Dave Jafari

I had some time to relax after the post-election havoc and South Park was running their annual election mockery episode (I’m always shocked when there’s something I’d actually want to watch on TV). Being a big fan of Morgan Freeman, aka The Voice, I had the itch to play around with one of the episode’s subplots.

Morgan Freeman is always the answer.

I was curious what a Pinterest-style layout would look with videos. That’s a service I’d probably use myself, but I’m not sure that feature alone would be worth building when you can just create a YouTube playlist. Speaking of Youtube, I needed to use their API for one of our consulting projects, so it was a natural fit.

See Ask Morgan Freeman for yourself and, if you find any other mischevious sound bytes from him on YouTube, let me know in the comments~

I’ve been to San Francisco several times but never had the pleasure of seeing the famed Silicon Valley for myself. One thing that sticks out is how wholly unremarkable this place is. Don’t get me wrong, the geography is stunning and the weather is simply beautiful. But somehow I expected to see Ivory Towers and maybe a few marble statues of Steve, Larry, and Sergey. Nope, it’s just as unassuming as most American suburbs. 

Stanford’s architecture is great for long, relaxing walks.

I suppose that’s why the atmosphere is so casual here. Just about everyone I met at Startup School this weekend was incredibly laid back and, most importantly, completely open about their dreams. It’s refreshing to have open conversations with people here and it really gets your entrepreneurial juices going. 

Startup School itself had some great talks which meant different things to different people. I won’t rehash what’s been said already. You can watch them for yourself and form your own opinion. I do know one thing though: when Ron Conway said he could size up a person in 10 minutes to tell if he wanted to invest in them for life, you could see a sparkle in every eye. The imaginations of a thousand future founders was ablaze with the thought of getting those magical 10 minutes and finding out you were the one. 

I came for the people and the personalities and it didn’t disappoint. Even if you have no long-term plans in the Valley, I highly recommend getting down here for some meetups. The way it energizes you is difficult to put into words. It felt completely uncool to be the guy “just doing some consulting right now” instead of going to the felt on an opportunity. Feeling normal for a change was awesome~

We put so much time into figuring out how to convert a user into a subscription that we can easily overlook when they leave. Someone leaving is the defining point in your customer lifetime value equation, so it’s just as much an opportunity as signing them up in the first place.

I signed up for President Obama’s mailing list for the chance to win one of those dinners you’ve probably heard about. It was an interesting opportunity to ask the President one question, and one that I intended to use to bring attention to my startup. But they abused me by sending endless emails which asked for money in an increasingly desperate fashion. 

I said enough and hit unsubscribe. 

Perhaps I should be upset that they knew they were spamming me too much, but I was instead pleasantly surprised that they offered me a mutually beneficial solution to my plight. So I took them up on the offer; unsubscribe averted. 

When your customer decides it’s time to go, will you be ready to take advantage of the opportunity? Converting a current customer is much more cost-effective than an unknown visitor. They’ve already signaled their interest, all you have to do is to deliver on your promises.

Month in Review

Pre-traction startups are fertile grounds for the attention deficit. When you don’t have investors or customers, you lack the external pressure to keep focused. It’s easy to veer off into a different idea or be indecisive about any one of the many routes you could take. I think the modern internet has the power to make anyone a little ADHD, so this problem applies to everyone. 

We have a consulting business and it’s going well. Our development schedule is organized into short sprints ending with an in-person meeting. Facetime with a paying customer and tight deadlines are great motivators. The challenge is that our product efforts have no such constraints. It’s been too easy to be casual, indecisive, and vague. 

When I look around at my peers like Nathan and Tony who are growing awesome businesses and working with a singular purpose, I envy their level of focus. Having customers is like cheating when it comes to nixing distractions. So this pre-traction period is where you have to create your own external pressures.

Our First App

This month we officially started building Medium, an iPhone app for email and part of the greater Zenbox vision. I discussed our product vision with a friend last week and uncovered a nasty little secret. When he didn’t seem to “get it,” I delved deeper into the thought-process and minute details of each feature. You know how things make perfect sense in your head? Try actually communicating those thoughts and you’d be surprised how often it comes out like idea vomit.

