[00:00] Mike: This is Startups for the Rest of Us: Episode 110.
[00:11] Mike: Welcome to Startups for the Rest of Us, the podcast that helps developers, designers and entrepreneurs be awesome at launching software products, whether you’ve built your first product or you’re just thinking about it. I’m Mike.
[00:19] Rob: And I’m Rob.
[00:20] Mike: And we’re here to share our experiences to help you avoid the same mistakes we’ve made. How are you doing this week, Rob?
[00:24] Rob: I am doing good. I’m winding down for the end of the year. I’ve already noticed a lot of my ads are not being clicked any longer [Laughter] the ones that that worked for the last several months, just noticed lower traffic, lower engagement, lower trial sign ups even on the traffic. I mean it really is a noticeable down turn.
[00:40] Mike: Uh huh. That’s interesting because I’ve…I’ve seen sort of the same thing with some of my sites but interestingly enough, I’ve had a couple of different customers contact me about the Altiris Training site that I have. And one of them told me flat out, “Hey, I’d like to look at your enterprise plan and if it looks good, then I’ll sign up and I’d like to issue purchase order for the full…for a full 12 months.” And I was thinking about it. I’m like, huh, I bet he’s got money to burn in his budget and he’s got to get rid of it before the end of the year and he’s looking for a way to dump it.
[01:12] Rob: That’s exactly what it is and that was the other thing. It’s both for budget and for tax purposes and I’ve already seen a couple e-mails of people saying, “Hey, can I pre-pay for a year in advance of this or that?” People asking about just some of the specials. I mean I did run some…we’ve…you and I ran some specials and then I ran some on my own and I got a better response that I thought I would. I like to think of December as kind of B2B stuff dying down. But there is definitely an angle here in terms of like you said budget and tax reasons. So, I’ve actually made a note to think harder about this next November.
[01:45] Mike: Well, I wonder if part of it is because the whole Fiscal Cliff here in the U.S. were tax rates are set to go up next year and nobody really knows what’s going to happen. So, because of all that uncertainty, they know how much they have to pay on their taxes this year. At least they know what the rate is but almost across the board, it’s going to go up in many cases by at least 5%, if not more.
[02:06] Rob: Right.
[02:06] Mike: So, I wonder if that has something to do with it. I wonder if you would see the same thing next year and I suspect you wouldn’t.
[02:11] Rob: Yeah, that makes sense because I’ve run a special…pretty much every December, I run specials almost across the board with all my businesses and I do like a prepaid special or you know, something where you can buy out ahead specifically for the tax reason and it hasn’t been as…I wouldn’t say it hasn’t been as successful as this year but it certainly hasn’t…there haven’t been as many people asking for it outside of that. So, I think you could be right because they all have been U.S., you know, U.S.-based companies or people who’ve been contacting me.
[02:38] Mike: Uh huh.
[02:38] Rob: How about with you? What’s going on?
[02:39] Mike: So, lately, I’ve been looking at Basecamp and FogBugz and trying to not necessarily integrate them but make sure that I’m using both of them effectively, to coordinate people who are doing on…doing different things for me and it still really early on it. I’ve been living…brought Basecamp in to the fold probably about a week ago. So, it’s still kind of a learning experience. Things are coming along. I bought its specs. I mean it’s a little bit slow. I wish things were going a little bit better. But I have seven different projects in there that I’m trying to manage and different people are involved and different projects on various levels. Right now, I’ve got five different people who are involved in the AuditShark launch projects. So, they’re still kind of counting down for that. But things are looking good for it so far. I mean I’m really happy about how things are progressing to kind of get it out the door and get it in people’s hands to really see what people are thinking of it.
[03:27] Rob: Right and that you’re still looking at mid January for that?
[03:30] Mike: Yeah.
[03:30] Rob: All right, cool. Now, we look at using…I already use FogBugz to navigate and coordinate and track features and tasks and such, someone suggested…someone on my team suggested we should look at Basecamp which I’ve used in the past and it’s okay. I mean FogBugz is not outstanding but it’s just…it’s what we use, right? So, it’s like the…the shifting cost is high so really has to add a lot to it in order to move to Basecamp or to use two tools. And we looked at it and decided that we could get done what we need to in FogBugz or with…with the new project with Drip, we have the…it’s the old Joel Spolsky project tracking spreadsheet. Remember? It’s genius. And I’ve…that’s what I used as a consultant when I was coding for years. I mean even with multiple teams we would share an Excel spreadsheet which is kind of kludgy but now, it’s a lot easier with Google doc. We decided not to use Basecamp. We’re using these other…these other avenues and so far, they’re working really well. So, I want to find out what you’re doing in Basecamp that you can’t do with FogBugz?
[04:26] Mike: Part of it is about just the cost of giving everybody access to FogBugz because, you know, I have people who are using Basecamp who are not developers and it seems a little excessive to be having them…to give them access to FogBugz when I have to pay for both Kiln and for FogBugz. So, it’s…you know, it’s $30 license per month and not everybody is working all the time.
