Startups Open Sourced, 1 Week Later: $10,000+ in Revenue | Hacker News Reader

Startups Open Sourced, 1 Week Later: $10,000+ in Revenue

startupsopensourced.com

127 pointssiong198747 comments

> If you’re feeling really bold, try out Evan Reas’ hack: tell them you want them in your book so badly, you’ll e-mail them every day for the next 30 days with a good reason why they should do it.

If someone were to do this to me, it would bring me from on-the-fence firmly into the "no" camp. It shows a blatant lack of respect, IMO.

If someone were to do this to me, it would bring me from on-the-fence firmly into the "no" camp. It shows a blatant lack of respect, IMO.

That was my initial reaction as well. But after thinking about it - if the guy emailed me every day with a good reason, I think I'd start to be gently amused. Could work. Irritatingly ;)

I think that may be the part that bothers me more -- this could well be beneficial to me, but by showing me a complete lack of respect, he's ensuring that it never happens. If, instead, he provided me a couple good reasons upfront, we'd probably make things work, without emails badgering me.

I wouldn't read the emails after day three, I'd probably have them automatically filtered by day five.

wouldn't it be easier to just send an email back saying "I'm not interested; please don't send more reasons", after reading something along the lines of "Let them know that if they ask you to stop then you’ll stop, but otherwise you’re really excited about talking to them."

It worked for Andy Dufresne ...

This was exactly my thought, but Andy was handwriting his letters and this maybe happened 50 years ago(in the mythical world). I would always value somebody that is persistent but only if he was demonstrating his persistence in a non-trivial way.

Whether it works or not is tangential to whether or not it's a good thing to do.

One of the people I most admire is Vinod Khosla. He got Sun Microsystems one of their first contracts by camping out in the lobby of a customer (they wouldn't take his meeting) and meeting them on their way out daily to tell them why they should do business with him. He did the same thing to get into Business School at Stanford. He was rejected but just came anyway and after hanging around for two weeks, somebody dropped out and they let him in. Persistence pays.. but yes, the trick is to do it in a respectful manner.

> AppSumo.com 24-hour special: $8,120 (keep $2,436)

So AppSumo made $5684 in profits by promoting and selling your book? What a sweet business model..

Sweet indeed... would love to hear more about this.

It's the same model as Groupon.

The article mentions that the author only requested a 30% share - to ensure that it was featured on AppSumo from what I understood. I'd imagine the normal cut is closer to 50-50.

$10,000 per week sounds like a good haul, but his personal share was closer to $3000. If the initial rush of sales dies down, he'll be making less than he would at a job... and that's excluding the opportunity cost from all the unpaid time it took to write the book. I guess what they say about writing a book being a labor of love is true.

Not sure I follow your argument here. The thing about selling an ebook is that it's all passive income from here on out. Assuming he set everything up correctly, which it appears he has, the author has to do almost nothing to propagate the sales of his book. Sure, he could put in an hour or two a week for advertising, emailing, etc, but that's negligible. The ball is already rolling, so there's nothing stopping him from collecting money week after week while he works a real job, writes another ebook, or runs a startup.

Look at the sales spike, there's no way that's a sustainable income. 80% of the sales was from one 24 hour period where he gets only 30% of those sales.

From scanning the article he didn't really say how long it took to write. There's 32 founders on the 'founders' page, sounds like he put well over 3 or 4 hours per founder. Quite a lot of transcribing and interviewing by the look of it so I'd guess at least a month.

Kudos for him for making a couple of weeks salary in a week, but put it into that context. He still only made $3,000 in a week after already putting the unknown time into the book.

Ignore the $10k claim, $7k effectively went on advertising (appsumo).

imho, the real winners in the story were appsumo.

I'll need to adjust this. We talked about it again and Noah insisted on paying me more. My cut will be $3 per copy on that $7 sale (42% gross) before PayPal fees (I am not sure what that will net to). Effectively, my cut will be closer to $3k or $4k, rather than the current $2k.

I'll update the article when i can with the most accurate information.

I look at it like buying a hybrid vehicle. I haven't checked lately, but when they first came out the hybrid model of a particular vehicle was often $10K more than the non-hybrid model. So there's a $10K opportunity cost in order to realize passive gas savings from then on. However, even the way gas prices are now you'd have to own the vehicle for 10 years just to recover your $10K investment. On top of that, in 10 years time you could have turned that $10K investment into $20K if you were able to average about 7% interest.

