All these "generic" apps like notes, photo, project management etc will all be bought once they become successful and be consumed by one of the existing giants in the space. On one hand I would love to try out all the latest and greatest apps. On the other hand, I already know that they will either a) shutdown OR b) sell my data OR c) show ads or some such nonsense.
Why can't people just build products and ask for money upfront? Is bootstrapping really so out of fashion? The startup agenda is either make a billion dollar company or go home. Nothing in between. Very sad (I even saw Sam in some video last week asking 'how do you become a monopoly'?) Why this obsession to grow massive?
I guess that one reason bootstrapping is so tough is that it requires a lot of time, usually years, to even start to imagine one day living off of your company.
Imagine you have this nice business idea, which you have been working on for countless hours after work to make it become an awesome product. You sacrife your free time and maybe even health or friendships. You start to feel bad for every day you don't work on your product, as you know it all depends on you, and maybe a couple of co-founders. You know your product is great and it could make many customers happy. Yet what you earn from your it is peanuts and you don't see how this will change any time soon.
In that scenario, venture capital or a buy-out seem like a very appealing idea. After all, if you've come this far, it means that your product means a lot to you and you have more ideas than time. And suddenly knowing that you could get a decent amount of money to quit your "boring" daily job and make all these ideas come true gets even more interesting.
That burning desire to make your "baby" succeed should not be underestimated. That's why so many startups try hard to get a decent funding. I can't blame them, because I've been there. Heck, if a "big player" came to my little startup and offered a good deal, I would probably more than consider taking it. In the end, life is short and you can only build so many valuable things in your life that might have an impact and make a difference.
Still, I'm happy to have a fully bootstrapped startup that is not yet bringing enough money to quit my job. It is tough, it takes a lot of patience, and even more sacrifice every day. But also the prospect of making it profitable enough to have a small team that can work on your idea has a special kind of appeal. Not wanting to be the next Google or Facebook is a good thing in my opinion, but I understand that there is a lot of people who just burn with desire to push their ideas forward faster. Can't blame them for that.
Great comment. My frustration primarily comes from being a consumer of these startups. I understand why co-founders choose this approach. But it's taken me a while to realize that in this "system", I am not a consumer but I am the product. These companies think very differently than what I am used to as they measured by number of "active users" as the big companies of day like Google, Facebook, Dropbox use these metrics for acquisition. Google would rather buy a company with 1m free users than a company with 10k paid users paying 100usd each.
> Google would rather buy a company with 1m free users than a company with 10k paid users paying 100usd each.
Absolutely. This is why you have companies who have not proven to have a profitable business model, yet they are valued far higher than your small, bootstrapped startup. This is one more angle to look at it. I can happily claim that my tiny little bootstrapped startup is actually more profitable than Twitter :)
Can concur- also bootstrapping. It's very hard to get people to pay, and it's frustrating on every level. It's like trying to talk your cousin out of voting for the person who is going to actually work against him. "Don't you get it?" "I don't care." And off they go.
It's mind blowing how a person can blindly spend $500+ on a phone, $100/month on a plan, but scoff at the idea of spending $1.99 on an app. "No, sir!". What? But it would totally help you solve some problem. "I'm not paying for an app". Idiots.
I think you're attacking a straw man - this situation is nothing like the typical pattern of "acquire company, shut down the product". Hackpad has been running for years since it was acquired (everyone in our company uses it regularly). Dropbox Paper is basically a newer, better version of Hackpad. Anyone using Hackpad can "upgrade" by moving all of their pads into Paper. We just moved over - it was easy and cost nothing.
> Anyone using Hackpad can "upgrade" by moving all of their pads into Paper.
I haven't touched Hackpad in a long time and wasn't aware of the acquisition until this HN post. That said, even if I was a regular user I'd pass on the "upgrade" as I stopped using Dropbox for privacy reasons. I'd consider moving (back) to Etherpad more of an upgrade at this point.
> Why can't people just build products and ask for money upfront?
As the owner/founder/author of a bootstrapped SaaS app, I can answer that:
People really, really, REALLY do not want to pay. Really. The dominating perception is that software should be free, or if not free, paid with a one-time purchase in the single-digit dollars. The aversion to paying is huge, you have to provide a "can't live without" feature for people to (grudgingly) pull out their wallets.
Also, if you actually do the numbers as a business owner, it turns out that consumer SaaS apps are difficult to sustain financially. With a small number of customers, there just isn't enough money, and if your customer base grows, complexity and costs step in. My SaaS only has paid business tiers for now, starting at $39/month, because much as I try, I can't see how I can make anything cheaper work. It's easy to underestimate costs if you've never ran a business.