I realized that my friend wasn’t the problem. What I was telling him was a disorganized collection of random ideas without a clear meaning. Sure, it made sense to me, but it meant nothing to him. So we had the moment of truth where I admitted that I was pitching the concept in an entirely terrible way. Even when speaking to another developer, I needed to structure my message as if he were a potential customer. The lack of focus was telling, so when I got home, I pulled out the notepad and immediately started trying to find it: 

After reading hundreds of papers on email communications and productivity, several common themes emerged: 

• features such as tagging and folders actively reduce productivity no matter how they are employed
• search and scrolling are by far the most efficient means of information retrieval
• email productivity is highly correlated to actionability
• users are willing to try new systems: there is little vendor lock-in and email is a major timesink

Medium seeks to simplify the email experience by removing unnecessary features which actively reduce productivity. There are no folders or tags. You don’t have to spend time organizing, drilling into folders, or maintaining the mental overhead of an ad-hoc system. We focus exclusively on the communication and information retrieval aspects, and dump popular but unwarranted features.

We treat email as a transient conversation. Traditional systems employ a segmented-list pattern in which email can be organized into separate buckets and traversed in a random access manner. Medium follows a stack pattern in which unread messages may be traversed in sequence and are only accessible once. After the message is read, the client will no longer show it, and there is no list in which it can reside. This forces the user to stop treating the email client as a repository of notes, todos, and documents, and transforms messages into inherently actionable items.

Inspired by the Get-Things-Done methodology, we provide the tools that are required to create an actionable experience. Each message has an action bar that will allow you to defer a task by creating a todo or scheduling it on your calendar, to delegate it to someone else, or to reply immediately. When you’re ready to move to the next message, you have the option of archiving the message for later search or outright deletion.

This basically expresses our message, but reading off four paragraphs to someone isn’t going to work. The short version: “we are making email more productive and actionable.”

This message is the start of making Medium a reality, not just a fuzzy idea. Being open about our progress on this blog helps make me feel accountable. Any one of you might be a potential customer. Add in some material goals with real time-tables and we will achieve the same productivity and focus as our consulting work. Deadlines and accountability are our weapons against distraction. 

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We’re still here and public with the numbers. Besides helping me with accounting, I’ve found it to be a source of interesting conversations and haven’t seen any drawbacks. I’m not interested in selling a made up story to investors anyway.

In fact, I’ve started looking for new ways to be open and transparent. Looking for contractors is an area I think could benefit from more openness. Some of the filters for determining whether a consultant would be a good fit for you are prices and areas of expertise. I’ve always found it frustrating when shopping around that you had to open communications with companies and often go through a lengthy conversation just to get these tidbits.

It’s great for the contractor: a sales lead is a win. But for the potential customer, imagine doing this 10 times, especially when you’re not in the business of provisioning vendors. So we decided to just make it public and accessible to anyone: our Project and Pricing Guide.

Revenue
$9,600.00 ($600.00) Services
$0 (-$64.76) Merchandise
$9,600.00 ($535.24) Total

We added two new clients with small projects this month. I also turned away a potential job where we could have easily charged thousands for something that could have just as easily been done using an existing, cheap web app. Instead, we gave them some links and advice. Trust is valuable and I believe they’ll come back with a more exciting opportunity next time.

If any of you are looking to build a new web application or iPhone app, we’re looking to fill one more project this year. The spot opens in October and will be the last client we take on until next February.

Apple’s OSX Business Model

I love the Civilization series so much that I was willing to spend $250 when the latest incarnation, Civ5, was released. Best Buy unlocked a thick plastic case to retrieve a $150 copy of Windows 7 and VMWare sold me a $50 pass to install it on my Mac without having to use Bootcamp. I would have happily given all of this money to Sid Meier if they released on OSX to begin with.

My only poster; a show that took me 8 years to get to and was worth the wait.

The Mac was king in a distant memory and long has been his seat on the sidelines. But Apple has managed to change the rules of the game in a way that Microsoft has been unwilling or unable to compete with. This is disruptive innovation. In the past, Microsoft treated Windows as the key to the kingdom. They charge a hefty tax to enter, but once inside, you’re pretty free to explore and enjoy what you please. In a world of OEM distribution and single-purchase economics, this approach was ideal.

