DISQUS

daveblakeman · 1 month ago

I'm assuming that this post was merely a wind-up, but if you're serious, I thought I'd restate the obvious (you know all this anyway)

As I understand it, you currently have a really neat business model. You supply shrink wrapped/standard software to small/medium sized businesses (a few corporate departments might sneak through, but that's an accident. Shh).

You have a small cohesive development team who (in my opinion) provide good products and excellent service.

And you've wisely moved much of your income stream to monthly rental/pay per use.

The minute you start chasing enterprise customers, a lot of things will change. Firstly, you'll find Enterprise#1 DEMANDS (I've noticed that they don't generally ask nicely) specific feature #1, and without it you can't sell to them. Then Enterprise #2 DEMANDS confusing feature #2 (no feature, no sale). Enterprise#3 DEMANDS feature #3 (an export to their corporate mainframe, using some random data connector you've never seen before). Pretty soon you've got bloatware++ (or a zillion versions of the sources - your choice).

Now, rather than doing the "right" thing, your developers will be beavering away to keep Enterprise#N happy. The really powerful/satisfying stuff gets put back - in a structured way because you're using FogBugz (unless Entreprise#M demands that you use some other version control system before they'll buy anything from you), and your developers start to think maybe this isn't such a fun place to work any more.

Secondly, the enterprise customers will DEMAND that you hand-hold them. You'll need trainers, consultants, installation engineers. And you'll need people to recruit them, manage them, train them, pay them, invoice for their work, chase the debtors (did anyone mention that they don't always pay on the nail?)

And all of a sudden your nice 25 person company becomes a not-quite-so-nice 100 person company. You say bye bye to lunch together. You have to think VERY hard about your great offices (100 people is a lot of office space).

Slowly, slowly, your smaller, loyal customers start to get fed up, because they get less regular updates (after all you're busy servicing your "Premium" customers). And eventually they move their business to another product from a nice small company with smart developers who cares about them.

I know where I'd rather work.

PS.

The Oracle analogy is somewhat misguided. They certainly sell to the enterprise community (and last thing I knew they made more from consultancy than licenses). However, thir presence in the small business market is almost non-existent. So rather than trying to be all things to all men, perhaps you should focus on being THE solution in the small/medium business sector, and leave the joys of servicing enterprise customers to someone else. Or maybe you don't think there's enough business in the long tail...

Matthew Lowe · 1 month ago

We've been in the Inc 500 for the last two years, and this story sounds eerily familiar. (Incidentally, all it takes to make someone an "Enterprise" customer is that they be able to wave enough money at you to get your attention.)

Look, it's clear that the model "kowtow to several huge customers" can bankroll the kind of growth Spolsky is talking about, as can "poop out inferior software and rush to fix it when it breaks". But are there better models that take into account other values?

We're trying to figure that out ourselves. Let us know if you come up with anything clever.

Roger · 1 month ago

This is quite an unusual & illuminating article. It suggests Fog Creek is maybe up the creek?

You think customers buy Jira because of sheer weight of marketing and sales force?

You dont think it has anything at all to do with the fact that you made a poor choice of platform - which essentially limits you to windows servers (and all the attendant problems that brings)?
You dont think it has anything to do with the fact that the UI for FB has (for a long time) been ugly and clunky? Thats not to say that Jira is a beauty queen, but they have put som

The Atlassians have, on the other hand, made some quite astute decisions. Technically and business-wise. They chose a more palatable platform for customers (java) and for themselves and for the developer community they were selling into. They chose good price points to sell their product (free for open source, sub 1k for entry-level) - both of which gave Jira, Confluence, etc good exposure and usage within a community that gave them good feedback.

Atlassian are growing at an impressive rate ... but if you think its a triumph of marketing with no substance in the product, then you clearly dont understand the market you are in.

daveblakeman · 1 month ago

I'm sure you've already written about the distinction between users (i.e. developers) and customers (e.g. the people who actually sign off the purchase).

While you market to your users (e.g. developers), you then (unintentionally) expect these developers to convince their management to spend the money. Your mailing list is your marketing department. You have a force of thousands out there - give them the tools to finish the job.

They need support (testimonials/charts/case studies etc) to go up against all the other calls on a business's resources. A back end tool such as Fogbugz will take a while to return the investment (I know that the payback is huge in reduced cost of support and errors, but where are the figures?) It has to compete with alternative spend on sales and marketing which may get a return in days or weeks (come to think of it, where are their figures?).

Whilst on the subject, how about a short series of emails/posts about marketing for developers, by developers? EVERYONE in the modern economy needs to understand the basics - job search, recruitment, promotion, getting your widget into all the other apps in the organisation etc all require marketing of one sort or another - so why not be prepared to do it properly?).

With a technical background, I spent years under the impression that marketing was all about persuading people to buy stuff they didn't want (and to be fair, some of it still is). However, when I started to teach myself a couple of years ago I found modern "magnetic" marketing totally different - it's about finding the people who NEED your product and then gently persuading them. This is WAY more exciting than I imagined - it's actually a great combination of communication, measurement and technology (three things many developers have already mastered!)

Ahmad Alhashemi · 1 month ago

I think your argument can only be valid if the competitor you speak about stays profitable. Otherwise, they will not last the 8 years required and even if they do, they will not have enough resources to pay 100 more on advertisement.

If you are 100 times more profitable per sale, you can advertise as much as they do.

Wondering Minds · 1 month ago

I hope Joel is not talking about Jira. But then based on his other posting I believe he is.

I have used both (Fogbuzz and Jira) at different jobs and will take Jira over Fogbuzz anytime any day. Fogbuzz at least when I used it last always insisted on doing things it's own way, need of the users be damned. It was like Mother knows best syndrome.

This frankly sound quite arrogant of Joel to dish a competitor's product as junk even though it is not. I had a lot of respect for him, but I am not so sure about it anymore.

Victor M. · 1 month ago

Joel: Now I'm sure your product is much better than your competitors. Months ago, without knowing fogbuz, I chose JIRA. Why? I made a little research, but in the end JIRA is what Adobe uses for their development. And Adobe can't be wrong, right?

In their web, JIRA puts their strong point in big bold letters: 11,500 customers, balblalba. They put the logos of big brands. Everybody feel safe when they see those brands that we all love.

So, put your strong points in your front page. If I understand you correctly, your product is much better. So, denounce that their product is crap, and say why! Put a comparison table! Don't just say "Bring your project into focus". That doesn't mean anything. I can't even read the most important bit, it's so small a font: The 15000+ customers.

In a nutshell: Be more aggresive in your marketing. Tell me in the first 30 seconds why I need to buy your product and not the competitor. Tell me it honestly and clearly.

Hope this helps.

leftend · 1 month ago

I have to agree with Victor here. Just comparing the front pages - I have to admit I like JIRA's better. The FB front page (read: sales page) seems a little more subdued in comparison. I've love to see a refreshed sales page for FB

Kevin · 1 month ago

Joel and others, read please read this --

Sales 101 for Engineering (and Other) Consultants
http://www.edn.com/blog/980000298/post/68004926...

It is a really good short article. It details most of my weaknesses.