[04:47] Rob: Right.
[04:47] Mike: And that’s the other issue is like, you know, sometimes I’ll have one developer, sometimes I’ll have five and it’s like the fluctuations are kind of pain in the neck. With Basecamp, I don’t have to worry about it. It’s just like, oh, you get 10 projects for 20 bucks a month. All the people who are doing stuff that is non-developer related, they basically use everything that’s in Basecamp and the people who are doing all the developer stuff are using FogBugz. So, there is kind of that…the lineation between them and it might be nice at times to be able to kind of tie them together but the thing that I like about using Basecamp is that I can upload files and have them they’re available. I can have discussions. I can put text documents that everybody is going to be able to see and it’s…I’ll say it’s a little bit more visible there than it is on the Wiki and the other thing is that you can put things in there that are highly visible to multiple view. I said, “Look guys, these are our top five priorities for example and these are the things that we’re going to work on and you’re going to work on this, you’re going to wok on that.”
[05:41] And I don’t know, I feel like in certain ways, it’s easier to see the to-do list and you just check them off instead having a process in place where you’ve got, oh, you got to open this up and you’re going to review it. You’re going to mark this result, you’re going to close it and I know that there’s work flows in the background with the FogBugz that you can use to kind of address some of those issues. But it just seems like there are certain cases where just using Basecamp for some things work better because it’s just like a to-do list. “Hey, I need an article for this. I need an article for that.” And you’re just got like ten different articles and it’s like, okay, well how do you track in FogBugz? Typically, you’d have ten different cases for that or you could have one case where they just have to edit it up with time and it’s like, okay, well, is it done? Is it not done? Then you’ll have to drill in and figure it out, oh, he’s got 4 of it, 19 done. You know, it‘s just not as easy to see some of those things.
[06:23] Rob: Right, it sounds like you’re saying Basecamp is less cumbersome for the task you’re doing and it’s less expensive. So, it’s kind of a no-brainer and it’s sounds like if…if you are just a team of three or four developers and you are all coders that you are just bite the bullet potentially and just do all FogBugz because you guys will all get the work flow. But —
[06:43] Mike: Right.
[06:43] Rob: …since you have some non-devs, it kind of makes sense. There is some complexity involved in FogBugz that’s where you’re introducing Basecamp.
[06:49] Mike: Right, right.
[06:50] Rob: Yeah, that makes sense.
[06:51] Mike: So, like I said so far it’s been going reasonably well but, you know, we’ll see how it goes. I mean who knows, maybe I’ll decide to ditch in a month and it just doesn’t work out.
[06:59] Rob: Very good. Any other updates?
[07:01] Mike: The e-mail marketing campaign that I’ve…I’ve mentioned a week or two ago is starting to get interesting. I’ve got the KISSmetrics account set up. I’ve got a MailChimp account set up. I’ve got the template for the e-mail all straightened out and hopefully, e-mails will start flying in the next 48 hours.
[07:16] Rob: Very nice, that’s for a client, right?
[07:18] Mike: Yup.
[07:18] Rob: Okay, cool. So, you’re…you’re kind of rehabbing his old list that that really hasn’t been utilized very well. So, you’ll get to see if anyone has actually have receiving them pretty soon and what their responses and all that.
[07:23] Mike: Yeah, apparently, they have been sending them but they’ve been sending them through their Outlook online account. So —
[07:34] Rob: Yeah.
[07:34] Mike: …it’s not through their local ISP but they’ve been limited to, I think 500 e-mails a day.
[07:39] Rob: Right.
[07:39] Mike: So, they’ll send a few hundred one day and then a few hundred the next day and it’s just they’re not able to get them to the users on a specific time of a day unless they do it themselves and they can’t really schedule that stuff in advance. They have no metrics about who’s opening it and receive rates. You know, they know when it gets bounced and they know when somebody replies and says unsubscribe but beyond that, they really just have no idea what’s going on. So, hopefully, this will turn out well for them but I’m hoping to just having the statistic there and being able to measure that stuff will give them a better idea of what sort of things they should do. And I’m also doing some split testing based on the original e-mail that they gave me versus an e-mail that I’m tweaking to kind of show them and highlight some of the results and some of the differences between us through e-mails.
[08:21] Rob: Nice, well, I look forward to an update from that.
[08:26] Mike: So, today we’re going to talk about our goals and predictions for 2013.
[08:30] Rob: So, let’s dive in. What’s your first one?
[08:32] Mike: So my first goal for next year is to stop writing code.
[08:35] Rob: Gasp. Stop writing code, Mike. [Laughter] So, what’s the impetus behind this one?