On the other hand, Apple has taken advantage of their closed ecosystem. I can get new OS upgrades at half the price of an XBox title delivered straight over the web without a visit to the glass case at the store. It’s cheaper, it’s easier, and I think it’s proving more profitable. Whereas Microsoft hits you hard with costly OS upgrades, Apple is treating their’s as a platform. To gain access to it, you buy Apple’s hardware and purchase software through Apple’s storefronts. They charge a premium when you purchase their devices and continually generate revenue by taxing your iTunes purchases. 

To decide which business model is optimal, I think it’s important to establish if what you’re building is a platform. We’ve started coding an iOS email app that is part of our larger Zenbox vision. By all rights, we could probably give it away for free. Selling the platform isn’t our business, but selling a service on top of it will be. We simply could not build a profitable business unless we took the Microsoft approach and charged a premium for the app and its upgrades. The benefit of Apple’s platform approach is that we can give a much more competitive entry point for our software and begin building an expansive marketplace for selling future services.

Apple’s platform approach provides a more consistent user experience, less fragmentation for implementors, and less consumer resistance to a recurring development model. More importantly, Apple has made the thought of paying $150+ for a new OS disgusting. The game has changed and Windows features will be largely irrelevant until they modernize their pricing and distribution models.

When you’re deep in the thralls of a startup, learning to market yourself becomes paramount. What may seem simple on the surface reveals a deeply sophisticated topic. As I’ve been learning more about marketing, I’ve gained a greater appreciate for it’s techniques, regardless of their manifestation. That’s why I couldn’t resist opening this suspicious package even though I routinely send junk mail straight to the can.

Dear FedEx: Please sue us.

I had to find out what was worth committing this particularly egrigious trademark infringment. Obviously, there was no trace of a company actually called Priority Express that I could find. And surely if there were, FedEx would not have granted them a license to use one of the most famous logo marks in history.

Inside we discover a veritable treasure chest of behavioral psychology. When I was in Spain, I had the good fortune to be staying with a marketing student from England thanks to AirBnB. I introduced her to Seth Godin by boldly claiming that he was part of a “good” marketing movement, one where customers get treated with sincerity and respect. I wish I had this envelope with me because this is precisely what it means to go to “the dark side of marketing.”

They pulled out all the tricks on this one. So let’s break it down, we may as well learn something here. I’m interested to see what others turn up.

The header immediately goes for the near miss effect. We’re close, we’re a finalist! And it addresses me directly, to make sure I know this is the real deal. The potential price is big and noticable with a unique type treatment that distinguishes it from the page. The spinning dials are eerily close to a slot machine display, and to ensure no subtle act is left unnoticed, the last 0 is slightly offset to give the appearance of motion. 

The large font and personalization also trigger something a little more unconscious. Because my name is mentioned here (and several more times later), I am more likely to both remember the company and reflect on them fondly (research). The extra printing and distribution costs do not justify such a move without a considered intention.

Our call to action urges us to contact the promoter. And like any good landing page creator knows, any friction between me and the finish line has to be removed. I’m given a phone number, a personalized website, and even a QR code. Since I’m a glutton, I had to call the number. The IVR system immediately prompted me for the pin number. Customer tracking in the offline world is still a little cumbersome, but I played along. Surprise, there are no agents, the office is currently closed. But I’m sure my mailbox won’t be.

What good call to action would be believable without a testimonial? Nothing builds trust and integrity like a previous winner. The picture is of a guy holding a giant check. That totally makes sense when the grand prize is a $10,000 debit card. Jimmy Olaventa Birchfield doesn’t sound made up either. I always use my middle name when I win prizes. If you like gambling, then a credit card is just up your alley. This is the perfect primer for making someone willing to spend and, when they do, spend more. Something about a credit card just screams freedom from constraints, a way out to get what you “need.” My local grocery apparently doesn’t accept Platinum Preferred though.