I decided to stick with it, charge subscription fees, grow very slowly and see where it takes me, but that is a hard and slow path. I estimate it will take me another year (for an overall of 3 years) to get to a sustainable income stream.
If you sell your software as SaaS, you need to make sure it is something that your customers use every day. This is a problem when you sell to consumers, because often they will need your software only a few times a year.
I sell a product named MDB Viewer on the Mac App Store, and judging from support emails many of my customers need it just to convert a single database; but they are happy to pay, and they like that they own a license. There's no way I could sell this as a SaaS product.
Honestly, I think a lot of it is just the friction of payment interfaces, endless redirects, anticipation of bugs in those fragile workflows...
There's a lot of things I won't pay $4.99 for because I'm too lazy to tap through five screens and try to remember my CVV. If I could just press one button and the five bucks get charged and that's the end of it, the instant gratification would be hard to resist.
I don't think that Paypal (which can do that) helps that much. It really is a mental hurdle. I understand it. It's: "Maybe I can just google around a bit and solve my problem." It doesn't matter that they can't. It's the fact that they think they might be able to that interrupts the purchase.
As a 2016 MBP owner, I find myself making a lot more impulse purchases on websites that support Apple Pay simply because all I know that all I need to do is put my finger on the Touch ID sensor.
> Why can't people just build products and ask for money upfront?
Because not enough users are willing to pay. The few which would pay won't even cover the increased support effort.
But anyway if you come so far to learn this you already have been kind of successful, because usually it is impossible to get enough attention for your paid app anyway.
They're not willing to pay and further not willing to pay enough. People have a hard time intuiting opportunity cost, so they don't see that a person capable of building a truly useful note-taking application has 10 more lucrative opportunities bidding on their time.
Personally, mobile apps are worth a lot less to me because basically everything on mobile is an "extra" on top of my normal PC. I can't get any meaningful work done on a mobile phone, so why invest money in apps on it? Especially since there are generally free versions available that are good enough.
The only app which I ever paid money for is Locus Map pro, which happens to be an app that only really makes sense to have on mobile.
That's partly because it seems that the odds of ad shenanigans, abandonment and selling user data seems to increase with the price, rather than decrease.
People aren't conditioned to pay single-digit-dollars-if-that because of app-side shennanigans. They've been conditioned to pay that because of the vast array of free stuff out there. The difference between 'free' and 'a few dollars' is only a few dollars. The difference between 'free' and 'fifty dollars' is quite a bit.
Some of the best apps I use are one-off payments. Rainlendar Pro which I've been using for years. FreeFileSync which is donationware.
I totally agree that when there's a free version and a paid/donation version hardly anyone is actually willing to pay though. The pay-once model is really good for the consumer... until the company goes out of business because they're not making any money. Which is why I also buy products that don't require an ongoing service!
I think you're falsely equating "asking for money" with remaining independent in the long-term, I think Hackpad in this case was successful: I know of several companies that used their paid "enterprise" offering for years. At Airbnb we used Hackpad extensively as our wiki in the engineering team.
In many ways Dropbox Paper is like Hackpad 2.0, but it has different branding. Hackpad continued to run long after Dropbox bought them - for 3 years!
This is less of an "our incredible journey" then you think.
Without scale and access to users they are serving as a free user research/prototype for monopoly corporations.
See eg. Sublime text and VS Code. Thank you, Sublime text for validating and educating the market, we'll take it from there with our better and free offering.
>The startup agenda is either make a billion dollar company or go home.
>Why this obsession to grow massive?
It's not just startups. Every publicly traded company is focused on growth. You could have many billions of revenue and billions in profit, but if you aren't growing you're failing. I don't agree with this, but the stock market certainly does.
I'm not sure that's true, there are plenty of "value" firms who invest based on dividends not growth.
Maybe there's a skew but there's an underlying rationality to investors where ultimately you add up the money a company can pay out in dividends etc and work out what they're worth.
I'm far from an expert on this but there's even pressure in the opposite direction - for big companies, investors value a regular, predictable dividend, and can be wary of CEOs or directors with significant holdings who want to take risks and "empire build".
> Why can't people just build products and ask for money upfront?
Asking for money is such an huge entry barrier. Even if it would only cost one cent, it would still stop 99.99% of the users from using it.
I was kinda hoping for Bitcoin to fix this. But now it already cost a lot to make a transaction, and you can't instantly verify the payment. Paper money was a huge step, electronic payment was another huge step, lets take the next step!