[08:41] Mike: Well, I mean the fact is that I’m trying to engineer a business and building a business is not a lot different than building a product. I mean it kind of is but like when you’re building code, you’re building it to provide some sort of functionality and I’m trying to step back from the code because although it is important, as a developer, I realized how important it is to certain things work correctly. As a business owner, I also realized that the business is more important and I can replace myself in writing the code. So, if I can find somebody I trust to handle the code and handle those responsibilities, then I can step back from that. And things are getting to the point where I feel like I’ve got the development team in place that I need who can actually handle it and I trust them to be able to make the right decisions and be able to come back to me with stuff to say, “Hey, this isn’t working. That’s not working. We should do this or that.”
[09:27] And you know, I can just trust their judgment and that they’re going to make those right decisions and come to me with ideas and thoughts about how to do that stuff and I can turn them lose on it and they’ll go implement it in a way that makes sense that it’s going to be good for the business. And at that point, it gives me the opportunity to step back and concentrate on all the other parts of the business that need additional help.
[09:49] Rob: I would like to get to learn Ruby on Rails because that’s what Drip is going to be built in.
[09:54] Mike: Ah.
[09:54] Rob: So, I have a big ramp up [Laughter] period going on there because I just haven’t done much with it. But no, I totally hear what you’re saying and it sounds like you’ve been over the past three to six months, you’ve been hiring and vetting several different developers. So —
[10:08] Mike: Uh huh.
[10:08] Rob: …it feels to me like based on what you said that you’re kind of on way to doing this if you’re able to keep these guys around and that they do in fact perform for you. Do you think your current stock of developers will be the ones that’ll stick around or do you think you might need to change up probably through the year if you achieve success kind of…kind of scale it up and get some…I’ll say some better developers.
[10:29] Mike: I think the guys who are doing work for me right now can definitely handle it. I don’t feel like there’s any weaklings I’ll say, you know, availability and scheduling and things like that are always kind of, you know, an issue that it has to be dealt with but if things start to go well then it’s not like they don’t have the talent. The talent is not my concern. It’s, you know, can I afford to continue to make sure that they’re busy at a rate which they will not have to go look for other work.
[10:55] Rob: So, I have four goals that I have written down for 2013 and my first one is to grow HitTail by 2.5 X. So, 250% and I’m actually basing that on the October revenue. So, it’s about, you know, month and a half ago and that’s just because of that times two and a half makes a nice round number and I figure if I get there around next October potentially at the end of next year that I will be please with it.
[11:19] Mike: Very cool.
[11:19] Rob: Yeah, I’m excited. We have a plan in place and so —
[11:23] Mike: Yeah.
[11:23] Rob: …I’m assuming it’s going to change dramatically as the year goes on but things weren’t executing on right now or have us on pace to do that. So…
[11:29] Mike: I will say you’re cheating though. You’re giving yourself like a 6-week head start.
[11:34] Rob: At least, yeah, about two months it looks like. So hopefully, I mean in the ideal world, I’ll hit before the end of the year in which case it really will be a year over a year thing.
[11:42] Mike: That’s cool. So, my second goal is to launch AuditShark publicly. The January 14th date is really kind of my…my soft launch to get it in people’s hands and work with them a lot more to make sure that they’re using it, gets to incorporate some of that feedback and then I’ll have another launch date in mind where I’m actually going to go public with it and say, “Look, you know, here it is,” kind of open up the floodgates and see what happens.
[12:04] Rob: That’s exciting. The day is finally coming.
[12:06] Mike: [Laughter]
[12:08] Rob: My…my second goal is to launch Drip which I mentioned on our last episode and that’s a new…it’s an e-mail marketing SaaS app that I’ll be launching, hopefully, in the spring, that’s the goal and I also have a 6-month revenue mark that I planned to hit based on the marketing plan and stuff I’ve seen working with…with my other apps. I’m excited about that. If folks are interested to hear about that, it’s at getdrip.com. And it’s one of those things where you just have no idea, right? If…let’s say the launch list is thousands of e-mails, I could hit that revenue mark very quickly or if the launch list is thousand of e-mails that don’t convert very well, [Laughter] then that later it’ll take me, you know, the full six months to get there.
[12:47] So, there are somewhere in between but I just…and like to have…I found it when I have some specific goals to shoot for as long as I don’t let them overwhelm me like I did early on with HitTail where I…where it actually started…it started impacting my performance in a negative way because I was so burden with…with the goal, the revenue goal I had. As long as I don’t do that, I find it that it drives me and you know, it makes me focus on that single metric that I’m…that I’m trying to hit in a certain period of time.
[13:12] Mike: Cool. So, my third goal is to grow to a fulltime team of at least three people. And by a fulltime team, I mean myself and at least two others who are essentially underneath the umbrella of Moon River Software.
[13:24] Rob: Got it and is that working on AuditShark or is that include Altiris Training and others?
[13:28] Mike: It include…it includes the other things as well but I think enough to keep at least three people, if not more busy on AuditShark. As I’ve said before I’m trying to back off from writing the code so I don’t have as much to do there which means I can start pointing at things and say this needs to get that and that needs to get that and I’ve started really doing that over the past month or two. And being able to outsource those tasks so that I don’t have to spend 20 or 30 hours coding three or four different features, I can just say, “Hey, I need you to do this, I need you to do that. And these are the things that need to get done.”