I’m a guaranteed winner. For their part, a measly $150 is a swell price to pay to convert on selling a car. How can I turn down the opportunity to at least find out more? I’m sure we’d learn that the winners only qualify with a purchase from the lot. Unfortunately, I’m left to jump to that conclusion since all the agents seem to be out of the office. The promotion has clearly defined their target customer. Scratch-cards and their ilk appeal heavily to low-income households, a well-studied phenomenon in state lotteries. We’ve already been guaranteed a prize, so this one is just for entertainment. I suppose the target demographic would be thankful for the freebie.

First make me feel lucky, then make me feel special. Invitations are a wonderful way to build exclusivity and artificial demand for your offer. I ran a community website working entirely off invitations, so I can tell you they work well. Unfortunately for us, we didn’t have something engaging to show off once users got inside. Certainly nothing like that new car smell. As we get to the bottom of a page, our salesman begins getting more desperate at the last chance to close the deal. Here is the offer that I can’t refuse, a cash money check. Free is the ultimate seductress, and this one is calling my name. Yes, I choose a free check for $4,266.79 over the $0.25 Lindt truffle.

I suppose if you’re going to go dark side on me, then you may as well go for Death Star. But next time Landers, you might try not sending your offers to such a blatently wrong demographic. No one in my neighborhood gambles, we play Poker.

TLDR: When you’re selling, you give the first price. When you want to be sold, give them the lead. 

How much?

It sounds simple, but it’s one of the hardest questions in the world. So hard that the entire finance industry was born into endless capitalistic warfare upon itself. The winners exert unimaginable world power, and the losers are driven into permanent obscurity (if they are lucky). The most challenging aspect of consulting has been answering that elusive question.

You can ask what others charge, you can debate what value you’re providing, and you can consider what the other party is willing to pay. Either way, the decision takes an unbelievable amount of information. You need to know thyself, thy partners, and thy enemies. If for no other reason, this is where a professional sales person can be invaluable. The knowledge and experience in their modern-day evocation of traders is essential to finding a fair deal.

The choice of who begins the negotiation is hugely important. Opening can be a minefield: start too low and you’ll leave value on the table, start too high and you risk not even being in the discussion. The first number is the priming point from which all other negotiations evolve. As in any game, one player has to start and starting is often the most difficult part.

I’ve let some opportunities escape my grasp lately due to poor negotiation tactics. I have no doubt that there would have been a mutually beneficial outcome had we started in a different place. But being inexperienced in negotiating such a deal meant that I didn’t quite know what it would look like from the outset. Given that I wanted to do these projects, I think the cardinal mistake was to start the negotiation game myself.

The general rule of thumb is to never give the first number. When you do, what you’re really saying is that this is my ballpark. I’m happy to do the project if you hit the ball somewhere in my field, but I’d otherwise decline. So if you want the work for reasons beyond price, I think the best strategy is to defer to the other player to start. When they decline, capitulation is not an option. Instead, let them know that you’re excited about the project and you’d like to find a way to fit within their budget plans. You have imperfect information, and you’re going to screw up if you start. 

The other side of the equation is when you don’t really want the work or if you’d be indifferent if you landed it. At that point, you should start the negotiation yourself. You want to prime the first number so that the ballpark is in a place where you’d no longer be indifferent. This is the conversation rate scenario where you’ll go through several potential suitors and land one. Losing the others isn’t a big deal because you didn’t want the work at that price anyway.

If it were all about making money, you’d just need to tune your lead generation and closing engines. But at times, there’s something more. Whether it be the people, equity, experience, or even future favors, there can be many more components to a deal than price. I regret my last encounter, but I think the lesson is clear. When you’re selling, you give the first price. When you want to be sold, give them the lead.

A thought from a previous generation as we set sights on Mars.

Interestingly, I ran across this Letters of Note on Twitter this morning: 

This day in 1969, a chilling memo titled “IN EVENT OF MOON DISASTER” was sent to President Nixon’s Chief of Staff.

TLDR: What will the heaps of data being recorded about us breed in the recountings of future historians?