Writing a book full-time seems to follow the same pattern. I'm not seeing how the investment ever pays itself off. Now, if he wrote the book by spending a few hours on evenings and weekends where his time was otherwise worth nothing then any money made is all profit. In that case the passive income, even if it's only a few hundred here and there, is all good.

On top of that, in 10 years time you could have turned that $10K investment into $20K if you were able to average about 7% interest.

Could ;-) What "safeish" third party investment vehicle would average a yield of 7% per year after taxes over 10 years? (Putting aside the bubbly stock market of the 90s and the property market of the 00s.)

Writing a book full-time seems to follow the same pattern. I'm not seeing how the investment ever pays itself off.

In many cases, the exposure and experience pay their own dividends. More practically, though, it's not always possible or desirable for us to work every hour we can grab, so "cramming in a book" that we want to write on the side can get more out of our time that we might not otherwise profit from.

> $15 per audio hour may seem low, especially considering that one hour of audio may take up to 4 hours to transcribe. But when you look at the conversion rate, it’s not that bad. $1 USD converts to 83 Kenyan Shillings. I paid around $800 total for the transcribing, which converts to 66,400 Shillings. That’s about a month’s worth of rent in Nairobi, the largest city and capital of Kenya.

This bothers me. Yeah, rent and food is going to be cheap in Kenya, but an iPad will cost the same. There's a good chance it'll be costlier because of import taxes.

Of course, this is a unique case where transcriber had no feedback. In general though, you shouldn't be paying someone based on your opinion of their cost of living. It demonstrates a lack of respect, and shows that you don't treat them as an equal human being.

Maybe it's idealistic nonsense.

Isn't this concept the whole rationale towards foreign outsourcing?

> It demonstrates a lack of respect, and shows that you don't treat them as an equal human being.

He paid the transcriber at a rate that the transcriber was willing to be paid at. If the transcriber didn't want to get paid $15 / audio hour, he could've simply walked away. Smart? Yes. Disrespectful? No.

> This bothers me. Yeah, rent and food is going to be cheap in Kenya, but an iPad will cost the same.

You do realise where iPads are built and how much those people make? :-)

Outsourcing work to cheaper places is part of this world, and sites like eLance bring the power to outsource to people like you and me instead of just letting large companies enjoy it.

Also, you don't know what job that Kenyan would have had to accept if it wasn't for eLance.

What's more, his figures work out to 5.3 weeks of work at 40hrs/week, for the equivalent of one month's rent (not one month's living expenses). Be a shrewd manipulator of globalization if you want, but don't try and justify away the raw deal you're giving someone to save a few bucks, especially considering those bucks would be far more valuable to the guy doing the work than the guy who is saving them.

A relative used to do transcription so while in the worst case it may take 4x as long (bad audio + intelligible speaker) he often worked at about twice real time. So that 15$ / could be anywhere from 4$/hour to 30$ an hour.

PS: At those exchange rates 66,400 Shillings = 800$/month rent which seem really high. I know people in the US paying under 600$ / month rent for fairly reasonable apartments near major city's.

I read most of this. It was worth the $20. (Wufoo: "We're a fan of [ad retargetting] because it works." is probably worth $20.)

Yep, I am a fan of retargeting as well (if done within limits so as to not spook your users). So many users congratulate us for advertising Visual Website Optimizer every where on the web: Youtube, CNN, Digg, etc. They think we have big advertising budget. But we really have $500 budget per month. Retargeting works wonderfully as far as brand recall is concerned!

I recommend AdRoll and Retargeter for the same.

The title demonstrates why "open source" is a bad term to use. It's been loaded with multiple meanings. I thought the book was about startups that created free/open source software.

The first thing that struck me was the amount of money AppSumo was keeping.

I'm not sure it's as effective for 'big bang' types of things like this where you want to sell as much as possible in a brief period, but to me, starting with a Kindle version only makes a lot of sense:

http://blog.liberwriter.com/2011/04/22/self-publishing-the-i...

That way you don't have all the typesetting and print on demand overhead; you just get it out there and see how it goes before investing in that stuff.

cache - http://webcache.googleusercontent.com/search?q=cache:wHndBgg...

Congratulations to the author, I would love to hear some reviews from those of you who have already read this.

Congrats on your success! It seems like your hard work has definitely paid off.