[13:58] And being able to hand those off and have them spend the 20, 30, 40 hours doing those, has really been helpful in terms of overall productivity. And I think that there’s definitely enough work there to keep people busy. I mean I still have 500 open cases in FogBugz right now that need to be fixed in some way, shape of form on various projects. So, it’s not like there’s not work there. It’s a matter of getting the work done in the right order such that it brings in the revenue as quickly as possible in order to be able to scale up the business a little bit.
[14:27] Rob: Where did you come up with the number of three? I guess three includes you.
[14:31] Mike: Uh huh.
[14:32] Rob: Okay, so it’s two other devs. So, why two devs instead of 3, 4 or 5 or just 1?
[14:37] Mike: Part of it is financial reasons because I don’t know and it kind of relates to one of my other goals which is to cut 75% of my travel consulting which essentially means getting rid of all consulting revenue.
[14:48] Rob: Yup.
[14:49] Mike: So, part of that ties in to the fact that I have to essentially replace that revenue with other revenue and in addition to that, I need to be able to fund other people to work on the products. So there’s kind of a huge growth margin there just in terms of shifting from consulting to product revenue but I think that the way things are aligned and the way things are starting to turn out that that’s entirely possible, I just don’t have a good feel for what the timeline of that looks like because there’s a few different things that are in the pipeline that haven’t launch, haven’t gotten out the door yet and until they do, it’s hard to measure what the impact to those are going to be because as you said with the Get Drip, I mean it could be widely successful on day one, it could take a while to get there, really kind of depends on how those things turn out.
[15:34] Rob: Do you also have a revenue goal for AuditShark in mind?
[15:37] Mike: Not specifically, I mean I haven’t sat down to kind of go over all the numbers because the people who are doing work for me right now are doing it more on a part time basis so because of that I just haven’t sat down and do it.
[15:48] Rob: Well my third goal is to have another MicroConf that changes the way that people launch their companies. I felt like the last two years of MicroConf have just been an amazing success and it’s because in the interim year between the conferences, I’m seeing tweets. People hash tagging with MicroConf that say, “Hey, I just launched,” “Hey, I just got this partnership,” “Hey, we started a mastermind group based on MicroConf,” like it impacts people’s business, lives, their professional lives and it’s making a difference in how they do things and it absolutely makes a difference in how I run things based on the people that I meet.
[16:26] There are relationships that…that I’ve been able to build and just the inspiration that I take away from my MicroConf. So, my goal is obviously always to improve the event and to make the, you know, next MicroConf better than the last one but beyond that, I really just want to continue impacting this world of bootstrappers. And I don’t mean this to sound like High and Mighty like oh, we’re changing the world or anything but I really do feel like we’re changing the lives of, you know, the hundred and fifty people that attend. And so that is absolutely a goal high in my list for 2013.
[16:58] Mike: Yeah, I totally agree. I didn’t specifically write that down but that’s definitely entered my mind as well as something, you know, with my MicroConf is just being able to provide an environment for everybody to kind of come together who has similar problems, is in a similar situation and just, you know, providing that environment for them benefits us. I mean it’s…but it’s just really nice to be able to talk to other people who are in the same situation as, you know, myself and yourself and be able to get feedback from people and say, “Hey, I know you had a problem with this. How did you guys deal with it?” Because it seems to me like you can run your business and live just about anywhere you want but when you do so, it tends to be difficult to run in to other people who live in the same area who also have those same types of problems. You just don’t get together with them very often.
[17:41] Rob: Yeah, the…the conversations that I’ve had at the last couple MicroConfs have stuck with me the entire year in terms of both motivation and just changing the way that I…that I operate the new things I try with businesses, new directions that I take and they really are like, you know, I’ve said on air before like that recording this podcast is actually one of the highlights of my week, like it’s one of the best hours of my week to do this. And MicroConf is one of the hardest three days, five days [Laughter] whatever it winds up being but it is definitely one of the highlights of my year and part of that is because of the way it impacts my businesses but the other part is the way that everyone gets together and then I feel there’s like this brief glimpse of time where everyone is on the same page and people go away from it and do awesome things that they wouldn’t have done if they hadn’t shown up.
[18:29] Mike: And one of the next things on my list is to help my wife’s fitness business becomes stable and profitable. I think I’ve mentioned before, she’s a certified Zumba instructor.
[18:38] Rob: Right. Does she work at a gym like she rents a room or she’s an employee of the gym or a contractor?
[18:38] Mike: She’s an independent contractor right now.
[18:46] Rob: Okay.