"Every consultant needs to know how to sell. As John Huff said, “Everything is selling.” Without sales, nothing happens in your business. Any business. Many engineers are allergic to this philosophy. Some even think that a really good product sells itself. I’m here to tell you, that’s just not true. Everything is selling. I’ve experienced this many times over and am experiencing it now in my own marketing consulting business. Sell or die."

Farhan Zia · 1 month ago

It’s an awesome one; I would definitely like to bookmark it and kept reading it from time to time. I don’t agree with some of the comments to this article – either technology or anything else, business is at the end “a business”. It will behave like any other business. I don’t think the core basic rules of a rice-business are anyhow different than that of a technology-business ;) But just like to all other things in the world, the best approach is the hybrid one. At start (just like in the case of Fog Creek itself), you want to be slow and steady. At that point you would never like to go rush in expanding until you reach to a point when you are confident that you are going well. Your business is growing in a good way (though slow) and you are making profits with a happy customer base. This is the time when you want to change your strategy and think about expanding yourself. Realizing that stage is usually the point where people make mistake and loose the battle either by continuing to be slow and steady or by rushing in taking the decision to expand. Joel, we would love to hear from you regarding when is the right time to take that decision.

David Workman · 1 month ago

After following you for years, participating in all your recent initiatives, and seeing you in action at the recent DC DevDays...I went and checked my calendar to see if it was April 1.

This article is so anti-Joel that I know I can only assume that it was written to provoke thought and response.

Which it did quite effectively in my development crew. Our final assessment after the carnage died down...

...Joel is full of shit and he knew it going in. End of story.

Rob Woodbridge · 1 month ago

A few quick observations: Every small software company struggles with this -- we did at Rove about a year ago and fell into the same trap that Joel is about to do...Sales may be the answer sometimes but it wasn't for us. We went after the enterprise, priced our product a little too high and focused on direct, enterprise sales, boy were we off. SME's, price for value received and GREAT customer service and support is what we opted for after a year of frustration. Lately we've also adjusted our focus from strictly sales to marketing and creating awareness -- we may have 2400 customers worldwide but there are one million companies that have yet to hear about us (we'll take just 2400 more at a time).

One last observation: Competitors are the sign of a vibrant and bustling industry and, IMHO, a healthy dose of respect should be put towards them. Calling their product "junk" is not appropriate or necessary. Beat them on value and customer satisfaction, not on name-calling.

Zach · 1 month ago

Your competitor has a product that runs on either linux or windows (or on their hosted server,) and integrates with a ton of really nice developer tools that they also wrote.

Fogbugz has a really minimal interface and lacks a lot of the really nice workflow tools your competitor also has.

For your sake, I hope you came around to this realization soon enough.

Adam Ierymenko · 1 month ago

Good observation...

I think some of what Joel wrote is true, and I too understand the need for a strong sales team. However, I have used both Jira and FogBugz and would second your observation. FogBugz is also too expensive for most small startups.

There's another one out there called Assembla (www.assembla.com) that we're using now. It's cheaper and has a nice UI but is more minimal than Jira... but it does what we want.

Matt · 1 month ago

I really hope Joel isn't talking about Jira, because it's an excellent piece of software by an excellent team. If he is really arrogant enough to think that Jira is "junk" then he has already lost the war.

Arethuza · 1 month ago

I must admit that I am slightly surprised by Joel's comments. I always thought that a realistic evaluation of your competitors products was a key part of any product based business. Automatically labelling something as junk because it is from a competitor is almost as bad as the anti-MS rants on Slashdot.

Kev · 1 month ago

Who's the major competitor to FogBugz mentioned in the article? Atlassian Jira?

Sudarshan · 1 month ago

http://www.atlassian.com/ Atlassian

Roy Flynn · 1 month ago

As a fogbugz user (for work, not by choice), I'm constantly wondering why things are so... ...difficult. It's like a fixed, monolithic piece of software that hasn't had any UI testing done on it. I assume that that is essentially not the case, but the feel of the application is that it is forcing you to do things its way instead of helping you do things your way. *shrugs*

mmmmm7 · 1 month ago

I'm also curious as to who "the other guy" is here. We use Trac ... Fogbugz would be an instant "yes" if it had flawless Trac import and didn't cost so much (we're a startup -- how can you afford such crazy luxury when you're just trying to scrape by?)

DCL · 1 month ago

>>>
to eliminate any possible reason that customers might buy our competitors' junk, just because there is some dinky little feature that they told themselves they absolutely couldn't live without.
>>>

Oh boy, checklist features! You do know you've just told your competitor exactly what it needs to do to kill you, right? They can keep rolling out more and more little checklist features that you then have to scramble to keep up with. Since they have more resources than you, they can play this game longer than you can.

I suspect that on reflection you'll decide this isn't the direction you want to go.

Victoria Girdziunas · 1 month ago

In my experience, the technical team may love a software product for all the reasons listed - it is a quality and robust product, it's intuitive to use, etc. etc. However, enterprise purchase decisions in Fortune 1000's are made on the golf course or over lunch. The Fortune 1000's are the ones which are tough for small companies to crack and the ones to whom a sale makes a big difference. The purchasing decisions are usually made by someone from a non technical upper management area, that is, removed from technology. And, the deal is sealed with "an old buddy from <<insert name of the 100% annual growth, technically inferior company here>>". I found that you need a "double sell" in this situation - to the technical manager and team by someone who walks that walk and talks that talk; and a whole entire different pitch to the non-technical upper manager holding the purse strings,. Different walk and different talk needed here.

Krishna · 1 month ago

This is very sobering, Joel - especially for businesses that don't want to participate in the "growth is the only way" path to success. A couple of questions though:

1. Ingress and Oracle fought it out in the public markets, right? Where a company is always under risk of hostile takeovers and such. Does this analysis apply to private companies too?
2. What are the advantages of growing by scaling up v/s scaling out to other products/offerings? I think ZOHO and 37 Signals and to some extent Fog Creek too is going for this model :-)?

Your thoughts, please... And all the best with your plans.

Scott Mitting · 1 month ago

Been following you for years, Joel, and I love your attitude, but unfortunately it's been my experience that bullshit works. Really works. Unfortunately, I've always been on the bad end of that, either a client subcontracting work to me achieved through bullshit, or a competitor eating my lunch because they were more willing to bullshit.

I've been struggling to find that balance, where I can be a good guy but still eat my lunch. Sounds like you've been tossing and turning over the same thing.

Thanks as always for your excellent insights!

Thorsten Staerk · 1 month ago

"Joel smells good programmers, but will have no feeling for salespeople" I thought. Wrong! Judge your programmers by their code and your salespeople by their numbers. Know that "greater than" arithmetic comparison sign? Will be your best friend from now on :) Welcome to big business.
Good that you smell good programming skills and neglect sales-skills. Better this than the other way round.

Marcel Popescu · 1 month ago

Hmm... I find it interesting that there are links to two of FogBugz' competitors, but none to FogBugz itself. Someone who didn't know where to find it would have to google it, and he might not make the effort. (He's already opened one of the competitors' sites.)

