Thoughts on Open Source Communities

Supporting open source users seems like a thankless job. There have been many blogs written on this topic. Developers have stopped maintain popular projects because of the burn this causes. People who use open source projects, indirectly assume that they are entitled to free support, even if they have taken no effort to understand the issue, or tried searching for a solution.

Image by Andrew Branch

At some point, it becomes unsustainable for the original developers to keep helping without a return. At this point it is important for the community to come up with a good volunteer based model of helping new users. When the project hits a very large scale, like Ubuntu for example, you find enough people with expertise to answer such questions, so this problem can be overcome by scale. This assumes that basic housekeeping like building documentation continuously is being done.

When the project is moderately successful, (it has lot more users than volunteers), the developers have to keep supporting without any benefit, if they want to project to be successful. Specially if their livelihood depends on it. Of course after a point, the developers can push for paid support, but entitled users who expect free support will still bite if they don’t get the support they expect and bad-mouth about the project. This is a tricky phase.

Users waiting for help: Image by Paul Dufour

While it feels wrong to help anonymous users, it feels good to help people who belong to the community. As humans we feel happy when we are of use to somebody, but we feel sad when we think they are being exploited. While working on open source projects, its easy to move from one extreme to another. So how do we solve this problem?

One way would be to build a community and know the people in the community. So how do you define such a community? I think, a community is formed when people help each other to achieve a common goal. This means they invest time, effort, energy, money to help everyone else achieve this goal. When everyone does this, everyone benefits from each others’ investments and the community grows powerful.

Image by Clem Onojeghuo

So why would someone invest in being a part of the community? First the person has to be convinced that being in the community, that is giving back, is more beneficial than just being a taker. The process of contribution must be easy for someone who is new. It also helps that you feel that you are not being cheated by helping other users. This can be done if the benefits reaped by the community are fairly distributed instead of being cornered by a few. Another important thing is that there must be fairness in the way the affairs of the community are conducted.

A feeling of fairness comes when there is openness and transparentcommunication in the community. This also means moderating the communication so that the conversations are open, fair, focused and based on activities rather than opinions. Users who abuse the trust of others, or only keep taking (and not giving) should be discouraged or disbarred from the community. In online communities, people sharing their real identity, profile pictures rather than being anonymous, also makes it more human and friendly.

Image by Corrine Kutz

It is important that those who contribute to open source projects also be kind on themselves and do not burn themselves out. In the long run, open source is a great asset and win for everyone, but in the short run it is hard to sustain and keep the faith. The internet not only gives us tools to collaborate, but also to share the benefits and trade, and working in an open source community also feels specially rewarding.

But it need not be a hard slog just because its open. A little bit of balance can go a long way in making things fun.

Why Attend the ERPNext Conference 2016

The ERPNext Conference is an annual event where the ERPNext community of users and developers meet and share their experiences of how they use ERPNext and what they expect from the project in the future.

Attendees at the ERPNext Conference

ERPNext today is used by more than 3000 companies across the globe and is one of the few fully open source ERP projects remaining (there are no closed modules). Many blogs already list ERPNext as one of the top open source ERPs in the world. The case for ERPNext is simple: It is easy to install, easy to use, easy to maintain and actively maintained by an enthusiastic community.

By attending the ERPNext conference you will learn how organizations ranging from new age startups like Nestaway and Servify to age old institutions like the Royal Government of Bhutan and Believer’s Church have deeply embedded ERPNext in their processes. You will get first hand insights on how to leverage an open source resource in your organization and be a part of a forward thinking community.

Who should attend

  1. If you run any organization, you need an ERP to scale it. Running an organization is a complex job. Most likely you use multiple applications to manage your operations (accounting, sales, purchasing, payroll, help desk) with a whole lot of spreadsheets in middle. With ERPNext you can do all of this in one application with deep integration with all your processes.
  2. If you are an IT service provider, there are lots of opportunities around ERPNext to help companies implement, migrate, customize and develop on top of ERPNext.
  3. If you are a software product or services company, ERPNext can act as a powerful back-end platform, data source and admin interface for your company.

ERPNext’s core strength is the ability to customize, add your own forms and fields, scripts and formats. You can make simple REST API calls to add and get data from ERPNext to your other applications and easily configure alerts and make web forms.

A Foundation

What’s more, all this is free, as in Wikipedia free and there is no catch.

To make sure that this remains for a long time, we will be launching the ERPNext Open Source Software Foundation (approved!) at the conference. This will be a not-for-profit company (Section-8) that will be fully dedicated to the cause of developing, promoting and driving ERPNext as an open source project. Our for-profit entity will run the cloud hosting and other services and the project will be driven by the foundation.

Get Started

Technology is omnipresent. Today the difference between old and new economy has vanished. No one even uses those words anymore. The way technology is built and used has also changed. More people are collaborating on GitHub and other similar platforms than ever before. Even Microsoft agrees.

Your organization needs a strong technology backbone and it does not make sense to start from scratch or pay for something that is expensive and inflexible.