[18:46] Mike: But she doesn’t have a formal business or anything like and she’s done a lot of certifications around various things so there…she’s done Group Fitness Certification, Zumba Certifications. I think one of them is called like a Gold Certification where it’s designed for people who are older and then she’s also done like high intensity training which is for people who really want to stress themselves and push themselves to the limit. So, she’s kind of all over the map in terms of what she has the capability to do but she’s always going in to these places as an independent contractor. And what she’s trying to do is she’s trying to develop in to more of a business so that she does it fulltime as oppose to somebody who just does it on the side.
[19:25] Rob: And how are you going to be able to help with that?
[19:27] Mike: Right now, I actually…one of the projects that I have that I’m running on the side is to build a website for her and get all that stuff up and running. And then once the first of the year comes around, she’s going to essentially take over that website. She’s going to file for a business. I’m going to be doing some of the e-mail marketing and website marketing for her.
[19:45] Rob: Very nice, well, good luck with that. My fourth and final goal for 2013 is to release three knowledge products also known as information products.
[19:53] Mike: It’s just funny hearing that from somebody who has their background in developer…is a developer and it’s like you look at that and you’re like, “Oh, no. Not another info products.”
[20:02] Rob: Yeah, Well, I mean my goal is for it not to be another info product, you know. The stuff that I’ve done in the past has been different from the standards and that’s certainly the goal. I’m not going to release something that’s not going to help people. I put it that way.
[20:15] Mike: I’ve seen the stuff that you work on. It’s topnotch. It’s…it’s great quality. It’s just that when…when people think info product or when you say info product, the very first thing that you think is like sleazeball marketer who’s selling stuff that’s just…just not work.
[20:27] Rob: Right. So, I’ll call it a knowledge product and is that as…is that clearer or does that just make it…make you not know what heck I’m talking about?
[20:33] Mike: I’m not sure. I think it just needs a different name as —
[20:36] Rob: Yeah.
[20:36] Mike: …oppose like an info products.
[20:38] Rob: So, I want to release three-short training courses.
[20:41] Mike: There you go.
[20:41] Rob: Yeah.
[20:42] Mike: That’s it —
[20:42] Rob: So, that are delivered via…[Laughter] like the first one is going to be a video training course and it’s going to be all the resources and all the info I have on hiring managing virtual assistants. So, it’s going to include sample training screencast, the job posting that I use on oDesk. It’s going to include e-mails and questions and dadadadada so, which is all the info. I actually have a professional videographer showing up here tomorrow and doing a video interview of someone who’s going to interview me about it and I’m excited. For me, it’s a…it is much of a learning process to produce it because it’s such a new thing. I’ve never, you know, done a knowledge part or training course like this in this format. It’s always typically been screencast and or written, an audio.
[21:23] So, I’m excited to tackle this one. The second…third, I don’t…they almost don’t fit this format, the interview format, so I’ll probably do them a little differently but I always like keeping my toe dipped in multiple baskets. The software is fun and that there’s a lot of learning that takes place there but I also really love helping people right in the training is something that I’ve done since, gosh, since I started my blog in 2005. I mean that’s why I started it. It was to pass on knowledge and so…sort of I hope to do with these courses.
[21:50] Mike: Seems like you kind of thrive on publishing or producing different products that are different enough that the marketing challenges are a completely different from one another.
[22:02] Rob: Yes, that’s probably…that’s actually a good summary of it, right, is it that I won’t market this in the same way that I market HitTail or that I market Drip and that’s exciting to me and interesting and it’s interesting for me to enter…I’ll probably sell some of these training courses to different people who wouldn’t buy Drip or by HitTail and that’s interesting to me as well. It’s like helping a new audiences dealing with a new group of people being able to contribute there. But I do like your suggestion. I don’t know if you…I just updated the outline because info products has a certain ramification and training course is…I think I’m going to start calling them that from here on.
[22:37] Mike: Yeah, I think it’s just the connotation associated with the word info product and that’s what…that’s what got me. It was…it was not that, you know, you’re building a training courses that you called it in an info product and it’s like, ugh, I feel like this should be on TV or something, you know.
[22:50] Rob: How about you? Do you have one more goal?
[22:51] Mike: Yeah. So, the last one I have is to write a security book. I talked previously about possibly writing a book and kind of solidify my ideas around it and really think that writing a security book to assist with the marketing behind AuditShark is a good way to go. It’s, again, it’s one of those long term goals. I don’t expect to sit down and just hash it out and bang it out over the course of like a month or six weeks or something like that. I really think that it’s going to take a fairly significant chunk of time to do it but it’s going to be a little bit here, a little bit there. It’s…I view it as more of a long term project. I think it’s going to take a while to get done.
[23:27] Rob: Should be diving to some of our predictions?
[23:29] Mike: Oh, yes. This should be fun.
[23:29] Rob: Okay, I’ll jump in with my first one. Last year around this time, we made a couple of predictions. I think threw out that I thought 2012 would be the year of Pinterest and when I name…when I said that you said, “I’ve never heard of it.” Ain’t that funny? Do you…have you heard of Pinterest now?