Joel, I don't think this article was a good idea ;)

omergertel · 1 month ago

The thing to rememeber is that the word processing market has a great networking affect. I can only work with others if our documents are compatible, which wasn't the case. As you wrote once - Microsoft was zealous about compatibility to competitors, and that's what helped them (with a good software) to take over.

Is FogBugz's market the same? If my organization uses it, and another organization uses the competitor, do I get any benefit by porting? No. Interoperability is not a feature for these systems.

Kalpesh Patel · 1 month ago

and you realized this after 10 years?

demondmoy · 1 month ago

I have read many of your columns, but this one is a bit unsettling. While I have not done a great deal of research, I think that the idea of "not growing fast enough" seems to be endemic to the technology industries. You really dont see an addiction to growth in other industries.

Growth is important, but the trends in tech businesses, which I think are very unhealthy and cannibal-esque, should not be adapted by other industries. Seriously, how much waste is created because a consumer "needs" the new whatever? The growth in tech businesses inherently creates an unstable market.

Jess Robinson · 1 month ago

I hope you're joking. Playing catch-up by trying to implement all the various features and small differences that the competitors have sounds like a death march.

Surely one needs to stand out and differentiate ones product from the competition, not chase it??

Peter · 1 month ago

Exactly as Jess said. Why compete on feature basis?

I've always hated those 'where do you see yourself in 5 years' questions, but it might apply here. Do you need to be one of the biggest in this field or maybe you can differentiate yourself a bit, create a great product, maybe to some niche oriented? Something like 37 signals.

One thing to note and this is from my own experience - be careful what this kind of focus shift can do to your company's 'climate'... I've worked for similar companies as a developer and shifting from product (development) to sales oriented usually made me hate my job. It's difficult to have a sales team which is not short term, 'need to make this deal right now and I need these features...' oriented, which brings...

Pavel · 1 month ago

I can only echo the sentiments of other commenters - very atypical Joel train of thought but it does raise an interesting question for debate. However I have an issue with your attitude towards JIRA. I personally evaluated it against FogBugz for my team. Everyone felt that JIRA was a better product overall, even if FogBugz had the odd interesting sounding feature.

At the end of the evaluation period I told your customer rep over email that we chose JIRA instead, and she seemed quite satisfied with a short email explaining why. I think if you want to close the gap you need to really understand those users who deflect and pick the other product instead.

Not to be mean or anything, but for someone who makes constant references to the iPod industrial design making it successful, you really should be evaluating the look and feel of FogBugz with a more critical eye. JIRA feels like a native web app. FogBugz feels like a desktop app trying desperately to get out, rather like something built with one of those early RAD tools for the web. Sorry, but when it comes to "sexy" FogBugz just doesn't cut it.

Rob Uttley · 1 month ago

I really don't know about implementing all the other features from the competition...

I think that FogCreek need to make sure that potential customers see and understand the features FB already has. I've used FB in quite a superficial way for a little while now and I saw the 7.0 demo at the recent London DevDays. What amazed me was just how much there is 'under the hood' that hadn't really jumped out at me before. My response after the demo was, 'wow, I'm using about 5% of what this thing can do.' And, talking to other developers afterwards, I don't think I was alone in this.

To my mind, FB could use some clever, developer-targetted advertising. And the user interface is pretty dry really - I appreciate that in use it's quite a fast workflow once you've got the hang of it, but maybe there could be more of a 'hey, you're new here, let's show you how to do some stuff' kind of mode to the software. Tricky, I know because it's web-based, but I think it would be helpful when people are evaluating the software, if nothing else.

Balban · 1 month ago

For your Step 1:

I think you could change the FogBugz startup scheme to include more people, and perhaps a paid amount that is a fraction of the normal price, instead of free. Also it doesn't seem to be free, its a trial period of 30/60 days. Thats not good enough. I did not choose it because I am not prepared to pay the price just yet. If there was a 12 month period with the scheme I described above, I would choose it.

This mistake is done by virtually all collaboration software. 37Signals charges a lot for a combination of services that only makes sense for an established business. No, not for us right now. Maybe in 1-2 years though.

Secondly, you could include a shared document viewing service. E.g. where people can look at files over a web interface. I need to show TODO files to developers but can't do it. I think Lighthouse has it.

jonvaughan · 1 month ago

This is going to sound stupid, but I think names of products have got a lot to do with this. Word vs Amipro - AmiPro? what the hell does that do? Oracle vs Ingres - one easy to pronounce, one which you might not be sure how to say. And then Jira vs FogBugz - Joel, the Z and the 'Fog Creek' name are high up there on the big issues. It's stupid, but then the people who get to choose are stupid; nobody is going to blink at an invoice with Atlassian Jira on it, but someone would wonder what exactly this Bugz thing was.

Secondly the reason people are going for Jira (which is a decent product) is the triple deal of getting Bamboo, Confluence and Jira; do you have a bundle-able wiki product without a Z in the name? if is is part of fogbugz already then maybe split it out so that it looks like you get more or something.

Anyway, some thoughts. Doubt anyone reads this far down the comments...

GregW · 1 month ago

I agree on the name thing. It's a continual internal sell here to get more people to buy into it just because of the name. Yeah, it sounds trivial, but "Fogbugz" simply does not sound "businesslike" enough. I've even come down to abbreviating to "FB" in conversations and written communication about the product.
Customer service comparison is interesting. We use both FB and products from Atlassian. The latter are very responsive by email (which links into their web front end for issues), and proactive in helping. My FB experience has generally been that you ask things via the FB message board thing.
But it's worth saying I've had to use the other companie's tech support more often because of some frankly silly oversights - the kind of thing that FB does not manifest. The only saving grace is the strong personal tech support and frequent release schedules.

David · 1 month ago

Don't people confuse FB with Facebook?

Sundeep Sidhu · 1 month ago

Hmmm...Joel this article sits rather incongruously with your last one:
'Figuring out what your company is all about'.

If you want to be the biggest, the following tagline is unlikely to drive either sales or growth:
“We help the world’s best developers make better software.”

As a partner in a small software house; I feel your pain. Sales sometimes feels like a dirty word from a dirty business. I am eager to hear about your experiences and tips on how you move this forward in future posts.

Keep it up!

SS.//

Michiel van Vlaardingen · 1 month ago

Very nice read. It makes me think about a problem we are facing with our own company as well: A programmers only company makes products that appeals to programmers. Even consumer stuff we've built, in the end the people who actually like it are programmers or other tech. people.

Now you make think: FogBugz is for programmers, so that can't be the case here... but in the end: Issue tracking isn't for the programmers, it's for everyone else to feel and see that their issues are actually being handled.

In my opinion, if you really believe in your product, you would always be investing almost all your profits into it. I don't believe though that slow growth is slow death, at least not for these kinds of companies. I would say, that if you are able to keep appealing to your existing customer base, there is no reason to die. It does make me wonder: wouldn't it be better for Joel to create a new product, where he can become the real number one? Instead of fighting a battle that is probably lost already.

Jonas Borges · 1 month ago

"My problem is that I've never been able to figure out how to hire good salespeople"

A good programmer such as you knows how to hire a good programmer, so just ask you sales guy to hire some good sales guys.

ramneek · 1 month ago

the link to the 'junk company' has been edited out.....although i know to whom is he referring to.