Join us for the ERPNext Conference on October 14–15 in Mumbai and see how you can transform your organization for the new age if you are willing to be open.

Meeting Product Startups #Ahmedabad

Over the last few months, I have interacted with a couple dozen awesome product startups in India as a part of product roundtables organized by iSPIRT, a non-profit industry group for software product companies in India. The roundtables that were in Pune, Delhi and Ahmedabad included around 8–10 product founders getting direct feedback about their products from their peers and experienced product founders.

The goal of this roundtable is to help software product companies gain more traction without doing sales. Sales is a great tool, no doubt. But if the product is designed in a way that it can be used without anyone’s hand-holding, then it can be used by a large number of people very quickly. The feedback from these users creates a virtuous cycle of improvements and more users. This has been the central theme of these roundtables.

Most of the products we saw were well executed. A cottage industry of SAAS applications and marketplaces is blooming all over India. Many of them have the potential to become sustainable and profitable businesses. The obsession is ofcourse about building the next unicorn, the billion dollar startup, but we will keep that on hold for now. If we are able to create an ecosystem with hundreds of successful apps, the unicorns will automatically emerge.

As a bootstrapped and sustainable startup, with a product that is more than 8 years old, we are probably only a few steps ahead of these young startups. Sometimes, you can learn a lot more from people who are a few steps ahead of you than those who are way ahead, so I am happy to share my journey with them. In the process, I have learnt a lot from these startups too and having interacted with so many of them. There are some themes that I have seen again and again that seem interesting.

Making good looking CRUD apps is a commodity

The state of web tools in 2016 is such that building a basic app that has CRUD (create, read, update, delete) functionality is very easy. The frameworks and design resources available can make your apps look professional and neat. A couple of devs can churn out such apps with reasonable polish, within a few weeks. Using contractors and themes, you can churn out good looking websites pretty fast too.

What startups need to think about is distribution. How will people know about the app? Why will they sign-up? Why will they tell their friends about it?

Sales is still the default option

Most startups still rely on high touch sales to get users. The good thing about doing sales is that you get first-hand feedback from your users. If you are a good sales person, and if you are persistent, you can convince the user to sign-up for your application too.

The bad thing about this is that you have no idea what a user who has no context about your product thinks about it. You have no idea of easy or hard it is to start using your app instantly. You cannot reach out to users who are not in your network or timezone. And doing sales is expensive and not scalable.

To build applications that get customers without sales, products need:

  1. Great copy on the website that makes it extremely easy for someone to understand what the product is about.
  2. Automated, instant, no-hassle sign-up.
  3. On-boarding workflows.
  4. Online help with videos and documentation.
  5. Excellent product usability and quality.

Often, these projects are as daunting as building the original app, if not more. Often this is what takes time and is largely under-estimated.

Standing out, communicating clearly

Very few of the products we saw were memorable in terms of their marketing and communication. Since we live in the internet era where we are exposed to the best quality of content, it becomes even more important to be memorable and interesting. As the branding and design great Stefan Sagemeister puts it, “Everyone who is honest is interesting”, companies need to be a lot more honest about who they are and why they do what they do.

The best example I can think of is Basecamp. They have set the standard of how companies should communicate about themselves. Companies can use a lot more authenticity and their personal stories a lot more. Using stock images with caucasian models just does not cut it.

Closing

It has been fantastic communicating with these startups and the credit of making this happen goes to Avinash Raghava and iSpirt. Doing grassroots work is always hard and unsexy and not very visible, but is very necessary if you want to create a lasting change. It has been awesome to interact with Niraj and Pravin, two awesome product thinkers with whom I have conducted these sessions.

I wish I had access to such mentoring when I was starting off few years ago, and I am excited about the future sofware products that are coming out of India.

Open Source and SAAS

While open source software is a fairly well understood in concept, I am always surprised how little it is understood in practice. At a round table of young product companies last month, there were a lot of raised eyebrows and questions when I explained our open source way of working.

Jordan Hubbard, co-creator of FreeBSD and open source veteran, spoke on this topic at this year’s ERPNext Conference, and he basically said this, open source business is all about people. Since the product is free, you sell services around the product, which is your people. This is mostly true for the very large majority of businesses that have mushroomed around open source projects, providing installation, hosting, customization, maintenance and other services around the product.

But there is now a new variable in the equation, SAAS (or Software-as-a-Service). It has been already accepted that SAAS is the way software is sold today. Listed companies like SalesForce, Xero, Zendesk, Workday, NetSuite, Hubspot, Shopify are testimony to the success of SAAS products and the billions of dollars that get spent on SAAS products each year. What does the future hold?

As on-premise is slowly moving into SAAS, I believe that SAAS itself will move into open source. Since the unevenly spread future is already here, there are companies already successfully doing open source + SAAS like WordPress, Ghost CMS, Magento, ERPNext (disclaimer: that’s us).

Open source + SAAS makes a great combination.