[23:45] Mike: I have heard of it. I don’t remember when I last heard it though.
[23:49] Rob: So, it seems to have really resonant popularity with the mass audience and then it seems like with my wife’s circle of friends who kind of first introduced it, all of them have stopped using it a lot. They still use it as kind of as a tool or as a resource but it’s not the social network they were once using it as. They’re…they’re now back to using Facebook for most things and for certain specific niche uses, they use Pinterest. I see there’s a lot of value for designers, for photographers, for things where…where…and travel websites where pictures are really important. I know it drives a ton of traffic for certain large niches, I don’t know.
[24:26] I think 2013, I’m kind of revising my Pinterest or updating the Pinterest prediction. Pinterest just going to continue to grow and I think it’s kind of widely popular and it offers opportunities for tying in to it, you know, with in terms of developers. I think they’re probably going to have an API that comes out that kind of stuff. So, there’s definitely going to be opportunity there but I don’t think Pinterest has the potential to be as big as say…a super large network like Facebook. I do think that it’s going to grow a little slower than that. But as I said I do think there are going to be opportunities in 2013 if…if you’re a developer and you want to start building add ons to something that is growing quickly, Pinterest is going to continue to do that this year. All right. How about…how about another one?
[25:05] Mike: I feel like Google is going to continue to host people for using marketing techniques that they have advocated that people use for years and they’ll do that basically by introducing various Algorithm updates which tweak things that they told people that they should be doing these things and now, they’re going to turn around kind of stab them in the back.
[25:23] Rob: Yeah, probably. I think we’re in general because I have a prediction as well that basically says more Google changes are going to come that are going to hammer SEOs and I don’t just mean Algorithm updates, I actually mean they have tool updates they’re doing to keyword tools. They shut down part of their API that SEOs were using. There’s all manner of things that even with Google, the suggest when you type in it, auto completes your queries, that’s taking stuff away from long tail SEO which scoops it in to, you know, paid acquisition. I mean it really is just an…they have a big anti-SEO stunts these days. So, I would agree with that, nothing shocking there. I imagine they’ll be naming them after some other animals. So, we’re going to have to go for update, the Zebra update.
[26:05] Mike: The Honey Badger update?
[26:06] Rob: Honey Badger update. Okay, so let’s see, another prediction I have is that WordPress is going to continue to become more and more prominent. And this is a no-brainer, right? I think it’s like 17% of all websites were on WordPress right now. It is just 300-pound gorilla and so, there are definitely opportunities there in terms of plug-ins and tie ins, the themes and add ons. I don’t think that market is over. People thought a couple of years ago that starting the podcast was too late. They thought three years ago starting the blog was too late. It’s never too late to get in on these large fast growing markets. And so, I definitely think 2013 will continue to be the year of WordPress.
[26:44] Mike: Well, I have a couple of anti-predictions.
[26:46] Rob: Okay.
[26:46] Mike: So, the first one is I don’t foresee Apple releasing any completely brand new products this coming year. So, what I’m thinking of more along the lines of is this year they released the…the iPad mini…I see them making a lot of tweaks to existing products but I don’t see them coming out with something that is I’ll say revolutionary in the way that they would look at it as revolutionary. I see this incremental updates to existing products but nothing that’s going to make a giant splash the way the original iPhone did or the iPod or the iPad or anything like that. I just don’t see that happening.
[27:20] Rob: Yeah, people are talking that the future is with wearable devices. So, it’s like wristwatches, glasses, other kind of wearable tech that integrates with your mobile devices and such. And I don’t know…I think Google is going to release their Google glasses or Google glass or whatever it is. This year it’s slated. And so, I could see Apple coming out of the woodwork with something like that. Otherwise, they are going to be a little…little behind the curve in that stuff. Now, I don’t know if that’s just going to take off. That all sounds kind of goofy to me. I don’t really want to wear a wristwatch or glasses for that purpose. But you know, I didn’t think I’d want to use a tablet either. I pooh-pooh the iPad before they release it and I didn’t think it was going to fly. So, but I do think there’s possibility that Apple will release an Apple TV this year beyond just a little pock that they’ve released.
[28:07] Mike: I don’t think so. I really don’t and the reason…and here’s the reason I don’t think that they will, I think that…and it’s not to say they won’t take the Apple TV and make it in to more of a media center but when you say an Apple TV or you’re thinking of like an actual television that has like Apple software and hardware built in to it.
[28:24] Rob: Yeah, here’s what I think they’ll do, I think they’ll take like a Mac mini and they’ll use the 35 inch cinema display or 40 inch cinema display or something and that…it’ll be a media center that won’t just be the little pock. It won’t be some TV manufacture by Toshiba either which there are rumors of that and the rumor is actually came up today that Apple is talking with Foxconn in getting quotes on a…an actual television…television like you and I think of, like a 60 inch display, you know, just a TV. All right? If that happens, I don’t think it’s going to happen in 2013 but I do imagine the Apple is going to…going to cut some…some content deals this year and that the…the pocks is going to get revamp. They’re going to have apps to go on that the pock and potentially that software within run on like a Mac mini that drives your large cinema display for…probably for, you know, bedroom use or office use to start with and then they’ll slowly move in to like the living room market where you need the larger displays.