Simon · 1 month ago

Spolsky's going corporate.

Randall · 1 month ago

This sounds like it was a difficult conclusion to come to. I'll be interested to see how things change over the next year!

JeffreyJDavis · 1 month ago

Great Article.

I think it's all about knowing what race you're in, what race you want to win, how many other guys are running that race, who are they , and how fast are they running? Different industries grow at dramatically different paces, based on their maturity. As long as you are running faster than the next closest guy, you will win the race. This can be 5% CAGR or 53% CAGR, based on your industry.

Regarding Step 1: Don't play defense only. As you survey customers that went to Brand X, don't only ask them why they chose the other guy, ask them what feature they may be missing now that they've committed to the other platform. Use the themes developed to out innovate your rivals.

Regarding Step 2: Even the best of products have to be sold. Investing in a top talent commercial team will usually pay great dividends. Growth cures many ills.

Foobar · 1 month ago

The statement about figuring out what your competition is doing and keeping up, really made me think of the "Fire and Motion" article from a few years back. Except in this case, it's your competitor laying down the suppressing fire.

Jonathan · 1 month ago

To be honest, I only heard of fog creek software from the blog you have.
I haven't really heard anyone refer to fog bugz as an option for project management or bug tracking tool.
I am not really sure as to why that is, but I do wish you luck in turning that around.

DavidRand · 1 month ago

Perhaps a little advertising might help. Google issue tracking or bug tracking software, and you really have to look hard to find FogBugz.

AZDean · 1 month ago

Joel, why do I feel like you just sold your soul to the devil? Are you going to ruin your wonderful environment for your developers in exchange for growth at any cost? Say it ain't so Joel! We're counting on you to prove a great team can create a great product that doesn't get beat by the ugly company who treats their developers poorly (or at least conventionally).

Was Apple beaten by not growing as fast as Microsoft? Or do they chase after Microsoft adding the latest features Microsoft has? No, they are thriving because they consistently make great products that people want.

So the real question is why doesn't everyone see your products as the best thing around? Is it because you haven't marketed them well and people simply don't know? Or is it because some aspects of your products turn them off?

Regardless, please don't just cram in more features as if you've lost your soul. Design your software so that people *love* to use your products. And for heaven's sake, find our why some people don't love your products as they are right now.

Take care.

kalengi · 1 month ago

"Was Apple beaten by not growing as fast as Microsoft? Or do they chase after Microsoft adding the latest features Microsoft has? No, they are thriving because they consistently make great products that people want."

Agreed. Instead of chasing after Microsoft, Apple got into new products and turned the tables.

andrewbroxholme · 1 month ago

Before you decide to hire more sales people or cram in new features you need to know why your customers buy your software and why they don't. Its harder to get the don'ts because you often have no idea they even considered it. You'll have more success following up the people who bought FogBugz 4, 5 & 6 who haven't upgraded. Find out why, what did they need that was missing or what would have made the difference? when they switched to a competitor.

Don't be sucked in by featuritis, my biggest issue with Excel, Word etc is that I pay for a product that I only need a small bit of, I'm slowly moving over to Symphony/ Open Office because they are more like what excel used to be. Instead of making Fogbugz bigger with more features may consider modularizing it so they can buy the project management bit as an option etc.

I worked for a company years ago who were losing 22% of their contracts every year, some down to bad service, mostly though they didn't know why. I wrote them a module for their contract management software that was essentially a survey where you defined by face to face agreement what the customer wanted and the price they were prepared to pay. They reviewed these on a regular basis, a year after the system was in use their attrition rate was only 9% on a turnover in the hundreds of millions of pounds, not all down to my software as they fired a few poor managers but it told them why they were losing customers, who the poor managers were and gave them a heads up to how to prevent losing the customers they didn't want to lose, while parting company with the ones they couldn't service at a profit without any grief.

Cary Millsap · 1 month ago

The kind of change that Joel is describing creates a significant cultural change in a company. It fundamentally changes what a company *is*: how it decides things, whom it works with, how it spends its time each day. This kind of cultural shift can result in a place that's no longer where the good people who've made your business successful will want to work anymore. It's a matter of you, the owner, deciding what you want to be. Reading http://www.smallgiantsbook.com/ can help you decide.

MaR · 1 month ago

Provoked by the article, I too did quick comparison how JIRA and FogBugz poresent themselves on the web. We use different (older) system and I am not biased by actually using/evaluating any of the system.

Web-presentation of JIRA is clear winner for several reasons:
- google lists JIRA first
- JIRA webpage is MUCH more entriprise and big company's decision maker friendly, while FogBugz seem to target developers. A lot of simple explanations, tours, etc.
- JIRA advertises their succesees much more visibly - be it customer base with all those logos (hive mentality!), company culture, etc.
- JIRA offers more friendlier startup packages and is free for noncommercial use
- JIRA offers evaluation of installation on your own server (this is actually what most enterprises like!).
- JIRA also posts their financial numbers, they have offices on different continets -- all this assures potential entrprise decision maker that they are buying from stable company with close support
- FogBugz is not really connected with the "company" website (there's no big logo on the top, just small one at the bottom). For big businesses this is a no go, for them not only product is important but also stable and strong company behind it!.

Generally speaking good product still sells itself, however scale matters and what works for small businesses and individuals doesn't scale well for large companies, where decisions are made by rather non-technical people (and FogBugz with its strong developer focus misses target here). Answer to "Does Slow Growth Equal Slow Death?" is ambiguous: it depends... In this case we can see "collapse of the middle" type of scenario: only big players and niche players (+open source alternatives) are left.

Geoffrey van Wyk · 1 month ago

What was the search term you used in Google? I searched for "bug tracking software" and Fogbugz was ahead of Jira.

phomer · 1 month ago

Software history is littered with superior technology cast aside because its handlers did not or could not understand the realities of the markets. The "if you build it, they will come" philosophy only works if you have no competition or you're just so far ahead of the competition that the products are incomparable. Techies often make that crucial mistake of expecting business to be logical and rational, only to find out that it just isn't that simple. If it were easy, someone would already be exploiting it in a way that causes it to return back to chaos.

paulprogrammer · 1 month ago

Hi Joel,

Interesting to see a shift from "employee focus" to "customer focus" in this message. By allowing the developers to drive the boat, you've created a great product for individual developers. Now, it seems it's time to ask the marketplace what they want, and drive to that.

Marketing pushes are not only pushing a product toward sale, they're also about gathering information to drive & inform product development decisions. The best product managers I ever knew thought of themselves primarily as marketeers.

The change you're describing is not about "making quality vs. speed tradeoffs" so much as "directing development resources toward features that your (new?) clients want". Identify the market you want to dominate, learn everything you can about it, and drive features to meet needs of that market.

In a recent post, you answered “We help $TYPE_OF_PERSON be awesome at $THING” with "helping software developers be awesome at making software". Now, you're wondering how to get corporations (versus individual "software developers") on board -- answer the question by saying "we help software development firms be awesome at {managing their projects|enhancing developer productivity|improving quality deliverables|...?}" and you'll set the foundation for attracting more of those customers.