Benefits to the user:

  1. Open source products allow virtually unlimited possibilities to deeply integrate the product.
  2. There is a lot more risk in a closed platform, like price increase and slow pace of development.
  3. There is no vendor lock-in
  4. Free!

Benefits to the publisher:

  1. Not everyone wants to host their own infrastructure, this opens up opportunity to build a SAAS platform
  2. Provides word-of-mouth marketing
  3. Vibrant community attracts more users
  4. Community contributes by providing feedback, support, features, fixes, integration, testing, documentation
  5. A lot more incentive to write good code and documentation
  6. Much easier to find and on-board new developers to your team

Going open source is not easy. Business are built on the premise of transactions, and in open source, you have to be very open to giving and communicating without expecting immediate results. But once you cross a certain threshold, community participation can be extremely rewarding.

I am not advocating you open source your product today, but as Wikipedia has shown us, its only a matter of time before someone builds a mature open source product that might replace you.

Then there is no going back.

Getting Traction for Product Startups #Pune #PuneConnect2015

This PlaybookRT will focus on “Getting traction for Product Startups“.  The PlaybookRT is facilitated by Rushabh Mehta(ERPNext) & Niraj Ranjan Rout(GrexIt/Hiver) and will be done at PuneConnect 2015

A Brief Overview

– Startup phases: All startups go through similar phases. A useful framework can be the chart that is put-up at Y-Combinator showing the different phases.
– Market segments: Product has to wait a long time before it goes from early adopters to mainstream users (Crossing the Chasm)

Demos and Feedback

– Each founder will do a 5 min demo and show their website and share what is their current problem. We will ask them to fill a questionnaire before hand so that we can identify what the problems are like with -> age of the company, market, differentiation, positioning, churn, cost of customer acquisition, etc.
– Everyone contributes based on their experience, gives feedback on the demo and shares what can be done with the website – content ideas, positioning, messaging.
– Share best practices, see what successful companies in the domain have done to overcome this problem.
– Each participant gets 15 mins-20 mins focussed attention and they go back with a concrete set of suggestions.


Conclusion

– Each founder goes back and shares with the focus group after one month, how did they implement the suggestions and what was the feedback.
– The focus group can then meet again or discuss over mail.

Benefits

– You get specific suggestions to the problems you are facing or you will validate / invalidate your current assumptions.

Playbook-RoundTable is one of the most sought after community events of iSPIRT. It’s a gathering of 12 like-minded product startups who are beyond the early stage. RoundTables are facilitated by an iSPIRT maven who is an accomplished practitioner of that Round-Table theme.

Registration and Pricing
If you are keen to attend this RoundTable, do let us know by filling in your details here. We will confirm your seat subject to availability.

All RoundTables are conducted pro-bono. They only payment you have to make is to provide your undivided attention and active involvement in the process. Playbook-RoundTables are a dialogue and there’s no monologue. None.

Why You Should Attend the ERPNext Conference

In year 2000, Apple was lagging far behind Microsoft’s Windows Operating System and it seemed there would be no way it could catch up. In a brilliant and desperate move, Apple decided to build its next generation operating system using the best open source technology available at the time. Steve Jobs hired Jordan Hubbard, the co-creator of FreeBSD, a popular Unix distribution and a well known open source hacker to help build the best and the most secure operating system based on open source software. At this ERPNext conference, hear from Jordan how open source helped a company like Apple to build and commercialize some of the best technology we can use today.

Open source is the technology success story that few people talk about. Today the most trailblazing technology companies are not only dependent on open source, but are active contributors to it. Companies love to showcase their open source contributions not only to attract the best talent but also to build infrastructure components in a collaborative manner. And that is not all. Using open source allows companies to dive deep into their technology stack and integrate their processes to a level that is not possible with proprietary tools. And we have not even talked about the cost savings.

Along with Jordan Hubbard, you will hear from one of the most popular open source projects run out of India. Kovid Goyal was a graduate student in the US when he built an e-book converter for his use which he called Calibre. Kovid is now based in India and works full time on this project. Today Cailbre is actively used by 3 million users across 200 countries. Get to hear about this amazing journey from the author of Calibre and his views on how open source is helping millions of people use e-books without being tied to proprietary platforms.

By coming to the ERPNext Conference, you will learn how open source can transform your organization. If you ever had questions that you wanted answered, this is the event to come to. These are some of the questions you will get answers to

  1. How using Open Source will benefit my organization
  2. How are Open Source projects sustained
  3. Is Open Source software well designed.
  4. Can I get professional quality support for Open Source?
  5. Is is safe to use Open Source?
  6. Are Open Source enterprise tools mature?
  7. What is cost of using open source?

erpnextApart from this, there will be talks by ERPNext users and developers that will help you:

  1. Evaluate how ERPNext can benefit my organization
  2. Learn about the features of ERPNext
  3. Learn why ERPNext is one of the best designed enterprise applications available.
  4. Learn from other users of ERPNext
  5. Evaluate the state of the ERPNext project
  6. Learn how ERPNext can be extended and customized
  7. What is the process of implementing ERPNext

So if you are using Tally, Quickbooks, Sage, Microsoft Dynamics, Oracle, SAP (god forbid), you are really paying too much and getting too little from your current enterprise software.