[29:19] Mike: Yeah, I just don’t see them moving in to that living room market because if they can build a device that cause exponentially less that plugs in to the hardware and an infrastructure that you already have as oppose to forcing you to shell out 2 or $3,000 for a TV which unless beyond some I mean Apple that that’s the kind of price range that Apple likes to look at. And I think if the margins that Apple likes to get, I don’t think that they’re going to do anything like that in this coming year. I —
[29:47] Rob: I —
[29:47] Mike: …I can see them doing something with the retina display. I can see them doing something significant there and put it in to like a 27 or 30 inch monitor or something like that and saying, “Okay, well, here’s our giant monitor that has the retina display built in to it.” But beyond that, I just don’t see any new products coming down the line that, you know, because it’s almost like the kind of the end of Steve Jobs’s visions for the company, you know, the pipeline of products that he had in place. I would imagine that it’s probably that that well is almost dry at this point.
[30:17] Rob: Yeah, I agree with you that building large cinema display is kind of a shaky production because the…what is it? The replacement time on there is typically 10…5 or 10 years where we buy a new…whereas Apple likes to have a…something new every couple of years. The replacement cycle is a little shorter. So, anything that has a longer place in cycle, I don’t see Apple getting in to. My next prediction is that this will be the year that some subscription WordPress plug-ins start making the splash. Up until now, it’s been tough for WordPress developers to get recurring revenue and I know a lot of them that are…that are doing well because the market is growing, a lot of people installing new WordPress sites all the time but really getting that…that sustained revenue where you can build a large business is tough. And so I think someone is going to crack that nut in 2013 and hopefully, others will follow because I do think like with my previous prediction that there’s just a lot of potential in this market.
[31:10] Mike: Yeah, I can definitely see that as well. I mean there’s companies out there that are making money hand over fist and at some point, they essentially saturate the market that they’re in and they have two options at that one point either see as growing or move in to other markets and that recurring revenue stream for them just hasn’t really been there and I can definitely see people starting to charge either on a recurring model for updates to the products or maybe taking a step further and start supplying content updates not necessarily just the plug-in itself but content behind the plug-in which I think would be an interesting model because let’s say that you could buy an SEO marketing plug-in for your website where you pay them not just for the plug-in but for a subscription service that will do X on your website.
[31:57] Rob: And some people are doing this now. It’s just no one has achieve massive success that I know about. It’s funny you mentioned SEO services because with HitTail, we have a free HitTail plug-in and if you pay for the HitTail service it, you know, allows you to do some…actually all it does is help with the install right now but we have plans in 2013 to have it provide suggestions right there in your WordPress dashboards so that you can describe blog post base on it. So, that’s the kind of thing that I, you know, I could see…see people doing even potentially without the SaaS web interface at all. Just having it everything be interface through the plug in. Maybe that’s a hope more than a prediction but I certainly hope someone cracks that nut.
[32:36] Mike: My other anti-prediction is I don’t think that Windows 8 is going to completely take the world by storm.
[32:41] Rob: Yeah, this is a tough one because I think it’ll be fine. I mean Windows 8 on a desktop, Windows 8 on the tablet, you know, like on the Surface and others Windows 8 on the phone and it’s Windows Phone 8 but it’s very similar interface. So, which of those are…are you saying it’s not going to take the world by storm, all of them?
[32:58] Mike: I think that they’re all do reasonably well but I don’t think that it’s going to be this giant splash that turns Microsoft around. I mean Microsoft to me feels like it a ship that is kind of drifting. It’s got a good general direction but they’re not making any real head way in the search market or not really making any head way in the mobile market. They’re doing reasonably well. I mean they’re holding their ground but it doesn’t to me like they’re getting the growth, let’s say, they’re looking for. And I don’t think the Windows 8 is really going to change that. Now, that may change down the road but I just don’t think that it’s going to be this year.
[33:34] Rob: So, I think Windows 8 on the desktop is going to do just fine. Windows sells a bazillion copies and then what does it sell…it averages million copies a month right now approximately and I think that’s the pace that…that 8 is on. So, I don’t think it’s going to revolutionize their business but I do think it’s going to keep doing just fine on the desktop although the desktop is becoming a less and less relevant, right? Desktop sale have declined and they’re going to continue to decline because mobile is…mobile and tablets are where people are really spending the money and where the units are being moved. In terms of the tablet, I don’t know, that’s a tough one. I don’t think the Surface is going to take the world by storm because the iPad has such a lock on it but I do think they’ll gain some ground this year on Apple and Android.