Joel, best luck my friend. I wait with bated breath to find out how this turns out.

kalengi · 1 month ago

Perhaps Joel is falling prey to what Eric Sink (http://blip.tv/file/1451102/) called beating on a finished product. I think the way to go is to find another product rather than kill a good one.

Roboprog · 1 month ago

Paul,

I can see this either way: either "man up", and jump on the big boy Enterprise train, or, sell out to a VC as somebody above suggested, and start a new product like kalengi suggested. Either way, the times they are a changin'.

Becoming more marketing focused is probably a good change, though not without growing pains. On the other hand, I've worked for a couple of "serial small business starters" before, and they seemed pretty happy with that: Create a working, reasonably polished product, then turn it over to a sales and support organization, freeing yourself up to do another startup, which is what you really wanted to do.

I don't know how much Joel has himself emotionally invested in FogBugz the product vs Fog Creek the development organization. He can't really tip his hand, though. He has to maintain a commitment to the product, especially if he is looking to sell it off.

Henry Tickner · 1 month ago

You DO read Seth Godin, don't you? How to market succesfully and keep your integrity at the same time.

Henry Tickner · 1 month ago

You DO read Seth Godin, don't you? How to market succesfully while keeping your integrity.

Mark · 1 month ago

I remember Ingres. And Informix. And Sybase. And they were all better than Oracle. Especially Informix.

Also, I've just left a company that expanded from 12 to 120 enterprise customers by promising them everything they wanted, without ever hiring more developers. Needless to say, the wheels are coming off that one.

Jim · 1 month ago

A dinky little feature I'd like is that FogBugz for Linux not be six months behind. JIRA comes out simultaneously for all platforms, and although I hate configuring it at least they seem to know that 50% of their users are on Linux. They even have a graph! http://blogs.atlassian.com/developer/2009/03/sy...

Guest · 1 month ago

FogBugz sounds like a bug spray and not an enterprise software name. Or at least some kind of software widget. Only one marketing person? No wonder FogBugz is not widely known.
This product is mainly hyped through Joel's blogs and Stackoverflow podcast. Take these out and your growth might slow down considerably.

I hope you're not talking about Jira as the crap competitor. Those people and the users who use Jira might as well consider FogBugz as the crap competitor and from the numbers, they are winning.

You always mention how great FogBugz is but you never mention why exactly. Because your developers have private offices, Aeron chairs and motorized desks? I don't think so. Every company owner is passionate about their products and think they are the best in the market. However a real user is the one who can attest to this.

Do you really have to be big to be successful for the long term?

Jim · 1 month ago

I wouldn't confuse quality with quantity. There are plenty of small-volume products that are highly regarded; Macs and BMWs come to mind.

whyhaveabusinessatall · 1 month ago

I enjoyed your analysis of software business strategy a lot. The Galileo Company (www.galileoco.com) is a small business (we lend new meaning to the word “small”) selling text analysis and attitude research software to the educational, scientific and market research communities worldwide. We are all scientists, and our company’s commitment is to make available to the educational, scientific and marketing communities the state of the art of text analysis and market research software.
Our scientific and technological advantage is solid and secure; MUCH larger companies have tried to buy (or steal) our algorithms time and time again. And our company. But we’re still on our feet.
We’re trying to make the world a better place to live in, and we’re doing this by trying to move science forward. We know how to make MUCH more money: better graphics, fewer restrictions on measurement precision, dumbing down the software…Hey, it’s easy and obvious how to make more money. But we’ve chosen not to do any of those things.
Although we grow a reasonable amount each year, we could grow much faster, because we lose market share each year to software that makes more “colorful” graphics, where the colors have no meaning, but are very attractive. And to software that tolerates much less precise and accurate measurements, and promises results from clearly inadequate data. We can program more colorfully, and we can promise precise results from junk data, but we won’t, because our commitment to advancing science demands precision and accuracy.
Make no mistake, there are more ignorant people than educated people, and already most companies have directed their advertisements toward the ignorant.
It's time that small businesses come to grips with the question of why they want to be in business in the first place. If you want to make as much money as possible, you’re living in the past. Those days are over, and continuous growth on a finite planet will kill us all.
Let’s think more realistically. Build a successful business. Fill a real need real people have. Build a nice, modest home, in a nice place, and send you kids to college. Pass along whatever lessons you learned in getting along to your children, friends and neighbors. Figure out the problems facing us in our communities and try to help solve them. Find a way not to be a burden on your children as you age. Have a great life!

Adrian · 1 month ago

The only database product I've ever used (as in, written code for) was Ingres.

pbreit · 1 month ago

First of all, no one's ever heard of you already, so don't worry about that. Second, bug tracking is not a winner-take-all category. Third, 50% growth is pretty good but I would suggest shooting for 75% or 100%...that's very doable in software without having to staff up G&A. Finally, you don't have to have a major sales force to have an impact. Get 2 or 3 people with demonstrated success. Start them with low bases and reasonable commissions. Start working inbound calls and leads. Move to outbound. Prove the approach and then step it up.

Geoffrey van Wyk · 1 month ago

I have heard about them.

Zavie · 1 month ago

What about if during the interview the guy applying is able to sell you your very competitor's product?

Geoffrey van Wyk · 1 month ago

No dog? No wonder. :)

Michael Dubakov · 1 month ago

I like 37signals response. Joel, are you going to sell FogBugz to VC?

Wonderer · 1 month ago

How about starting a reseller program and let the others help with the sales? They take a commission and you get a new customer. Would that work?

Joe S · 1 month ago

The hardest lesson I've learned in my 20s as an engineer is that Marketing Matters. Hard to swallow, but very important to remember.

Noah · 1 month ago

I love Fogbugz myself and brought it to 3 different companies. But I am looking at a new tool at my new position, and for 10 user license, Fogbugz is nearly 2K. Jira is 10 bucks. I've used Jira before, and don't like it as much as Fogbugz, but for that price, Fogbugz can't compete.

I also agree with others that perhaps Fogbugz is hitting its stride, and its time to branch out to other, newer products. A bug tracking system only needs to do so much...

That guy · 1 month ago

I do not know anything about Fog Creek Software or its products. I do believe that Joel has an issue with the strategy of his business. Fog Creek is in good standing now, but Joel is concerned about a larger company takeover.

Joel needs to rethink the strategy of the company by:
1. Knowing what the company's competitive advantage is
2. Knowing who the customers are
3. Knowing why the customers buy from him

If he answers these 3 questions first, then he can stir up some options of how to achieve it.

Hongliang · 1 month ago

Glad to see this shift of thinking from Joel. Would hate to see Fog Creek end up becoming the company people never heard of.

"Worse is better".

Rob Holmes · 1 month ago

Great article. It is a tragedy that developing great software, and providing superb customer service isn't enough. But surely you have more than that, you have built a enormous amount of high quality trust between yourself and your customers - which the others (with bacterial style growth) will not be able to maintain. Surely this can be leveraged in the midst of a social media revolution?

KD · 1 month ago

Joel,
not sure you actually read these, but I know that your competitor is Atlassian / Jira. My shop uses FogBugz, but I can tell you that Atlassian is a much more usable product for us and it is also cheaper for my entire organization to use it. I know you're not a big fan of Agile development, but FogBugz comes across as your team not taking feedback from customers on how they actually would like to use an issue/case management system. Jira looks like there was a bit more time spent around listening to user/customer feedback.

