every conceivable problem out there, even in the some of the most esoteric fields you can imagine.
That is irrelevant for most as you sell them the implementation of that solution then. It is a $20 bill, not a Y-Combinator worthy idea.
It's one massive long integral math equation.
It rents (yes, rents) out for $20K a week.
There's also coffee logistics software. There's software for private club management(tennis, polo, etc), moving and storage, even software just for spa's.
There is so much opportunity out there, the trick is finding it, and finding a working sales method.
I argue that they are. It is just that the dollar bills are stuck in the mud or hidden under a leaf or just down paths you rarely take.
The bottleneck is knowing about them. You need to be the kind of person who thinks everything is done poorly and then thinks of ways to do it better.
The other bottleneck is that extracting them frequently requires annoying human interaction, but if you are willing to do it endlessly, there is plenty to do. I'm not and I lose out on a lot of projects as I don't want to do that.
But I know some absolutely terrible software developers (i.e. expect to see your password in the source code kind of developer) who outearn most devs I know simply by selling vast amounts of solutions to the thousands of people they meet every year.
Spend the day talking to random shop owners. Spend the night hacking together a fix for them. Collect an ongoing fee.
But of course, the people doing those jobs aren't going to go out of their way to make 90% of their job redundant.
Just because something can be done automatically doesn't mean companies can magically discover it and pay for it. You still have to sell it to them.
There are a ton of these heaps of bills, sure, but they aren't lying around on the floor so much as on hilltops and mountains, to abuse an analogy.
It may help to think of these opportunities as a form of technology arbitrage. In order to take advantage, one or more people have to a) understand the technology, b) understand the problem domain c) understand the workflows and d) identify and communicate effectively to the people who can actually make the decisions.
How many people do you know who are both competent and interested in all of these aspects? It's not that any of these skills are particularly rare, but they are rare in the same person and there aren't natural communities, for the most part, of people who can do all aspects.
Another issue is sometimes (often, really) the technology aspect is the smallest and least interesting part of the problem.
My first job out of college was working for a company that makes tilt-tray sorter systems. These are giant machines that go in warehouses and sort packages into, for example, different bays to go on to trucks to different places. It's like a little roller coaster for boxes. It was something that I had never even considered the existence of before I worked there. But someone has to make it.
Cardboard box industry in USA is bigger than the NFL, NHL, NBA, and the other major sports leagues combined
there's 7 billion people on this planet, and most of them wear at least 1 pair of shoes (so 4 end bits), which means there's about 4x7,000,000,000 pieces of these things.
I'm surprised it's only a 800,000,000/year industry! That means they are able to produce it so cheap (i.e., less than 2c per bit, which is an over-estimate)!
Also, just because an industry brings in lots of revenue doesn’t make it a good industry. I’m sure there’s trillions of dollars exchanging hands in the plastic bag market, but I’m also sure that the margins are getting squeezed so tight that even a PhD in OR couldn’t find a percentage point to optimize. The margin per bag is essentially zero.
that's a good outcome imho (and it's not zero, it's just very low). But this means that the value of the bag and the cost of production is very, very close, meaning it's available to as many people as possible!
That you can, for the most part, peel back layers and trace steps back to an origin is one of my favorite things about code.
But for a heterogeneous system of opaque supply chains in the physical world?
For any given random stuff, I don’t know that I could make reliable progress in that endeavor.
I bet you'd get better at it after doing it for a while, and that in itself is a valuable skill.
Something can just be interesting to read. Especially for kids.
I had no idea there were mafia cartels that had wars about avocados.
"The Fish That Ate the Whale" by: Rich Cohen is a phenomenal read.
From an american point of view it doesn't make sense for the amount of capital investment to happen so quickly, but that does seem to be true. Entire products with complex supply chains.
Entire industries seem to be born and then completely die much much quicker than I thought possible.
I would love to understand how all that works more deeply. Seems interesting.
I am in situation after situation where I want to create software to make someone's life easier, but I know that in doing so, I won't make any money and it will make my life harder.
I wish there was a way to make money creating software that could really help organizations that won't pay for the tech they need.
Seriously. I can list tons of things that are reasonably profitable, but I, personally, don't want to do the hard work of customer support so I won't even start.
This in itself is a business idea. We need an Uber for Sales Support Staff that entrepreneurs can just rent by the hour.
Many, many, many companies still see shared excel spreadsheets on a windows shared drive as a technical innovation.
Not just small ones...
For instance: Hohner (the Harmonica manufacturer), or Flexi (dog leashes)
Every country has some of this hidden unicorns; but it is easier to spot them from the distance.
A company worth a lot of money that has existed for 80 years isn't a unicorn, it's just a company worth $1B+.
Once you're executing on a scalable business model, you're a regular business.
Previous comment with fancier wording: https://news.ycombinator.com/item?id=17994976
Imagine you harvest 1 fruit, chop it and package it, and then duplicate the result millions of times. Then each time you sell your chopped fruit, it's somehow teletransported directly to the customer.
That's software.
I know it's hard for the avg hackernews to understand but software isn't always a blessing but many times a curse bestowed upon workers by someone in the mngmt chain who has been sold on a solution.
A variant of the current law also makes an appearance:
"The amount of money flowing through capitalism would astound you. The number and variety of firms participating in the economy would astound you."
My picks are:
"Startups are (by necessity) filled with generalists; big companies are filled with specialists. People underestimate how effective a generalist can be at things which are done by specialists. People underestimate how deep specialties can run. These are simultaneously true."
"You radically underestimate both a) how much you know that other people do not and b) the instrumental benefits to you of publishing it."
this is a particularly confounding problem, and i haven't figured out a way to combat it.
it's so bad, that i'll often learn something new when scrolling twitter or clicking through wikipedia, and then immediately assume that 1) i'm the last person to the party, everybody else already knows, and 2) forget what it was like not-knowing this fact mere seconds before.
It's a pretty popular project management software, 56 employees at this point if I remember correctly, probably millions in revenue. It's a tiny, bootstrapped company, no investors breathing down their necks, no IPOs, nothing. And they're one of the few companies who actually have principles, are committed to privacy etc.
The vast majority of companies like this have perfected the lock-in strategy to ensure that their customers can never leave.
Is that unique to Basecamp or does it apply to all similar software? I haven't Basecamp all that much. What exactly do they do to ensure this?
There's also the idea that if you provide an easy way to exit the service then people are much more likely to buy the service. Since they know they can easily get out of it if they don't like it.
Every industry seems to be full of these. The last place I worked is using timeclock software that doesn't look like it's been updated since the Windows 3.1 days. They probably paid someone $50k at the time to develop it, and the minimum installation of it costs $25k.
"Hofstadter's Law: It always takes longer than you expect, even when you take into account Hofstadter's Law."
Just a couple corrections, at the end of 2019 we were just under $20M ARR (Not $24M). Today we are at $22M ARR and 30,000 customers.
You can see all our numbers (updated in realtime) here on Baremetrics: http://convertkit.baremetrics.com
I'm happy to answer any questions.
the crazy thing to me is none of my friends have heard of them.
Along with the comments about basic products being worth billions to sell.
Industries are deeper and wider than we assume, supposedly this is revelation for some?
Is there a name for laws that gratuitously reference themselves?