My Product Has Failed
ironconversions.com
ironconversions.com
1) I built stuff without talking to people
2) I built custom work for a client and it wrecked me
3) I didn't listen to customer feedback
Yes, your business will fail if you don't talk to customers. We're all terrified of showing off our children. What if the world thinks they're ugly? What if the child actually is ugly? Well then, that child is still going to have to make its way in the world, isn't it, or not?
Some of the best solutions to problems I've seen start out as ugly children, but, in truth, over time they find their place in the world. The difference between what makes an ugly child grow up strong, versus one dying, is the development. If your friend tells you that your kid would look better if he had a tail, and he's willing to pay you to put it on, you'd be doing a disservice to your child to attach that tail. You have to do what's best for your business; no silver bullets, no easy answers.
I think that writing these kinds of things can be cathartic, but, to be honest, if you read enough of these they all start to look the same.
The one thing I know is that your time wasn't wasted. Learning lessons is what life is all about; doing something with them is what success is all about.
TL;DR: Your product failed because you didn't talk to customers and no one is surprised. I look forward to a follow-up post about your new product, driven by customer feedback :).
It's natural to read an article about a failure and feel like the points made are obvious - but that's because we aren't imagining all the pitfalls that we may have fallen into along the way that others would have avoided. Not only that, but the rules have so many exceptions that it could have just as easily gone the opposite way (I wish I hadn't listened to my customers) and we would still say it was an obvious conclusion.
I agree, the conclusions raised are all pieces of advice I have heard before, but I still enjoyed reading about his particular mental model of what he thought was the right course of action, and then seeing how it got shattered by the (lack of) results.
I'm right in the beginnings of the growth phase at my startup and I can tell you, we've made every mistake you can possibly make without drowning the baby in the bath water. You name it, at one point we did it.
I'm talking:
* Feature Creep
* 90% revenue from one client
* Not listening and building a whole GUI in the Dark
* Attacking customers who weren't in the target market
I could go on and on, but the point is; I've been there, we've all been there. It's so easy for me to say, as an armchair observer, how easy it might be to manage a business like that, but the truth is I have no idea.
The problem is when you think you understand your target market, and you don't.
I guess the point of my previous post wasn't to tear into the author, as they're very brave to put their opinion and their work out there. My point was that the lesson we can all learn is a hard one, and one we may need to learn multiple times.
I think we're largely in agreement, but I thank you for your comments :).
This is the key bit. When my kids started getting "real" homework sometimes they would say "But Dad, why do I need to do the homework? I completely understood what the teacher was talking about!" And my response was, "Great, since you already understand it, doing the homework will be no problem at all." But the real message was there are two kinds of understanding, one where you think you know what you know, and one where you know you know what you know.
Only by applying the knowledge you think you understand to a new problem, can you prove to yourself and others that you have actually got that knowledge. In my case it actually feels like it moves into a different part of my brain (weird I know but it's the simplest way to describe it). In Boy Scouts we got a lot of training in various camping "skills" but it was the Jamborees where you had to use those skills in competition where the knowledge went from theoretical to practical.
I wondered where the random burst of traffic came from.
For those who haven't read the more recent posts, I received a ton of great feedback from HN and other entrepreneur friendly places. I've also been gobbling up great advice from places like Rob Walling's "Startups for the rest of us" podcast.
About a month ago I started a "challenge", inspired by Brennan Dunn, to rebuild my "failed" product, and it's been going pretty well so far.
Most importantly, a few days ago I announced that I'm "pivoting" from just inventory management to a full-blown ERP for printing companies. I chose printing companies because I'm a full-time developer at a printing company, and I know exactly what kinds of problems we face with our terrible ERP system. Though I need to be super careful not to build a system that is so focused only my own company can use it.
If there's one piece of advice I could give somebody else, it would be to narrow your niche like I did with printing companies. This has helped me so much it's downright ridiculous.
Edit: Also, when I originally posted the article some people were concerned that I was just trying to build a "meta" product with Iron Conversions. I admit I had planned to build a product with it, but I've put that on hold indefinitely in favor of rebuilding Rakasheets. I don't know if I'll ever return to it, so for now Iron Conversions is just the place I'm blogging about my progress.
Good luck on phase 2.
Besides the lessons you've learned, did you see an actual opening in this market, or is your motivation mostly that you think you know much more than you did a year ago? Because while that may be the case, that doesn't mean that the conditions are right for your app to succeed. From an outsider's perspective (I know as much about inventory management as you used to -- just about nothing)...it seems very hard to get people to switch from whatever legacy products they were using before...it's not just quality of competing product, it's the cost from escaping the inertia of legacy frameworks.