KD · 1 month ago

One more thing, I learned the biggest rule in business is that a successful company has to be able to "Survive Success" and you seem to be looking at how to do that.

alexburan · 1 month ago

What can I say to you, Joel? Out of what I read, I can suggest that all you have to do is to more carefully listen to your target customers, record their wants and needs. Then try to work it backward to build a superb product.

Jura · 1 month ago

Hi!

I like your thoughts pretty much.
I want to suggest one idea to think about: I think that Ingres didn't die in one day.
Normally it happens that way:
1. Company, profit and sales are growing;
2. Company, profit and sales are steady (do not grow or even become slightly smaller);
3. Company, profit and sales becomes much smaller.
4. Company dies.

I'm pretty sure that Ingres relaxed at some point, income was growing slower and slower and then become steady. They should be bothered with this but they didn't. And so they died.
Company dies because no one bothers (or not enough people bothers) about it future at the right time.

So I think that way: if right now you have successful company then you are doing the right way.
If you want to hire more people and do more sales - it's ok and it's a good idea.
However I think it may be very bad idea to borrow the money or do something like that.

Just do things which were successfull for you previously! And do it faster! (and I know that you have a big history of successfull actions)

With respect, Yuri.

Wandercoder · 1 month ago

1. Never underestimate your competition.
2. You need a couple of marketing people - one inbound and one outbound for starters.
3. You need a couple of sales people.

After they're done looking over your offering and your competition's offerings, and gotten feedback, then maybe you'll have an idea where you really stand. Building a company that's great to work for is a fine goal. I've been reading your stuff for years and I'd like to work there (if I wanted to live in NYC). However, this is not necessarily in tune with growing and surviving as a business. Take your time and your competition will pass you by. There's a great blog called JoelOnSoftware. He's got some great advice and experience on companies and mistakes they made. Maybe you should take a step back and reread some of what you wrote. Then, get cracking. Good luck.

Jack · 1 month ago

Grow, grow grow...failure to do it is death. I've been part of two software companies that were satisfied with "organic" growth. Both got acquired for pennies on the dollar when their competitors eclipsed them. How did the competition eclipse the company? Management was greedy, and wouldn't take on investors to fund the company. They wanted, and got, control...at the cost of growth and ultimately value. The competitors were willing to trade some level of corporate control for addition funding, which provided them with addition resources to acquire competitors and hire managers that were familiar with growing a company to the 'next level' whereas those original entrepreneurs were woefully out of their depth. The additional resources also allowed the competitors to develop and expand their product lines, and dramatically increase their marketing and marketshare/mindshare in the industry.

Joe Woelfel · 1 month ago

I enjoyed your analysis of software business strategy a lot. The Galileo Company (www.galileoco.com) is a small business (we lend new meaning to the word “small”) selling text analysis and attitude research software to the educational, scientific and market research communities worldwide. We are all scientists, and our company’s commitment is to make available to the educational, scientific and marketing communities the state of the art of text analysis and market research software.
Our scientific and technological advantage is solid and secure; MUCH larger companies have tried to buy (or steal) our algorithms time and time again. And our company. But we’re still on our feet.
We’re trying to make the world a better place to live in, and we’re doing this by trying to move science forward. We know how to make MUCH more money: better graphics, fewer restrictions on measurement precision, dumbing down the software…Hey, it’s easy and obvious how to make more money. But we’ve chosen not to do any of those things.
Although we grow a reasonable amount each year, we could grow much faster, because we lose market share each year to software that makes more “colorful” graphics, where the colors have no meaning, but are very attractive. And to software that tolerates much less precise and accurate measurements, and promises results from clearly inadequate data. We can program more colorfully, and we can promise precise results from junk data, but we won’t, because our commitment to advancing science demands precision and accuracy.
Make no mistake, there are more ignorant people than educated people, and already most companies have directed their advertisements toward the ignorant.
It's time that small businesses come to grips with the question of why they want to be in business in the first place. If you want to make as much money as possible, you’re living in the past. Those days are over, and continuous growth on a finite planet will kill us all.
Let’s think more realistically. Build a successful business. Fill a real need real people have. Build a nice, modest home, in a nice place, and send you kids to college. Pass along whatever lessons you learned in getting along to your children, friends and neighbors. Figure out the problems facing us in our communities and try to help solve them. Find a way not to be a burden on your children as you age. Have a great life!

Michael Sliwinski · 1 month ago

This post made me think about my business which at this point is indeed in a very "comfortable" state with a "comfortable" growth rate and although we're working hard on giving more value to our users every day, we might be not doing enough to ensure a more rapid growth.

Although I also liked and agree to a certain degree with David's of 37signals response, this is something I will be revisiting with my Nozbe team and checking where we can improve and make sure we can "handle success" staying "hungry and foolish" just like Steve Jobs said.

jgodse · 1 month ago

Joel, if you want to keep your company growing, profitable, and fun, you have to respect your brand. In a previous blog posting, your stated brand was to make your company the best place for software developers to work, based on the premise that this brand would cause them to build awesome software. You have apparently succeeded. From what I read, users of Fogzbugz are happy, and willing to pay, but FogzBugz does not have the kind of market share you feel is needed to survive.

It looks like you are now in a place where you are transitioning to a brand that is more customer focused. I believe that you said (in the same posting mentioned above) that you want to build the best software development tools to make users of those tools happy & productive. I think that this is not an unreasonable transition to make as I believe that you have hit the limits of the previous brand. However, as most companies find with 20/20 hindsight, brand transitions are very risky. I think that you perceive that risk, and are trying to mitigate it by driving to grow yourself around it.

A number of comments have stated that the surest way to grow is to get enterprise accounts and respond to their demands. However, most software vendors that do that end up with a marginally profitable company that spends its time integrating and fixing their bloatware to ensure that the next account does not disappear. They also have to take on business costs (support, integration consulting, sales, strippers & steaks) that are not needed for a company like yours. You could go that route, but I think that it would dilute your previous brand (a great place for developers to work), and you proposed new brand (products to make developers happy). The main reason for this is because your company would be dominated by people looking to make their next commission or bonus, and not on making great products. Also the people making the purchasing decisions would not be the people writing the code and benefiting from using your product suite. So you will be more likely to build features to keep procurement people happy.

My suggestions is to go and figure out what makes programmers happy in terms of using your product. I think that enterprise-ish pricing points will assure that you get locked out of the market of small software development shops. Let's face it. These days, you can get hosted Trac wikis that are integrated with Subversion, Git or whatever for $20/month for a small team. Nobody's going to pick your product on price as it currently stands.

However, you seem to have a few features to evidence-based scheduling that could help a lot of small development teams accelerate their pace and predictability. This should justify your price points, but you need a way to make it sell. Developers will appreciate it because it makes overtime and death-marches less likely.

Also, many now recognize that Agile development processes are more likely to make developers happy, but some comments say that your software is not Agile-friendly. There's another opportunity to ingratiate yourself with developers.

You pulled off your unusual brand strategy from 10 years ago and built a successful business around it. I think your next brand is good too, and I think you can build a good business around it.