Seating is limited, and registration is required (and will include lunch). So register your seat today.

Service Oriented Startups

Last week a very interesting free e-book called “Software Paradox” was trending on Hacker News. The premise of the Service Oriented Startupsbook is, that the value of software as a product is diminishing, but the value of software as an enableris rising. Pure play software companies such as Microsoft and Oracle are fading in comparison to rising stars such as Google, Facebook, Apple, Amazon and newer ones like Uber, Dropbox, GitHub, AirBnB and others. None of the new age companies sell “software”. They all sell a service (or devices, in case of Apple).

The book goes on to argue that companies even prefer giving away their software innovations as open source so that they can get the respect of the developer community that they desperately want to attract. Apple’s operating systems are based on an open source flavour of Unix, GitHub has built a social layer on git, a version control system created by Linus Torvalds and Facebook is a leader in new age open source web development tools. So there is a clear trend of companies collaborating on an infrastructure and tool level and yet being able to create a lot of value in the services they provide.

They book suggests what pure-play software product companies should do in order to survive this next wave. There are a lot of great options described which range from moving to a subscription model to becoming a full-stack startup (doing very deep vertical integration in the markets they operate). In the context of pure play software product companies, where do we in India stand?

A defining moment in the first episode of the new YouTube drama TVF Pitchers, an Indian take on the popular and brilliant series from HBO, “Silicon Valley”, is when the protagonist is about to dump his entrepreneurial dream and continue with an overseas posting. On his way to the airport, he sees large advertisements of Housing.com and Snapdeal and decides that his calling is a startup. On a side note, it is interesting to observe that the innovation described in TVF Pitchers is a “B-plan”, whereas the innovation on which HBO Silicon Valley is based, is a hypothetical “algorithm”.

My conclusion is that India has already leapfrogged to “Service-Oriented Startups”. The number of new startups and deals in the e-commerce and classified marketplaces domains greatly out numbers startups that have a technological innovation at the heart of the business. The aspiration of the entrepreneur who starts up today is to build the next Flipkart, not the next Google.

This is something we all will have to learn to accept. Like so many modern innovations we love using today are ones we did not invent, software is something we will rather use. Innovating on technology requires an intellectual rigour and ecosystem support that will probably never reach a critical mass in India. But amidst all this gloom, I still have hope that at least a few of the 3 million software developers out there will prove me wrong.

Understanding Software Sales from the Tally Experience

It is safe to say that Tally is the grand daddy of all Indian Software Products, the only company to have discovered the holy grail of selling software to Indian small businesses at scale. So when one of the key architects of the Tally sales network, Deepak Prakash (Tally employee #3) came down to Mumbai to do a iSPIRT Roundtable, there was little chance I would miss this. And Deepak Prakash did not disappoint. In typical Delhi banter, Deepak walked us inside the mind of a top performing sales executive and how the goals of an entrepreneur and sales person, while contradicting from the outside can be wonderfully complementary if managed right.

2015-03-14 14.29.14 HDRIn the era of online marketing and social media, old world sales seems like a relic of a bygone era. But not in India. In a country full of contradictions, traditional sales still has its charm and companies that want to sell in India, must understand the nuances.

Empathy

The most recurring theme Deepak’s talk was Empathy. The ability to listen and ask good questions. This applies to both, the relationship between the customer and the sales person and the sales person and the entrepreneur.

Deepak talked about the importance of knowing the sales person and making sure their aspirations are aligned with the company’s aspirations. If the aspiration of the sales person is to buy a car or buy a house, then the person must be able to see that this job will be able to fulfil these aspirations. Aspirations of changing the world have to be translated to the sales person.

Being in sales is a crushing job. Most of us a wary of sales people and feel they are intruders. Hence it is very important for someone who is managing a sales team to constantly boost the ego of the sales person, It helps to keep up the “shabash” and back slapping. If the sales have not been good, its not a good idea to bring it up the first thing in the morning. Mornings should be positive. Its best to have an evening call and close the day’s issues.

Productising Sales

Once the sales process is stable and repeatable, it is important to standardize it. Deepak calls it productising the sales. Getting the words right is very important. It is necessary to always talk in the language of the customer. While calling the customer to renew, saying that “their account is going to ‘expire’” can send wrong signals. Avoiding use of jargon, having a clear pitch and script was at the heart of the sales process. A good sales person is always well prepared should never be in doubt of what to say in any given situation.

Strategy

One of the key learnings for most of the fellow startups was market segmentation. Deepak shared to attack  a new market. For example if you  were targeting automobile dealers,you  would first have have your own sales people break into 10% of the market and once the network effects started, i.e., you will  have enough references and word of mouth going, then you  start handing it over to a reseller or partner network.