There's a bunch of reasons for me to try it again. The most persuasive one has been all of the great feedback I've received from trial users, people on my mailing lists and interested HNers telling me that it just needs a little bit more to be a viable product. "A bit more" in this context is stuff like accounting or order management, which I was really resistant to before as it went against the "grand vision" I had for my product.
And if I fail again, it will at least serve as a guide on "what not to do" for everybody that has been following along. I won't be any worse off financially; I'm not risking my job or income beyond the $50 I spend on AdWords each month. That being said, I'm still highly, highly motivated to succeed.
> Besides the lessons you've learned, did you see an actual opening in this market
There's a big gap in the "ERP for printing companies" market. The only big name in this area (which I won't mention for fear of legal reasons) puts out a terrible product. It fails so often, and it's so darn complicated for Regular Joe Employee to use that it's a wonder this company has any sales at all. I'm often the person that gets called in to fix the problems it causes at my own company, much to my dismay.
You're right about people switching from legacy products though, and that's definitely an area I'll need to gather more information about when I start customer development in the next few weeks.
> or is your motivation mostly that you think you know much more than you did a year ago?
I feel like I know a lot more now than I did before, but I'll never know it all. For example, I know that customer development and marketing is way, way more important than any code I'll ever right. In fact, that's why I'm not writing a single line of code beyond my MVP until I get some real customer development and feedback.
> the product is not as bad as you think
This is true. I know that I'm a developer, and as such I can easily see the mistakes that my competitor has made. Meanwhile, the average user just thinks it's a run-of-the-mill program, put on this earth to torment them like any other software.
- It sounds like one of the problems you ran into was massive undercapitalization. While some businesses can grow without spending anything on staff, promotions, marketing, etc., that's not the norm. Figure out how you can inject more resources into your business. Cash/barter/debt are all viable strategies (although debt is a potential time-bomb.)
- <4 months part-time is't really enough time to spend on a business before evaluating it as a failure. While pivoting may make sense, I'm pretty sure that $300 + 120 days doesn't generate enough data to say anything conclusive.
- SaaS products like Rakasheets are deceptively expensive for customers. This is good for the SaaS provider. Your middle-priced plan is ~$700 annually; factor in low turnover if you do a good job, and you're basically selling software in the $1500+ range. Keep this in mind when figuring out how to promote your product. The cheapest promotion channels may not be best for a relatively high-priced (vs consumer-targeted) product.
- If you're low on cash, try direct sales to start. That's you on the phone, or sending email. Or getting in your car and driving, if your area warrants it. If you're really offering something that will benefit your prospects' business, they want to hear from you.
Good luck!
If you're able to build something that fast, give yourself some time to figure out how to turn it into a business!
There was a lot of hubbub before about calling the whole thing a "failure". I should have made it more clear that I wasn't calling it a failure because I spent 4 months and only got one customer. Instead I was calling it a failure because I was no longer interested in what it did, and I had no intention of working on it any longer.
> SaaS products like Rakasheets are deceptively expensive for customers. This is good for the SaaS provider. Your middle-priced plan is ~$700 annually
This is something that I hadn't even considered until an actual small business owner sent me feedback saying the exactly that. Previously I thought people were like me, and only considered monthly costs of products unless they were buying an annual plan. It may be that I'm alone in that.
There's also the issue of how many inventory items I would let each plan track. The smallest plan, which was $29/month, only let a user track 25 inventory items at a time. That's a laughably small amount of inventory. I attribute this to not targeting a specific type of customer, but it could also easily be attributed to not thinking it through.
> If you're low on cash, try direct sales to start. That's you on the phone, or sending email. Or getting in your car and driving, if your area warrants it. If you're really offering something that will benefit your prospects' business, they want to hear from you.
I live in a small town of less than 4000 people, and the nearest printing company other than the one I work at is an hour's drive away. That makes it hard to talk to them in person while still holding a 9-5 M-F job.
With that in mind, there's really no excuse for me to avoid cold calling potential customers. If my own printing company is an indicator, sales won't be made until numerous phone calls have been made.
Have you tried optimizing the campaign, your landing pages and your sales funnel? That's where I usually spend most of the time for a product. Building is a walk in the park compared to the work I have to put into sales optimization.
Development is just a small part of running a software business. I'm not saying you should ride a dead horse - I guess you have more reasons to believe your product failed than you stated in the blog post - but keep for your next project in mind that you shouldn't give up too quickly.
I'm interested in both the theory and the practice of marketing and sales, for many things, but especially for SaaS.
All he was doing is what he wanted with the product, not what the potential customers need... I agree that you cannot do everything that the customer ask for, but from my point of view, this guy doesn't even knew the needs of his target market.
