Rocket Lease: 1 Year Review

- We increase our sales every year until the 2007/2008 crisis, where we needed to use the company savings because the world changed completely for us. It was 2011 the year where we were more confident that we can remain in the Windows sector and not jumping to the web or mobile bandwagon.

- We were very conservative in our salaries. They were below the top 20% salaries in the industry.

- We spent around 1/4 of the profits (that's a lot) in risky R&D for trying new things. The fruits of this came 3 years later and there is an intersection between being lucky and producing stuff. There are a lot of things that you produce or think everyday that can be converted to blog articles, small products, etc.

- We dealt with all companies sizes and that's is difficult to learn. The same project that is trivial to solve in a small company is completely different when you deal with a big one: a lot of stakeholders that keep you busy in the communication loop and testing your solutions with an army of testers. Your solution does not have the same price if it requires a lot of communication and is tested by professional QA teams. One of our software components is installed on million PCs.

There are no quick wins, it's a grind.

I spend my time doing marketing and bizdevy stuff. However, I'm still really involved in any major development efforts, we regularly at least 3 times a week discuss code, I still contribute code, and we often pair program.

My contracted developer, Henrique, is really not just a "contracted developer". He's a CTO caliber amazing architect and I consider him a partner in the project.

The current codebase is the 3rd-ish iteration on the same theme. The first and second iterations were built primarily by me, so I had a pretty good sense of how I wanted everything built for the future (incidentally, my "pretty good sense" was totally garbage, and if i started over again, it'd be totally different... again...)

Even the early versions of the current iteration were largely a collaborative code effort between me and Henrique, either hitting milestones by "divide and conquer" or by pair programming.

As the product began maturing, I have been slowly shifting away from code to marketing and CEO/CMO-y stuff. Basically, I am not good at being a heavily involved CTO and marketing. My perspective here is that development CAN be outsourced, though it may not be easy, but good marketing and bizdev can NOT. However, we try to be analytics driven, so Henrique is also deeply involved in the marketing and analytics, but we just have a focus on our own individual domains.

2. Looks like you're now making a profit but a really small one... for May 2013: $5660 - $2377.23 - $1808 = ~$1500, is that right?

Correct.

3. Sounds like your revenue vs costs/expenses scale linearly as well, but more business = more margins, is that right?

In principle, I can squeeze out a little more edge once I get to bigger scale, but there's a floor on the cost of reports, so I'm more interested in growing the audience size than optimizing the costs here. I'm also below the threshold where reporting companies really want to cut me breaks, so I'll have to wait a little further before that.

The "cost of reports" component scales linearly, but I expect the fixed costs to be pretty static for very large ranges of total users/applications. It'll be stepwise-ish, but I'll probably flat until at least 10x more sales from here.

I personally would also like to see more transparency among founders.

I think there's a fear among entrepreneurs that if they post their data publicly, one of two things will happen:

(a) they'll be judged if they're not succeeding wildly -- its easy for startup founders to seem glamorous when there's a fantasy that they're just living the startup dream (which, at least in my experience, most of us aren't just rolling in rooms full of gold coins). without the certainty that they're not succeeding wildly, founders can bask in the adoration of their unknowing peers and reap the rewards of semi-fame without the actual success.

(b) if they ARE succeeding wildly, that competitors will know how much money they're making/losing -- this information has never helped anyone. knowing that RL makes $X doesn't immediately make my competitors make $X. RL has succeeded, I think, mostly because I'm willing to work hard, and not because I'm tricky or smart or have some magic silver bullet.

I, for example, would like to have sex with Heidi Klum. Finding out that Seal is having sex with Heidi Klum does not confer upon me the privilege of doing so. Knowing that a startup is making money won't make it true for you.

Has been a pleasure working together with you as well