Bitcoin doesn't solve the problem, because you then still need to solve the "how do you convince people to buy the Bitcoins when they can just use a credit/debit card" (you can get pre-paid MasterCards in convenience stores across the world) and the "how do you actually get people to buy the Bitcoins" problem - the answer to the latter currently seems to be (a) buying it off some slightly disreputable website that you find by asking on Reddit, or (b) localbitcoins, where you agree to meet some random person in a car park or shopping centre and exchange cash for BTC. Not shady at all.
Bitcoin and cryptocurrency literally solves nothing in the app payment use case.
>All these "generic" apps like notes, photo, project management etc will all be bought once they become successful and be consumed by one of the existing giants in the space.
It's already happening. For example, the Microsoft Office365 cloud suite of apps is looking pretty comprehensive.
>Why can't people just build products and ask for money upfront?
They can. Why can't they?
>The startup agenda is either make a billion dollar company or go home.
A certain kind of start-up with a certain kind of investment model. Lots of startups grow to be medium sized business.
A year or two ago when I was running the SageMath booth at a conference a woman (with a Eastern European accent, I think) walked up to me and said "My son co-founded Hackpad. Their company recently got bought by Dropbox. I was so happy because he said now he can finally eat!!"
Hackpad was cofounded by one the original authors of Tomboy, which was a really excellent desktop note taking app that has withered since. It was based on a fork of Etherpad, which was a startup that made a multiplayer, web based note application- that company was purchased by Google, the code open sourced, and the service wound down. Sort of a long sad trip.
I really liked Tomboy, I enjoyed Hackpad, although I quit using it over time- I collaborate much less now.
I don't take notes anymore, with software or on paper.
I understand where you're coming from, but there is a mindset for some people that note taking isn't all that necessary. It often goes along with the mindset of "enjoy today without worrying about trying to capture it for tomorrow." An example would be those who scoff at trying to capture everything on film and forgetting to enjoy the experience.
The opposing mindset is also valid, of course. Different strokes.
As an aside, there are also so many ways that archiving is automated these days that many things we used to have to manually take note of are automatically and indefinitely searchable.
To be fair - dropbox has shown considerable restraint here. In all that time hackpad was useful and not apparently neglected. And given dropbox gives a small footprint for free, and a bit more of you make virtual instances and email codes to yourself, its not the worst in rent seeking.
I think you're implying that I'm stating the obvious here, but, almost every time one of these sunsetting announcements comes out, it's written as if the company just recently decided this was genuinely the best move for everyone, customers and employees alike. "We've had an incredible journey and it's just time now."
I think the timing of "3 years plus a week" indicates that they either decided this date 3 years ago and were just biding their time, or that someone signed an agreement to keep it going for 3 years and they're no longer being held to that.
There's this open source version of Hackpad, under Dropbox's Github account. Apparently, it's an obsolete version, since the last commit made dates back to two years ago.
Not sure whether they would take down this repo too.
Shameless plug here, but if you were using Hackpad for meeting notes, links, code snippets and other short work notes, you should give https://memo.ai a try!
We're building Memo, a note-taking app for technical teams. We integrate deeply with Slack which makes it super easy to save notes while in Slack, and you can write notes using both Markdown and Slack formatting (including @users, #channels and :emoji:).
Sincere question: why do people use apps like Hackpad and Paper? I mean, obviously "to take notes", or "to collaborate", but in what contexts? In what use case do they add lots of value?
I dig your style. I'm not about solutions looking for a problem. One of my favorite back-and-forth "arguments" with a legit software developer is how much he embraces tech vs. my "luddite" insistence on paper and pen. The use cases end up being very telling.
As I learned from a Jeopardy answer the other day, the most patented design in the United States is for a mousetrap. Everybody tries to build a better mousetrap, apparently that cliche is true! Big picture stuff is kind of wonky like that from my studies, and I love it.
I really love this part:
"Paper takes many of Hackpad’s best features—like instant collaboration, comments, and real-time editing—and adds a lot more, including additional security features, faster search, and more visibility for teams. "
I know it talks about Dropbox Paper, but I just find it funny that this "recommendation" works as well with the real , physical paper.
I wish these companies published their expected longevity at launch. e.g., "We'll be in business from 2015-2017," so you could plan to migrate your data to the next newness ahead of time.
Why can't people just build products and ask for money upfront? Is bootstrapping really so out of fashion? The startup agenda is either make a billion dollar company or go home. Nothing in between. Very sad (I even saw Sam in some video last week asking 'how do you become a monopoly'?) Why this obsession to grow massive?