You are probably right that inventory systems are awful for small to medium businesses, so you have a business somewhere. There are others in your space so that always good validation (http://tradegecko.com).
This is what I would do:
1. Learn everything you need to know about the inventory pipeline within small businesses. How they order stock, warehouse it, receive orders, ship it, etc..
2. Blog the living hell out of what these small companies do and how you can make their lives better. This will help your SEO which in my experience is much better than AdWords.
3. If you don't already have one, produce a roadmap for your product. You won't always be able to stick to your roadmap but making one will do the following:
- Help you understand how different you are compared to your competitors. What makes you (or will make you) so special? Why should I buy from you?
- Help with conversations with potential customers that you are committed to them in the long term by showing them a roadmap.
4. Stop blogging about how you failed. I don't want to buy a product from a company that may close tomorrow because they're going to fail!!! I want to buy a product from a company that screams success. Your customers don't give a shit about how bad you are at business, they care about solving their problems.
5. Keep your product simple, be great at solving one need. This doesn't mean that you shouldn't add a contact manager if you're customers are asking for one, but that the contact manager you add isn't at the same level as salesforce has it!
6. Get known in the inventory management community. You'd be surprised how small and thigh nit these communities are. Sure IBM is huge, but they only have a handful of individuals performing outreach.
7. PR, PR, and more PR. Bug the living crap out of every tech blog, inventory management blog (big enterprise types and small types) and every other blog that fits. Don't pitch them "Have you heard about us!?",. Pitch them stories that their users want to read, and by the way, you got your data from Rakasheets.
8. Slowly integrate with e-stores and shopping cart platforms such as shopify.
9. Last thing, be patient! A company isn't built in 3 to 4 months, it's built with years of sweat and most importantly love for what you do. You built a product, which is far more than the majority of the people hanging around here have done. Be proud and "grind" on.
Good luck!
> Most importantly, I can't relate to my target demographic at all
> I'm not a small business owner. I don't have any employees, I don't have any physical inventory.
> I think this was my biggest downfall. I had to pay for content because I didn't know what business owners with a physical inventory wanted to read about inventory management.
How is this not painfully obvious to any independent entrepreneur? If you don't have the resources to do customer surveys and advertisements, why don't you stick to something you actually know? Because, assuming you are a reasonable person, a problem you have is likely a problem that others have. The main advantage, in this case though, is that feature brainstorming and iteration is much quicker...sometimes the time intervals are as short as it takes for a thought to reach the other side of your brain. And even if you don't have a market right away...or ever...you may have built something that is useful enough to you to markedly improve your life. So, almost a win win.
I can't count the number of times when, while working at an incubator, I overheard developers building the next awesome photo-world-traveling-sharing app, and trying to come up with features they think photographers might need...it was always painful to listen to.
This is something I have had to tell myself - go out and have a life as if you've already "made it", then when you find something you can fix that you yourself would prefer over the alternatives, that's your startup. Unfortunately, I think that means we have to be patient about ideas - you're not going to notice the real problems in a given area after having tried it once (unless your solution is a newbies guide or something).
This was (is?) definitely me. I have a grand total of three hobbies: Building software (also my job), playing WoW and reading.
I couldn't think of any business idea that I could build off of WoW (and I'm pretty sure Blizzard doesn't allow that), so I took a different route for finding a problem to solve:
I surfed through small business forums and picked the problem that most people were complaining about. That happened to be inventory management.
(I'm happy to say I've since quit WoW, on account of the nonexistent IRL returns).
The "Online Inventory Management without the suck" is not a great intro. It stresses an absence of something negative instead of stressing something positive and uses the rather crude and unprofessional word "suck"
You also have no sign-up form visible on first page load and no call to action (one has to scroll a little, at least on my mac).
The "not interested" inversion of "contact us" is also pretty weird and announces that you expect people to not be interested.
The pricing link does not look like a link at all.
Then as you scroll it's just a wall of text all the way to the end.
* the CTA is below the page fold which means LOWER conversions. It's also grey. I didn't see it during my first scroll. Perhaps changing the button to the yellow used in the picture would work. * the sign in button should readily have a "sign up" button next to it * the pricing link isn't really a link, like you said. I didn't even realize it was until I read your comment. I think that pricing should be available right below the page fold after the CTA, much better placement. * the main image on the page is pretty low-res, I think it'd make more sense to blow it up so you can see the detail and overlay text over it (but so that the legibility of the text doesn't decrease) * the wall of text is something I never really read. I always take note of successful products and how they convert. Both mailchimp and basecamp and many others keep their home page a single page site, unscrolling for the most part.