In Deepak’s words “you should  eat the elephant, but piece by piece”

Channel Building

A point will come when it will be  impossible to keep growing the sales network. Not only will it be  expensive, it will  also difficult to manage large sales teams. Hence it imperative for you  to start building a partner network. On being asked, when was the best time to start a partner network, Deepak answered, when there was a repeatable (productised) sales process.

International Expansion

There were many other topics Deepak touched upon like hiring (good sales people are great listeners), Tally’s approach to piracy (don’t inconvenience the customer), managing targets, bringing in influencers (charted accountants in case of Tally) and being clear of what you want (Tally was clear they did not want to go for enterprise customers).

Some of Deepak’s stories reminded me of the Jagdeep Sahni scripted “Rocket Singh, Salesman of the year”, which I think is a brilliant, highly underrated Indian movie for startups.

The Key to selling software to SMEs in India

One of the things Deepak wanted to share with the startups, something that Bharat Goenka, the founder of Tally has also spoken elsewhere, is that the buying patterns of small businesses in India are like enterprises in mature markets. They are used to being sold things rather than they pro actively going and buying stuff. Deepak wants to warn software companies (and their VCs) that they need to plan for scale (more than 10,000 customers). This is not a market for half measures.

My Take

While the session was delightful and insightful, I don’t think startups should try and emulate what worked for Tally. Tally was a product of an era where there was no internet and software adoption was in its infancy. They succeeded because they had the right strategy, risk apatite and execution for the market they wanted to succeed. Also once they hit critical mass, the role of the sales person was only to ensure availability, because the customer already knew they they wanted Tally.

11063806_10152785041892794_1847266351215314437_nThere is a reason the roles of travel agents or insurance agents is shrinking every day. The internet is a wonderful for discovery, learning and distribution of software and startups should go on this path. While sales may be necessary for enterprise, it is too expensive small businesses.

We understand that today, the Indian small business may not be ready to buy without being sold to, but this is changing fast. We are happy to wait and perfect the online game, so that when the markets open up, we have to most compelling offering ready.

Global Lean Sales – Selling your software online to global markets, without field-force #PlaybookRT

Last week I was going through the startup class videos and one particular statement by Sam Altman stuck with me. He said “All successful founders are fanatics”. And YCombinator has seen a whole bunch of them. The way he puts it is very awesome, let me reproduce the statement here:

“The word fanatical comes up again and again when you listen to successful founders talk about how they think about their product. Founders talk about being fanatical in how they care about the quality of the small details. Fanatical in getting the copy that they use to explain the product just right. and fanatical in the way that they think about customer support. In fact, one thing that correlates with success among the YC companies is the founders that hook up Pagerduty to their ticketing system, so that even if the user emails in the middle of the night when the founder’s asleep, they still get a response within an hour.Companies actually do this in the early days. Their founders feel physical pain when the product sucks and they want to wake up and fix it. They don’t ship crap, and if they do, they fix it very very quickly. And it definitely takes some level of fanaticism to build great products.”

Read the full talk here (later)

2014-10-18 15.23.57

This statement came alive for me yesterday when I met Pallav Nadhani, the founder of FusionCharts. As he walked us through how he built his company and sharing his experiences and wonderful insights in building his company, his fanaticism was apparent. I am sure everyone who was there, wanted some of it to rub on to them. Even though it was a “RoundTable”, I think Pallav had more experience than a lot of us and pretty much carried the group. He shared some very cool insights, with real life examples and actionable suggestions.

There were 11 of us, all selling business-to-business (B2B) products in the range of $1000 – $75,000, some online, some offline, most on a subscription model, some early stage, a few past the validation stage. Almost half of the founders depended on high touch sales and half had products that were Do-it-yourself. Here is a summary of the meetup:

Pallav’s Story

Pallav shared his story on how he started the company when he was 16, to get some pocket money. He made a charting widget for himself and then wrote an article about it, which became popular. Then one thing led to another and he now runs a company that publishes 90+ types of charts has 23,000 customers and 70 people. Some of the things that he focused from very early on was:

  1. Reduce all friction for the user who is evaluating the product.
  2. He promised his users that they would get their money back if they could not build the first chart in 15 minutes. That helped him simplify the on-boarding process and make it very easy for his users.
  3. He was a one person company for a long time and handled everything from developing the product, documenting it to doing customer support.

Documentation

Pallav’s father is an author of 15 books on accounting and that gave him a strong foundation to document his product very well. This was particularly important since his target audience was developers who needed good documentation to use the product.

  1. Pallav himself wrote 3000 to 4000 pages of documentation and still reviews every word that is added by his team.
  2. Documenting the product gave him key insights as a user and helped him refine and debug the product.
  3. Every time someone asks a question. His team is forced to answer using a public document. This made sure that the same question did not get asked again and also created a good knowledge base for his product.
  4. He learned from his father on how to structure documentation (with headings, sub-headings etc) so that the reader can quickly find out the relevant sections to read.

There is another interesting anecdote. jQuery was a late entrant to javascript libraries and according to its creator John Resig, it was because it was the first one that was properly documented.