David R. Albrecht · 1 month ago

Interesting change of direction for Joel. I'm all about building the "Ben and Jerry" business, as opposed to the "Amazon.com land grab". Fast growth is risky, but if you're in a market where there are huge network effects (as there are in database software), you have to grow quickly or die. On the other hand, there are plenty of markets where competitors can peacefully coexist for years; it all depends on what you're selling.

Al Breveleri · 1 month ago

You need to create a new company with a new brand, and that brand must be to make that company the best place in the world for a salesman to work. A place where a salesman or sales department manager will want to come in to work early, and will find it difficult to leave at the end of the day. Ask yourself, what would a salesman consider the ideal job -- then create that job.

Of course, you don't want to create a separate corporation, but rather an in-house sales department. Otherwise they may sell cars and furniture instead of software, which won't help you. But salesmen are unlikely to care about the best place for software developers to work, so they are going to have to have their own brand.

-Al.

davidcalabrese · 1 month ago

Do you want to be Zappos or Microsoft?
Zappos built a brand around their quality customer service and people came to love them for it.
Microsoft outspent the world and people trusted them as the brand to use for it.

There are different strategies for different markets. Not being the first mover means it will cost you more to compete on a brand level.
So, can you focus on one specific service arena, market segment or vertical within that market segment and be the dominant brand?
If you can become the dominant brand in several smaller segments you will have the money and groundswell of reputation to climb the ladder.

Second comment... is there a way that you can be seen as the dominant brand in a specific geography or market segment without spending too much money on marketing and advertising?

When a company spends a lot of money consumers have a sense of trust because "if they spent that much money to advertise to me they must be legit" Not that people actually say that, but we think that way. We trust "name" brands because that name was built through marketing and advertising, not because it is necessarily any better.

Look for some low cost, high profile/traffic ways to become known as the dominant brand in your space.

You are in the software business, which in my opinion means you sell a service... a service that someone can and will replace the moment they have a chance. People throw around terms like loyalty, switching costs... honestly, why would someone use you and then never use anyone else again? Put yourself in the position of your customer, sell yourself... what would you need to hear to make a decision, to stay with the company and to spread the word...

Andrew Ogilvie · 1 month ago

Atlassian don't have a sales force that will come and pitch to you, their product mainly sells itself online. Their strategy has been to sell a strong product at a reasonably low price (by enterprise standards) which has grown on the back of referrals, reputation and viral exposure to it.

They now seem intent on pushing into the SME sector by seeding it into micro-businesses with a $10 license for up to 10 users.

Perhaps try and focus Fogbugz on the needs of Microsoft orientated developers who will shy away from Atlassian's java based solution.

José · 1 month ago

Joel,
Just be careful about "featuritis" at Step One (I'm pretty sure your team can't fail at this.)
While reading step two... I was waiting for an "I'm just kidding. There's no executive."
Good luck with your new goal!
José (a customer from México)

daverothschild · 1 month ago

Joel,
You have already hired your best sales people: your existing customers! Building a company like you have, you presumably have a much higher base of loyal customers than a typical company, even of your larger competitor. Profitable growth from loyal customers is a much higher barrier to entry than many other things. And, emotionally loyal customers (not just behaviorally loyal) are up to 120% more profitable. They actively recommend you to others. So be careful about hiring sales people that don't understand the value of loyal customers. You are hinting at needing to shift to a market share strategy when you appear to be following a great profitable growth strategy through unique, relevant products that drive customer loyalty. Don't mess this up with market share driven sales people. You need a marketing person that understand loyalty and can then shape how to leverage that into sales. I can tell you much more about this if you want or look up emotional loyalty as a start.

Look at Apple's market cap vs. any other computer vendor? Apple is smaller than all of them but a higher market cap. Apple is more profitable and has a higher percentage of emotionally loyal customers....that drives higher profitable growth and a larger market cap. Revenue allow is not the metric of a successful business.

girlwithnoearring · 1 month ago

JIRA is a great product. I last used Fogbugz in June 2008, and then moved to a company using JIRA. It's a real pleasure to use, which is good, because I use it for hours every day. Fogbugz was not a pleasure to use. Maybe Fogbugz is way better now, but if I were in a position to choose for another company, I'm pretty sure it would be JIRA all the way.

Vilx- · 1 month ago

One more thing to think about - as you said, when you created Fog Creek you set out with a goal to make a place you like to work at. It seems to me that at this you succeeded. But you did not make your goal to "make the most money" or "be the most famous player in the market". That would have required a completely different strategy, most likely even in direct conflict with your first goal of a comfortable working place. So I say - ask to yourself - is it worth it to change your goals now? Maybe its indeed better to stay where you are - be small and comfortable. Sure, you won't overtake such industry giants as Microsoft, but if you haven't gone bankrupt until now, I see no reason for it to happen in the future.

Simon · 1 month ago

"Changing the prices for new customers is easy, he explained. The hard part is building a slick new area on our website where existing customers can go to convert to the new pricing."

If my top programmer couldn't do that in 3 weeks I'd fire him. This guy must have been running idle for too long!

mrtortoise · 1 month ago

how can you make a comment like that about a system you know nothing about?
I'd fire you for that tbh.

ovalsquare · 1 month ago

I echo mrtortoise: three weeks to release date you're not going to be finding any significant time to do a broadened scope on any feature/project.

russallred · 1 month ago

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eyejean · 1 month ago

In my opinion you and your customers are your best sales people. I heard about Fogbugz and Joel on Software from your customers. I tell people I meet needing great tools and advice to look at what Fog Creek is doing. Carry on being a Small Giant and stick with what you set out to create. It seems to be working really well!

Also don't try to be all things to all people, listen to the community and let them influence the direction of your tools. Don't make it your mission to plug every reason for customers to buy competitor software. You may just find you loose your real focus trying to eliminate the competition.

J

Nagu · 1 month ago

This might sound dumb - but you need a different name for your product. Developers and others always say things like - look at this JIRA, write a JIRA, open a JIRA, etc., Now put fogsbuz in there and see how it sounds...

Greg Magarshak · 1 month ago

This is awesome.

I want to point out two things you said here that I feel, as an entrepreneur, are the most crucial. One is to get into your customer's head and take away reasons to leave your product, while motivating them to use it. I for one came to FogBugz recently after researching project management software, and decided to try it out because it made things like estimating time easier. I can't remember why exactly, but I abandoned the free trial on the first day and never went back. I think it was the interface. It has to be dead simple, like BaseCamp. The simplicity is a byproduct of getting into the customer's head. You need a friendly, beautiful looking interface / default skin. And like the first commenter said -- name your product something positive and catchy. What's with the Fog?

The other thing I want to mention is that you guys can consider taking out a loan and paying it back when you get more sales. This works better when you have a predictable machine going, i.e. if you can measure the effectiveness of your customer acquisition, how much money each new customer brings in on average, and find something that can scale up. Maybe an affiliate program might do the trick. Anyway, some ideas.

I for one have long enjoyed reading about your exploits, Joel.