The copy itself is going to need to change to reflect the pivot from inventory to ERP, so happily "Inventory management without the suck" is going away.
> The "not interested" inversion of "contact us" is also pretty weird and announces that you expect people to not be interested.
Curiously, I thought this myself when I put it up. To this day, I can't fathom why I thought that was a good choice of words (or why I never changed it).
> Then as you scroll it's just a wall of text all the way to the end.
I had been experimenting with the "hybrid copy"[1] sales page that Joanna Wiebe of Copyhackers has been a proponent of. It's worked incredibly well for my actual landing pages, where a user knows what the product is about when they click whatever link or ad brought them there. However, I took it way too far by doing "hybrid copy" on the home page.
The new design I'm working on is going to be the classic home page with a brief overview of the product and a CTA linking to the "hybrid copy" features/tour page.
Edit: I neglected to mention that the "hybrid page" experiment resulted in a noticeable increase in new trials.
I'd prioritize that over any amount of A/B testing at this point, since self confidence in yourself and your product will show through stronger than anything else at this point.
In fact, I had intended the "downright embarrassment" bit as a joke. Still, thanks for pointing it out!
I've noticed a slight difference in how we in the midwest talk compared to how the west coast (Seattle and SFO) talk. In particular, I'm not perturbed by the writing style and I see clearly a confident young man who is building experience. In the midwest, often, modesty and humility are required for most public conversations. One way to express that modesty is to be quiet (think 'tough cowboy'). Another way to is be self-deprecating (sometimes it comes across as false-modesty), which is what you do. And yet another is to talk about the other person or make small talk. It's something we all do from here. On the west coast, in contrast, there is a common desire to talk oneself up either by referencing a pedigree, accomplishments, or trajectory. As a simplifying stereotype these descriptions don't apply to all people or all the time.
I would take away two lessons from this discussion.
1) The midwest modesty we both use is somewhat foreign to other cultures. Don't feel like you have to change yourself, but, don't be surprised that different people will understand you differently.
2) Focus on the product before fixing any analysis or blog or other meta-startup thing!
It took him 1 month to build his entire product! And people say he should have talked to customers first. It takes some people 1 month to mock up their product and build a slide deck and business plan, etc.
His biggest failure was he couldn't market his product effectively. If you aren't funded by a big name VC and you're tackling a ho-hum problem. Chances are, you won't be featured on TechCrunch or the HN front page.
Some ideas are so innovative and awesome that they market themselves but my guess is that inventory management doesn't land in that category.
The number one failure of startups is building stuff nobody wants. Go read some Steve Blank pronto.
Very, VERY important point. Some years back I had the experience of designing, from scratch, several dozen web sites for some state government agencies. I used to tell people, "designing a web site is like decorating a room for 50 people and trying to make them all happy." And for sure, if you jerk and twitch from every customer comment, you'll crash and burn, like the proverbial hound dog in a whistle factory.
The real question is not just whether or not you listen to customer feedback, but how you process it.
Its really hard to do this if you are not completely immersed in the problem yourself. The legacy players who have this strong position have the years of understanding the problem and that is why they command the market and at times dont even have to innovate to protect their position.
If you yourself are not your customer, it is very hard to execute, prioritize etc. For enterprise businesses this is extremely critical. Also when I say Problem I just dont mean the actual product. It also includes decision makers, sales cycles, budget cycles etc etc. The whole decision matrix around a enterprise product needs to be understood.
Actually I dont think Rakasheets has failed. You just have an expensive Prototype. If you want to continue, spend the next month in customer offices selling this. Forget adwords or any other such mechanism. Your best customer acquisition channel will be Word of Mouth. Small Business owners know many other SMBs and they share such stuff. If you can crack a few they will share that positive experience with their friends and colleagues.
Good luck!
Before I got to this point in the post I kept thinking that inventory management on an island doesn't sound like a robust enough of a solution to be of much use (I admit this is an assumption and I'm biased). What would be interesting, and something that we will be looking for shortly for our platform, is an inventory management API. We've got most of the other stuff the poster mentioned, but will most likely try to find a solution to buy for inventory management instead of rolling our own, if we can.
Good post - love the poster's frankness and willingness to admit his/her mistakes. Successful entrepreneurship is often an iterative, effectual undertaking. Don't expect to hit a home run, or even get a base hit your first time up to bat. It takes a couple of times through the ringer before you really get on track.
The cost per click in different countries can be very different. India traffic is usually considered lower-quality, and is usually much cheaper. My guess is that he saw a lot of India users not because its popular, but because that's what his budget allowed him to buy.