[34:14] The Windows phone I think has a chance, a real chance to do some damage this year because the UI is awesome. It works really well on the phone. The Windows phone that I’ve seen and held, they work really well and I’ve had some non-developer just straight up consumer friends who have been…who have love their Windows phone and love the Live Tiles and all that stuff. They…they really have innovated in a unique way, in a way that Microsoft is not known for in that…that phone interface and if they can get enough people liking that, they could feasibly ride the back of that and improve on their…their tablet sales and actually, you know, make a dent as well.
[34:50] So, my fifth and final prediction is that this year in 2013, the startup bubble is going to become more evident and what I mean by that is inflated valuations of startups and I am hearing from angel investors, venture capitalist, this is both people I know as well as just podcast that I listen to that valuations have risen so much that it’s becoming more and more difficult to invest at all that people are holding their money because you’re getting these companies that have just launched and they’re asking for 5, $7 million evaluations when they don’t really have any revenue and you don’t even know if they’ve…if they’ve found a market yet. But they’re so much money that they’re getting funded anyways. And so the…the knowledgeable VCs who’ve been through this a few times, knowledgeable angel investors as well are starting to pull back.
[35:37] And so, I think 2013 is either going to have a burst where, you know, that the non-eligible angel investors and VCs start realizing that their investments aren’t panning out. These companies start crashing and then they have kind of a little panic which is a little bit of a burst. I think that could feasibly happen as soon as 2013. Now, it may think till 2014. The good news is that that doesn’t matter for us. And if you’re building a business where you don’t need a bunch of funding where you don’t need someone to acquire you, then all of this is just a side show. You know, we can…we can listen to podcast and redo the magazines and watch panic ensue. I just don’t think it’s going to have that much of an impact on people like us who are building profitable bootstrap businesses.
[36:18] Mike: Yeah and that’s honestly quite nice. They not have to worry about that thing. I do question though if there is a…if there is a bubble and ends up crashing, what the fallout is going to be for the rest of the market though.
[36:29] Rob: Yeah, well, I mean I think the stock market could take a tumble because it’s so emotional. So, it could feasibly I mean given the tenuous financial situation in around the world right now, you’re right it could impact the markets and people could have a bunch, you know, a whole reaction, a chain reaction of people pulling their money back, stopping their spending so then your and my small bootstrap business can get more contracts. That could feasibly happen. I don’t know that it will. I wouldn’t predict something that dire. I would more predict that it just becomes a heck of a lot harder to get funding over the next 6 to 18 months and that we see a lot of those businesses who’ve been funded during this last 12 months where evaluations have been high that they…they can’t get off the ground, they can’t get the revenue quick enough to meet those evaluations so they wind up having to either do massive pivots, not return the money to the investors or…or just shut down out right. My hope is that it won’t cascade any larger beyond that outside of the tech sector.
[37:27] Mike: So, one other prediction that I want to threw it out there is I think that one of the major PC vendors is either going to go under or have to declare bankruptcy or merge with another vendor.
[37:39] Rob: I could see that. Yeah, because that market is absolutely becoming less relevant and it is in decline. And whether your prediction comes true this year, if it doesn’t, I bet it’ll be in 2014.
[37:50] Mike: The thing is about that prediction. I’m hesitant to actually put a bet on which vendor it would be. I don’t think it would be Apple, I’ll tell you that but —
[37:59] Rob: They’re not a vendor anymore, man. They’re…I mean they’re a consumer electronics company now.
[38:02] Mike: Right —
[38:02] Rob: I would think HP, Dell so…I mean there’s maybe a top five and I…I could easily see one of them merging or shutting down like you’ve said.
[38:11] Mike: Uh huh. So, the one question we have left unanswered though is that will Twinkies make a reappearance?
[38:19] Rob: Very good. So, my prediction is that they will and they’ll obviously be owned by someone else and just be a brand name on a new recipe that’s as close to the old one as they legally can get.
[38:29] Mike: I think that somebody will…as part of liquidation of the company, I think somebody is going to buy that asset. I don’t know who but somebody is going to. I mean and Twinkies are one of those things where it’s kind of an iconic thing more than anything else and I could see a company stepping up to the plate to buy them just to own that icon.
[38:46] Rob: Absolutely. I have no doubts about that. The brand value they say is…is it hundreds of millions? It’s not just Twinkies, it was all the hostess line was in the hundreds of millions and someone compared it. I think it was MPR compared it to the brand value of Circuits City when it went out of business sold for, I think $6 million, somewhere on that realm. So, it’s just that…such a timeless brand that really, you know, has a positive place in people’s mind as oppose to something like Circuit City.
[39:15] Rob: If you have a question or comment, please call it in to our voicemail number at 888-801-9690 or e-mail us at email@example.com. Our theme music is an excerpt from “We’re Outta Control” by MoOt, used under Creative Commons. Subscribe to this podcast in iTunes by searching for startups or via RSS at startupsfortherestofus.com where you’ll also find a full transcript of each episode. Thanks for listening. See you next time.