Marketing and First Impressions

Pallav’s hypothesis is that all sales / conversions are driven by “Fear” or “Greed” and products must highlight these in their marketing copy, specially the headling. He even asked all of us the rephrase the core message of our product to appeal to one of these emotions. I had strong reservations on whether this was correct and if this lead too to much focus on top of the sales funnel (new visitors). Either way, the group seemed convinced. While I thought it went went with Pallav’s aggressive and “switched-on” approach, I have my doubts if it works for all kinds of products. Products have the personalities of their founders embedded in them, and I feel its best to stick with the approach that goes best with the philosophy of the product and the creator.

Pallav also referred Kevin Hale’s analogy of building a customer relationship like a marriage and how the first visit of a customer on the website is like dating. For more on this, I would recommend Kevin Hale’s enlightening talks on the matter (later!).

Some other interesting points that were discussed were:

  1. Classify your traffic into different personas. For Fusion Chart, it is the Developer, Product Manager and Designer.
  2. Deeply understand each persona. Appreciate that they are overloaded with information and identify openings in their daily routines where you can reach them.
  3. For security startups, a weekly roundup of major reported breaches worked well when sent at 8.30 in the morning.
  4. Online marketing has evolved from “carpet bombing” to “sniper”. Audience have to be segmented and messages have to be finely targeted.
  5. It is important to reach the users main Inbox and not the promotions box. So keep the mail personal and do not add an unsubscribe link.
  6. Pallav showed how he used WebEngage for conducting surveys on their visitors and how he tested his hypothesis. For example, his survey would ask if a visitor intends to pay for the product on offer or select an open source alternative. Based on the feedback, Pallav said he would change the marketing copy.
  7. He also used VWO for A/B testing and showed us an example on which one of “HTML5 Charting” or “Javascript Charting” resonated more for the user.
  8. Asking feedback from customers who had evaluated a product was also important. A simple email with the subject “5 minutes of your time for 5 questions” gives Pallav great customer insight.
  9. He said he tests all kinds of hypotheses and keeps experimenting on the message. Examples:
    1. Do users like a simple or complex layout
    2. How many fields should a form have
    3. What colour a button should have

The attendees at PlaybookRTContent Marketing

We spent a whole bunch of time discussing and sharing great insights on Content Marketing. Sahil Parikh of BrightPod.com shared his experiences in content marketing. He has built a product for the marketing community and started a blog with the purpose of reaching out to this community. It took him six months of building the blog before he saw some returns. He has hired two content writers and produces 3 to 4 blog posts a week. He shared that aggressive content marketing teams target producing one post a day. He also reached out to Indian authors on popular blogs like ZDNet and TheNextWeb and pitched the Indian product angle that got him attention. Sandeep Todi of Emportant.com shared that he bumped into a content writer for SiteHR, a popular HR portal and is how working with her to build content for his product.

Content marketing seemed like a favorite of strategy of a Lean Sales team but again it boils down to execution. It is very hard to product high quality content and as more and more people start getting good at it, the bar keeps on increasing.

Some content ideas / anecdotes shared were:

  1. Interview / Talk Show Series: Publish interviews with customers and thought leaders in the domain
  2. Use big brands in your blog posts. Examples from Fusion Charts:
    1. How Unilever / Walmart / P&G uses data visualization
  3. Act on industry events:
    1. Security Breaches
    2. Flipkart Billion Day flop
    3. Home Depot breach
  4. “News Jacking” – Connect popular news items to your product.
    1. GangamStyle in numbers
    2. Infographics on FIFA World Cup
    3. 10 infographics on Fitness Apps
  5. Put customer logos on your site, content unless the customer objects. Don’t mention it in your contract or it will trigger a red flag.
  6. Allow your site content to be reproduced.
  7. Curate, collate good content from other site and credit the original author.
  8. Get quotes from industry influencers, the will also ReTweet your content.
  9. Speed is of essence. Create great content quicly (yeah right!).
  10. Publish whitepapers. They are popular with higher management.

Sales Funnel

Pallav walked us through the various parts of the sales funnel.

[From his slides]

  1. Awareness (ads, blog, event, word-of-mouth…)
  2. Initial Visit
    1. Different channels / different ROI
    2. Best channels = low cost, high ROI
  3. Engagement
    1. Trial, case study, whitepaper, anything that could give you email AND other information
  4. Nurturing
    1. Mix of product, marketing and sales
    2. Sales job: get the customer on the call and do aggressive follow up
  5. Closing
    1. Handover from sales to client success.
    2. Repeat business through subscriptions, up-sells or cross-sells.

Pricing

There was a very heated discussion on pricing. Pallav was of the mainstream industry opinion that price is a reflection of value. The higher the price, the better the quality of customers and revenue. There was a discussion on discounts and how in high touch sales, discounts are a bane. Here Pallav shared that adding artificial constraints to negotiate. For example, you can extend the support by 3 months instead of giving a discount, or increase the number of servers etc.