Just a few nit-picky things: Not sure if you are a native English speaker or not, but your analysis was somewhat difficult to follow. Spelling was okay, but there were just weird little things here and there that were confusing. Also, please link images such that they open in a new window/tab. I can't even tell you how many times I opened an image, then Xed out thinking it was in it's own window.

For people doing consumer internet startups, learning how the average normal person thinks, what makes them tick, is something I'd pay for. All of you reading this here are by definition, not normal ;)

I feel like I'm reading the contents of a self-help infomercial.

for anyone interested, i wrote about how i dealt with the traffic here: http://jmtame.posterous.com/startups-open-sourced-is-out-go-...

the story was down for the first 20 minutes. i was trying to call siong to delete the story but he didn't have his phone on him, so i was pretty much stuck with fixing it on the spot.

i hope my linode doesn't crash again...

edit: reboot #1. this is like monday all over again. i'm resizing my linode to 4gb now, then will install wpcache. will be back up in 4 min.

edit: wow, that was like 20 minutes of downtime. it should be working now.

This advice may or may not be helpful, but I have survived plenty of traffic spikes from HN etc on low RAM machines by turning Keepalive Off in the apache config file. It is on by default with a long timeout, which will tie up all the resources during heavy traffic. Lots of people don't even know about it, so hopefully this will be helpful. (this assumes, of course, you are using apache, but other http servers have similar settings)

i changed it to that, although my apache log files aren't really giving me anything helpful. where are the cloudkick guys when you need them? ;)

Do you use munin or similar monitoring tools? Jazzychad's suggestion will only help you if your apache server is fully saturated, so these monitoring tools would instantly confirm or refute the notion. I completely agree that jazzychad's suspicions are correct, by the way.

no, but i'm going to set that up. thank you. i also realized linode is nothing like the way heroku works--that resize costed me $140. definitely not a cost-effective way to deal with traffic. i'll see if i can get it pro-rated with them since i'm only doing it for one day, and then i'll setup wpcache.

It is pro-rated. When you resize back a credit for the unused time will be credited. You paid for May is why it cost so much.

A tip for when you have a spare half hour - switch from Apache to nginx :)

Let me convince you as to why: I have a 1GB VPS with prgmr.com, and it's comfortably survived being top story on the Hacker News homepage, all whilst running my regular web apps running in the background.

Edit: If you're feeling really brave (or foolish - always a thin line), you could try setting up nginx now on a random port (e.g. 8080), and if it looks OK, kill Apache and move nginx to port 80. All depends on how much your server is struggling - would it be worth 20 mins downtime now if you don't have to worry about it again?

Edit 2: Looks like you're using Wordpress - are you using a cache plugin as well? If not, install W3 Total Cache right this very instant :) If you'd like any help with this, I'll be around for the next couple of hours, email is in my profile :)

i noticed phusion passenger is supported on nginx as well, i'll look into doing this. thanks, hopefully this will work nicely on the 512 that i had with linode.

also, i'm installing w3 cache right now. you'll probably hear from me.

Good advice but still not entirely necessary. I run several VMs and dedicated servers and have had numerous HN front pages and other high traffic leads to 1GB VMs running Apache (WordPress without caching, even). The issue here seems to be a less than optimal Apache configuration and not having just enough memory to handle the requests properly (but 1GB seems to be a sweet spot for a regular Apache setup nowadays).

Good advice but still not entirely necessary

The issue here seems to be a less than optimal Apache configuration

I couldn't agree with you more. The problem is my Apache knowledge pretty much well starts and ends with setting up virtual hosts. A year ago I was having serious issues with my Apache set up, and spent hours trying to reduce its memory footprint, and playing with lots of other settings, all to no avail. So I gave up, installed nginx... and it just worked. Which is why I'm so evangelical about it :)

That said, I'm certainly not against Apache; just the setup time and my abject failure. Which is, most likely, incompetence ;)

Yeah, Apache is like a giant lump of clay you need to "sculpt" into something useful, whereas nginx is a fast and empty potter's wheel waiting for you to throw the clay on ;-) nginx is definitely well worth it if you don't have complex Apache-specific requirements.

Another alternative I've been playing with lately is running haproxy on port 80 and then throwing requests to different daemons (like Apache and nginx) based on the host header.

I'm enjoying reading it. =)

Shameless plug. For an free Skype recorder for Windows and a painless audio transcription outsourcing service check http://scribie.com.

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