And by market I don't mean advertise. I mean, finding a group of people who really need inventory management and then tailoring your app to their specific needs.
For example, how many $1000s of dollars a year do restaurants lose from inventory spoilage? How does that compare with the cost of paying someone to enter all that data into your system?
Because, as a business owner, I only care about how your app is going to make or save me money.
One more thing. Not every type of business does well with a no-touch sales process. I suspect that with something like inventory management, you'll want to focus on an industry, go to trade shows, and really insert yourself into that world. Bizdev is really underrated in this self-serve world.
The website makes many grand promises but there is very little information on what it actually does. The target customer should be someone knowledgeable in Stock Inventory, but there are not many specifics for them to even assess if the product is for them or not.
* Who does this target? small businesses? retail? factories?
* What is a "sheet" really ? It is a Form? a data entry grid?
* Inventory data doesn't exist in a vacuum, it needs to be fed to accounting software, so at least a good import/export/reporting story is important here.
* similarly, can I connect to the database to produce my own reports and plug custom software (even Excel for instance through a datasource) to it?
* I can't find any information about cost management. Does the software only manage quantities or can it track cost as well?
* How does the software manage counting units? Can I manage cable lengths in metre or in whole roll? Can I sell some oil SKU by the litre and other by the bottle?
* What's the story for annual/continuous inventories (stock counts)? does it help me with that?
* Cant I easily make transfers from one warehouse to another?
* I can't find whether the software is able to manage FIFO, LIFO, batches, etc.
* What's the picking list story if there is one?
* Does the software manage part revisions? For instance factories may have different revisions of the same item (electronic or mechanical).
* Does the software manage stock locations so I can easily find where product with SKU F7786 is located?
* what's the story for receiving deliveries? Can I have a quarantine area where I receive my goods for inspection?
It reads everywhere that this is a one-man labour of love. Why should I risk an important business activity to a one-man shop? What happens if the founder is sick and there's a problem?
I don't want to be too negative, I'm only being harsh because I really like the concept; the design and the amount of work put into this is a short time is amazing. The tablet story is great too.
On the other hand, it feels like this was made by a programmer who doesn't really know the business he's in and ends up with a products that seems to be targeting libraries and bookstores (2 very different businesses) and groceries, retailers, even factories maybe. It tries to be too much for too many.
To save this, I would target specific markets and make appropriate versions of the software for those markets, using their business terminology, highlighting on the first page the pain points they are facing and how the software solves them, etc.
Making a one product fits all is exactly the sort of problem small business face when they buy a cheap general purpose ERP: it's often too complex and it ends up not being what they need. The pricing is also fairly high: a 4-seat version of Sage Line 100 (a complete ERP for SMB) costs less than US$900 per year in license renewal. Yours cost about $700 for 3 users only for inventory management. That's quite a lot.
You don't have a value proposition at all (let alone a good one) until you can answer Renauld's questions.
There's a reason there's 'endless menus after endless menus' - all the points you brought up (and then more). "Inventory management" as an open-ended "solution" is... near impossible.
Now... if we saw 'raka for automotive dealers', 'raka for gardeners', etc., it could be comprehensive enough for specific industries, but still able to be focused and simple. And perhaps all the flexibility could be there, but stripped away to leave focused UIs for niche markets.
I hit all these issues and more with a project a couple years ago. They really couldn't afford the 'industrial strength' inventory systems - simply too costly for them as a company - but had too many variables like the one you mentioned above. Just one small example - they'd record receiving various chemicals by the gallon or liter, but would record the use by... (IIRC) how many 'uses' (sprays, in this case). Without knowing how service person A had mixed their chemicals, 'one spray' could not tell you how much of the liter was actually being used. But they had to keep track of their chemical usage (I think for local permitting if nothing else) - during a stock take, there was no way to tell if people were using too much, or if some had been stolen, or perhaps was never delivered properly. And that some of that stuff was pretty expensive.
There's certainly a need for 'inventory management' for small business, but I think raka and others have to dive further and market focused niche versions to solve the needs of particular industries.
Or you kidding me? He wrote that "fourth months" after starting building his first business? And it was a failure because it hadn't made him rich in 4 months? Talk about perserverance...
Let me clarify that I'm calling it a failure not because I wasn't rich in 4 months. Instead, it's a failure to me because I lost interest in what it did and who it was for, and I had no intention of ever working on it again.
If enough people sign up it might be worthwhile to add additional features for premium users in the future.
It sounds like you have a reasonable product, but you've simply failed to sell/market it.
Also, try writing something other than dogfood, meaning some elaboration of software for an established, crowded market of which you have no specialized knowledge or expertise. 'Course, that would require you to have some life experience of something other than just software.