Open Source

There was some resistance and suspicion from the group in discussing this and understandably so because of the nature of the software products business that depends on Intellectual Property Rights. We did touch upon this briefly and why based on our (ERPNext) experience we see open source as a great way to not only reach out a new generation of users but also believe in an alternative way of doing business.

2014-10-18 15.24.15Conclusion

It was great to learn from Pallav, and we thank him for sharing so many suggestions and learnings. Also a big thanks to him for openly sharing specific insights and walking us through an A/B test or testing an hypothesis. This is also a great initiative by Avinash Raghava and iSPIRT, the think-tank/lobby group for Software Products to bring together entrepreneurs so that they can share tips and build networks. It would have been a bit better if there was more unstructured time so that there would be better interaction between the group, to build deeper relationships between the founders. Also a big thank you to FreeCharge.in for hosting the event and providing lunch.

Finally what really matters is execution. For me the biggest takeaway was that the product is a reflection of the creator / founder and it was important that the founders are obsessed with each detail of the product and its quality and also work with the energy that is required to do so much work. For that it is important that they see success early on as Pallav did and the once they are on to something they make sure that they do not lose it.

Specifically, for me it reminded me that its time to go back to fixing the documentation!

“Bootstrapping is tough. Most of the time things take three times longer than what we think. The only way to enjoy this journey is to absolutely love what you do. That is what sustains you.” – Rushabh, ERPNext

Continuing our journey to bring to limelight bootstrapped entrepreneurs from India, we got a chance to speak with Rushabh Mehta, Founder of Web Notes Technologies, a software product company that publishes a free and open source web based ERP called ERPNext for small and medium businesses. Built by a small team of 8 people, ERPNext has more than 250 paying customers and has also been included in Winners List of BOSSIE (World’s best Open Source Applications of 2013) Awards. Here is the transcript from the interview:

Tell us more about the journey of starting ERPNext. 

I have been a software hobbyist, coding and developing software for fun since my school days. I graduated with a Masters in Industrial Engineering from Penn State University, US in 2004 and soon joined our family business. At that time the business was undergoing a transformation and we were trying to set up a custom ERP system to integrate Sales, Purchasing, Inventory and Accounting. I took ownership of the implementation and that experience gave me the first taste of ERP platforms.

Soon after that experience, I started a services company with a friend and delivered multiple software projects for clients but that journey didn’t continue for long as my heart was in building products. I shut down the venture and moved on to start Web Notes Technologies in 2008 to build a free and open source web based ERP product.

How did you fund the business while bootstrapping? Did you ever consider raising capital from investors? 

During the time when I was starting Web Notes, my family exited our family business and had some funds in hand. I borrowed some of those funds and that gave us the initial breathing space. We also delivered services for few initial years to keep us going.

Once we decided to focus only on building products, we took many measures to sustain ourselves financially. We brought our team size down from 18 to 5. It was a difficult move but was essential to ensure we don’t burn out quickly. We also removed sales and marketing and instead focused all our efforts on product development. We hired fresher graduates to keep the salary expenses under control.

I did try raising funds but due to the nature of business, was not very successful. ERPNext is a specific mission critical product and it was not that easy to find a good market fit in the start. Also there weren’t many companies in the same space to compare us with. All this made the business not seem that attractive to investors.

How did you build your team at a stage when revenues had not started flowing in yet? What motivated those people to join you? 

Most of our initial team joined us because of the work we were doing. We were building an open source product and that attracted people to join us as there weren’t many such opportunities available elsewhere. On a funny note, one person we interviewed also said that he checked our website and got an impression that we are a large firm! Probably having a good face online helped. Ha ha .

The initial years were quite difficult. We didn’t have any mentors and were not sure what to do next. We got all our feedback from customers and learnt how to build quality software. As Malcolm Gladwell says, success in any field comes when one invests 10,000 hours on it. As a team, we are walking through that journey of 10,000 hours and falling down and learning in the process. This journey is what keeps us together. Our initial 5 hires are still with us and that says a lot.

Marketing is another area that requires a lot of investment. You have reached 250+ paid customers with zero marketing and no sales team. Tell us more about how you managed marketing.

Information asymmetry is reducing fast. Now, there is no need to take the help of traditional media. If the product is good, word does go out. “Viral” is the new buzz word.

As a bootstrapping company, the marketing options are very less. In the initial days, we set up stalls and booths in different exhibitions and events to reach out to customers. We received our initial feedback from there and reworked on the product. It has been a slow and organic growth for us. But we were clear that we never wanted to push our products to customers. Once we gained some initial customers and delivered quality products, we got referred to new customers and the chain continued.

The open source aspect of our product also attracted many customers as there were not many open source ERP products in the market. Our competitive pricing was another attractive factor. ERPNext is available at 30,000 INR/ year and most customers usually have a budget 10 times that amount. Since we are focused on quantity i.e acquiring large number of customers, this low price strategy really helps us get the foot in the door.

Another advantage VCs bring in is the guidance on building the business. As a bootstrapped company, how did you make up for these? 