I don’t go outside much, probably less than an hour a day on average. Some combination of being introverted, obsessed, and indifferent to most novel experiences keeps me out of the sunlight. Between being a programmer and getting my entertainment from places like Netflix or game consoles means I never have much reason to leave a building. I know this would drive many people insane, but I suspect there are also many people just like me. We toil away, day in and day out, on our digital devices, perfectly content with life.

So for my kind of people and the many more of us which are being born every day, I’m curious what a future historian will uncover about our lives. We leave breadcrumbs stored away in databases with our every action. Our discussions, thoughts, motivations, and actions are being recorded in real-time, every time. And a clever researcher with access to many of those stores of data will be able to quite accurately paint a detailed portrait of our lives. Extensive enough to put any biography to shame.

One hundred years from now, what will history classes say about our modern day legends. They will have such copious amounts of information that there may not be any secrets or questions left, there may be no reason to conclude that their achievements were in any way superhuman, revolutionary, or magical.

There is a mystic around my personal heroes. Alexander the Great, Leonardo di Vinci, and Benjamin Franklin, to name a few, did remarkable things in their lives. But more importantly, their accomplishments are set in a magical aura, not for what we know about them, but for what we don’t. Without that magic, will there be legends?

Month in Review

A late month in review is a good month to review. This month, we started looking for marketing help and I doubled-down on the consulting business. The work we’re doing on our current client projects is damn good, so I know we’ve got a product worth selling. More importantly, we need to grow our team to tackle even more interesting project ideas. 

This month I’ve put myself in front of many new prospective clients. Discussing their problems, goals, and aspirations has been a pretty enjoyable experience because we’re in the unique position to provide a solution. I love when conversations are about how we’re going to do it instead of we should do it. As a technical guy, I can give real-time feedback on what’s possible, how hard it will be, and when it can be done. To be honest, it seems like sending a sales guy to have that conversation would be a nightmare in comparison.

You’re sending the wolf?… that’s all you had to say.

Don’t get me wrong, I’ve worked with some epic sales guys in enterprise software. At that level, having a professional sales guy who can walk customers through the value propositions of complicated solutions is pretty useful. But on the smaller side, for small and medium-sized businesses, they simply cannot answer the unanticipated questions that are needed to build trust. You cannot rehearse for the diversity of problems faced by SMBs. 

And I’m still not certain where I stand on sales commissions. I feel like they provide an ulterior motive that degrades trust. We want to build amazing software. Thus our motive is to help a business succeed so we can continue to grow along with them. I often ask myself how someone could trust my recommendations if they thought I had a motive to sell them as much as possible rather than give them the best work possible.

Regardless, I think software consulting at the SMB-level requires that you put a creative or engineer in the room with the customer. A pure-bred sales guy may help for later negotiations, but right now I feel like they are going to do more damage than good.

On a Personal Level

Over the last four months, I’ve managed to reduce my personal expenses by more than half. When you take a hard look at what you’re consuming, it’s amazing how much you can do without. There are a few more dollars to be squeezed out, but at this point I’m not putting much more effort into optimizing my monthly nut.

(Protip - Go to the ATM to get your pocket change for the week. It’s much harder to see where you’re at when you use a credit card for everything)

My last subscription services are Netflix and Github. That should tell you something about how valuable those two things are. Amazon Prime is amazing too, but we have access to that in the family.

One service that I’d like to see built is a come-to-market tool for Kickstarter campaigns. Our experience as a large pledge for Elevation Docks has been a bummer. There are delays, I get that, but the communications and expectations aspect has been touch and go. The big problem is that these companies find brilliant success through their Kickstarter campaigns but are left with no way to deal with the scale of new business. I smell a great opportunity to build a PR/support/shipping service around these campaigns to ease their burden.

We could wax on about new ideas all day, so let’s get to the numbers.

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Revenue
$9,000.00 (unc) Services
$64.76 (-$85.24) Merchandise
$9,064.76 (-$85.24) Total

This month we didn’t sign any new business, and we wouldn’t have been able to work on it anyway. Our pipeline is completely full and it looks like we’ll fill up the rest of this year’s calendar soon. (also, here’s my SEO donation Regions Bank, let’s do this thing!)