Don Phin · 1 month ago

Joel- Seems like you and I have both built our businesses around a "lifestyle" ideal. While "slow and steady wins the race" may work with Aesop it may not in our line of work. I for one don't want to borrow or bring on other partners. (Read Dennis Felix's book on being rich and you'll see why he agrees). I don't want to hire so fast it screws up my cashflow and I end up borrowing from myself or even worse, does in fact put the biz at risk (enough of that already). So for me the answer is two fold- do a better job of Info-Marketing (ala Dan Kennedy and Jay Abraham) using great CRM technology, Google analytics, follow up systems, etc and find a big bad ass partner who needs somebody like me because their competitior works with somebody like me and I can help their clients. Dennis called it Elephant Hunting. What I won't do is burn my ass out, stress my family and employees all in an effort to get big (and not necessarily rich) or die. That's a bunch of noise nobody has to listen to. It's a choice. Good luck, Don

random guy · 1 month ago

Joel
you are allocating just 2.5% of your workforce for marketing (and 0%(?) for sales). your resource allocation scheme seems terribly skewed towards development and service. you know your software and services are great. others dont know that. you need marketing people to let the world know about you. you needs sales people to convince people to hand over some change in return for a much larger gain in productivity, business insight etc.

satisfied customers are your best salespeople...well not exactly: they are trustworthy and cheap (they pay you money!), but they are not working around the clock for you. they may drop your name, and get you some referrals but not as many as your great account executive.

even if there was a law barring you from expanding your business beyond 25 employees, you should divert some of your horsepower to s'n'm (sales and marketing, you pervert:).

here are some ideas:
brainstorming: since your company seems like a tight knit group of people i suggest you all do some heavy brainstorming to come up with marketing ideas, approaches, goals etc.
an hour a day keeps bankruptcy away: conduct the following experiment: for 4 weeks, let each of your employees spend an hour a day on marketing. at first the time will not be task oriented, but as focus is gained the marketing hours can become more structured.
divide and conquer: divide your employees into marketing groups (support vs. development vs. qa or, men vs. women vs trans) let each group develop and execute their marketing plan (needs some budget). conduct a competition between them over the 4 week period. when the smoke clears and the battle is over give every team great prizes and conduct post mortems.

you seem to have a mental/psychological disposition away from sales/marketing. you must admit this to yourself and resolve to change your ways (this is my supposition, you know if its true or not)

1 year foreign study total immersion program: you xor your partner should take the next 12 months off from whatever you were doing before and completely immerse yourselves in the sales and marketing of your business. you must drop all your current duties and focus solely on sales and marketing. you must recognize that these areas of your business have not gotten the attention they need. the person who doesn't get to go abroad should act as the tough boss/comptroller of the other, demanding reports, strategies, knowledge buildup and transfer and business accountability.

if you had to pick one advice pick this one:
hire hungry young-at-heart hard working honest people to do your sales and marketing. pay them minimum wage+bonuses. make it worth their while. it will be worth yours. (of course pay their expenses and goodies (you may have to pitch in paying their rent)) if their compensation is based solely on their performance, they will be working extra hard for themselves and for you. i hope you end up paying them insane amounts of money. but they have to be honest, so that your brand does not get hurt.

good luck

an hour a day

Salman Suhail · 1 month ago

Dear Joel,

As a happy customer of your product - i can definately say that you guys have the engineering angle down without a problem - in fact you seem to be quite confident of that as well.

But its not only sales people that your lacking - your website design is woefully out of style, and in the business that you are in - it should be your primary sales tool. After all there is only so much you can get the word out by going from demonstration to demonstration. An engaging website is a marketing AND sales tool - and if you drive traffic to your site through the correct implementation of online marketing activities and engaging social media - you should be able to increase the number of sales while not creating too much of an impact on costs.

Im guessing this "competitor" that you mention in the article (but fail to identify) is 37signals - with basecamp as their main product. Without a DOUBT or a question fogbugz kicks their product's ass out of the ballpark - but you have to admit they have one of the most engaging websites and marketing strategies in place - which means they get more visibility, more people talk about them, and that converts into more sales.

Take the lead, get people to start talking about you and your product, start engaging your existing customer base through social media, make them your ambassadors so there more likely to suggest you, and most importantly - revamp your website with some serious A/B Testing and study your sales process and its conversion rates.

Heres to hoping that you guys never disappear...

cheers!

Salman Suhail · 1 month ago

Oh and btw - EVERYONE thinks that FogBugz is a BUG TRACKING SOFTWARE as opposed to a complete PROJECT MANAGEMENT solution - iv had the most difficult time convincing people in my own company (and to a large extent - still havent) that you can use FogBugz for Project Management...

Its a shame really - but thats what the name implies and unless you know the software - thats what people are gonna think of it...

antonyawaida · 1 month ago

Hi Joel:

Glad you shared your article above, you seem to have gotten good feedback from a number of well wishers.

Here is some more feedback - just in case you are reading the comments:

1) Adding every feature that made customers buy from your competitors is IMHO the wrong approach. There will ALWAYS be new features that customers consider (or are told by their salereps) "must haves". The right approach is to focus on the needs of a segment of your market and offer the best feature set for that segment. This would enable you to create a defensible position in the market from which you can - overtime - branch out into other segments.

2) Hiring a good sales team is always very hard - even for experienced sales managers. AND creating an environment where "the best salespeople want to work" is another oxymoron. The best salespeople want to work at a place where the can make the most money! They dont care about office space, ergonomic chairs and the like.

In fact there was not another company, during the Oracle/Ingres era that dabbled in the database market - DEC. DEC was also focused onthe well being of its employees and the word on the street was:" if you are a good salesperson, you get a job at Oracle, if not, you get a job at DEC".

I bet you have never of DEC!

john boudreau · 4 weeks ago

Great article, especially your point about sales. Sales is what drives any organization. It doesn't matter how good your product is if no one buys it. You need someone focused like a laser beam on driving sales.

benin · 3 weeks ago

I think that this is a very compelling article. You do make some powerful points in the article. However, do you think that growth rate alone is the determining factor in the rise & fall or the success or failure of brands? Or could it be that growth rate is merely an indicator of whether other more underlying elements are performing or under performing for the brand?

oweng · 3 weeks ago

great thoughts. I don't see any reason to think it's either "market dominance and 100% growth or death" that just seems ridiculous to me. There are and will always be softare companies of various sizes doing all kinds of products. I can see Joel's pride in his product and how his employees are treated. Oracle is a fascist greedy company; so was Siebel. Being hard driving and fascist is no guarantee of survival either.

Mihai · 2 weeks ago

Joel,

'botnet' of sales people in all cities paid only by commission (students ?)
no cold calls
they get the leads from you: companies that just want a demo (management does not have time/patience for trials)
you entice the only on commission people by giving them an initial gift:
- mug with your photo
- your medium-sized photo in a nice frame autographed
- your photo wallet-size

mohsin · 2 weeks ago

Very great article, and I 100% agree with this " if you're not taking any risks, you're pretty much guaranteed to fail." and the fact that "I've never been able to figure out how to hire good salespeople. " is a very big reality and challenging thing and a very good advice for start ups like me.

Sharika · 1 week ago

Okay i needs to know hw to mak an business plan for a night club can u explain to me hw to mak one or help me to understand it