As a bootstrapped company, we are left on our own. Not having mentors was an issue. I do feel we lost a few years. However, I have been trying to learn from each and every source I get my hands on. I read blogs, hacker news and also learn from other companies. For example, we are highly inspired by the design, philosophy and writing of 37signals, not to mention their products which are just amazing. We think that they, and not SalesForce, are the true pioneers of web applications. We love the quality, reliability and technology of GitHub, which has re-invented the way Open Source software is written and shared on the Internet. We try to learn from the design, quality and vision of Apple. They have set the benchmark of engineering and we hope we can understand and use some of their focus and attention to detail. And last but not the least, WordPress (and Automattic, the company behind wordpress) has provided us with a template of how an Open Source business should be built. Whenever we are in doubt in terms of taking business decisions, we find asking ourselves, what WordPress would do. There is no dearth of inspiration. One just needs to look around. These and many such companies have been our mentors indirectly.

Looking back do you think you should have raised angel or VC capital instead of bootstrapping? In what way has bootstrapping worked in your favor and what opportunities do you think you missed out on because of not raising external capital? 

There is no right way to answer this. Both bootstrapping and raising external funds have their own advantages.

Because we followed a bootstrapped journey, our confidence is very high. We have gone through the whole process of transforming into a matured business. We are able to judge things better as we have seen the extremes. And we still have our independence.

On the other side, we do fell that as a bootstrapped business, we often miss out on the glitz and glamour that surrounds the well funded businesses. We also miss the whole package that comes with investors – the funds, contacts and advisory.

But at the end of it I feel that in the current world there is so much a single person can do without any external help. Take the example of Salman Khan of Khan Academy. It is so inspiring to see the way he has built his business single handedly. He did not employ an army of people to make his videos. He created close to 3000 videos, using his own personal skills and technology. Nowadays there are so many tools available that eventually capital driven growth might become irrelevant.

We are proud to say that over the last 3 years, we have been growing 100% every year in terms of revenue and we have reached this stage purely bootstrapping our way up.

ERPNextFrom your own experience, what advice do you have for start-ups who are currently bootstrapping? 

The key question one needs to ask themselves is how they are going to sustain themselves as they are clocking their 10,000 hours towards building their product.  It could take 3 years or could also take 7-8 years. Most of the time things take three times longer than what we think.  There is no magic bullet and one is not going to get discovered on their own. They need to take one step at a time.

The only way to enjoy this journey is to absolutely love what you do. That is what sustains you.

————————

As I spoke to Rushabh, I could sense his enthusiasm and passion towards his product. Their team sure is deriving their inspiration and learning from other companies but it is not very far when they are going to inspire others on how to bootstrap and build a successful business from scratch. ProductNation wishes Rushabh and his team a successful journey ahead.

 

Redefining Enterprise Software with Open Source

Everyone knows that Enterprise Software is bloated with un-necessary fat. And the fat shows clearly in the way sales happens. In the latest book by Venture Capitalist Ben Horowitz, he shares a story where in order to please a customer, they went and acquired a company, whose product was liked by the purchasing manager, so that they could bundle its software with theirs and win the contract. So clearly politics wins and the product is something that is incidental. I assume a whole bunch of million dollar deals happen like this. I have personally heard a story from from a smart sales person who sold a software worth Rs 1cr to a very large Indian corporate house and that software barely was ever used. I knew he was not bluffing because the purchaser, a high ranking corporate manager was standing next to him. Relationships sell, not products.

Contrast this with Consumer Software Products. Apple sells a beautiful piece of hardware (a computer + phone) and a complex operating system with amazing design for just $600 and makes 39% margin on it. I am sure the software that goes in the iPhone is worth thousand times more and is infinitely more complex than the piece of crap sold by Ben Horowitz or the smart sales guy. The difference is only in the volume. Given enough volume, great software need not be bloated or expensive. This gap between consumer and enterprise software is what ERPNext plans to bridge.

With ERPNext, we are going one step further. Not only are we pricing the product way below the market but also giving it away for free. To remove the fat, we did away with our entire sales team and started to make it easier for our customers to download and use our product for free. What this has done is that it has given us traction and a community. This community is our marketing engine that has consistently taken the ERPNext brand forward and we take pride when ERPNext is proposed as one of the “mature” open source ERP on third party forums. Whats more, this strategy has attracted sponsors who have volunteered to pay us money to accelerate the development.

Being an Open Source product, opens up opportunities that are usually not accessible to proprietary products. Software vendors and partners are already bundling ERPNext along with their offerings and plugins are being built. As the publisher, our focus is on continuously improving the quality of the product and helping the community with deployments and functional help. We so much diverse feedback, it is only natural that the product keeps improving.

To take this platform to the next level, we are hosting a conference in Mumbai on September 25th where we plan to bring together users, developers and partners to brainstorm ideas and identify opportunities growth. We would also like to invite the larger Indian software ecosystem to participate in this community driven and open source project.

To register for the conference, please go to the ERPNext Conf. site.