The fastest way to save yourself a few million dollars.
By Damon Pace | October 12, 2007
In my 8 years in the web business, I’ve seen a lot of web companies raise some serious cash to build a cool website. Everytime I see this happening I scratch my head. They typically go on a spending spree and buy some really nice office space, furniture and recruit a team of developers to build their cool new website. Why? Because that’s the way they & their investors think it has to be done. Well I want to talk a little about a different strategy that can be applied by anyone looking to build a new website. No, I’m not talking about off shore developers. They are usually a waste of time and they really don’t save you any money in the long run.
The Basic premise: Design first, keep it simple, then develop.
This is a costly lesson to learn if you don’t know it in advance. Never, never, never tell a developer an idea and send them off to develop it for you. They won’t get it right the first time and you’ll be destined to redevelop, redesign and hack around the developer walls they put up. You need to show a developer, not tell them. This is the secret sauce that can save you a ton of time and a lot of money.
The old saying of “Start with the end in mind” is very true when developing a website. Think about it. Why do you build a website? To get users to it. What will they do once they get there? They’ll interact with it. So why not start with that and focus on the “User Interface” first. Go upstream!
User Interface is essentially the look, feel and flow of the website. It’s far cheaper to design the UI first, than to develop first and then design around that.
It’s the reason Estately can develop a great home search experience with only a 2 man team. It’s also the same reason other companies take 8 months to add a relatively small feature to their website and they have a full team of developers, designers and millions of dollars behind them.
Don’t take my word for it. I’ve found an ebook from 37Signals.com that spells this theory out clearly. They’re the ones who basically created Ruby on Rails and a boat load of killer online software applications with only 7 developers. It’s worth the $19 investment to learn how to build websites like the gods.
Also, Seth Godin just touched on this a few days ago as well. Check it out here.
Author's Website: http://www.incredibleagent.com
7 Responses to “The fastest way to save yourself a few million dollars.”
Comments
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October 12th, 2007 at 9:37 am
Damon, glad we can serve as an example! Sometimes we think that having a couple more than 2 people might be nice, but I guess we’re doing pretty well with 2.
PS: We didn’t get a dot com on that link!
October 12th, 2007 at 9:43 am
Galen, of course you’d like more help. So would I. You’re still kicking butt without it though. Keep it up.
PS: Fixed the link.
October 12th, 2007 at 9:58 am
Are there companies that raise a great deal of money and then blow it in an irresponsible fashion? Sure. However, most companies that raise capital are building a business, not a web site. Marketing Directors, CFO’s, salespeople, administrative staff etc. etc. etc. They need to get paid just like web developers do and that’s where the bulk of the burn takes place. At some point even Galen is going to need to bring in the bodies to keep up with what he’s doing. Great development is fine but nothing happens in a business until somebody sells something and 2 guys in a garage can’t provide sales, accounting, customer service etc. Trust me, most investors these days know exactly where the burn should start and end and it doesn’t all get spent in the room with the empty pizza boxes and red bull cans.
October 12th, 2007 at 11:12 am
Michael, I agree that most successful companies need more than 2 people and that it usually requires capital, but there are a lot of internet companies that get so excited “building a business” that they actually neglect their business, which is building a compelling website.
I think there is a happy medium between the 37 Signals no-vcs-ever mantra and the business-dude-writes-up-a-huge-business-plan-and-gets-it-funded-before-he-even-starts mantra. This is not the late 90s; trying an internet-based business model is exceedingly cheap!
October 12th, 2007 at 11:17 am
Mike, I completely agree with your point, but the point of my post is to highlight the need for people to understand how to develop a website…not a business. Many of these funded 2.0 companies have no idea how to develop a website. My post was to address web development theory and not business development theory.
October 12th, 2007 at 4:23 pm
Guys,
I like your analogy Galen and think you’re dead on when you identify the positioning required to succeed as in between 37 signals and the “business dudes”. I disagree about the “exceedingly cheap” part though. It’s not cheap to start any kind of business these days 
In any case, here’s one Geeky Business Dude type that’s rooting for you, I really like what you’re doing.
No doubt things have changed. Look at Guy Kawasaki, He had a Truemors built for 12 grand. Luckily enough for him he is Guy Kawasaki and that alone is all the PR he needs to get it off the ground. While it may not take as much to get a good Internet start up off the ground these days, one thing hasn’t changed, revenue. Like I said before, nothing happens until somebody sells something
October 12th, 2007 at 4:36 pm
A side note and not to provoke argument so much as to express myself. Truemors is awful. If it were launched by anyone with less popular blowhard status, it would be so empty that no one would even notice it enough to make fun of it.
First, to say it only cost $12,000 is silly; I would pay Guy Kawasaki $50,000 for half of the publicity he has given it and I’d be getting an incredible deal. So yes, it’s easy for popular internet dudes to start copycat sites and direct people to them. Second, a $12k personal glamor site is not a business, it’s something a popular internet dude can use to get more speaking engagements.
Paul Graham is my cheap startup hero. He’s one of the only people online who writes intelligent, well thought out articles. (I do not count myself in that group).
http://www.paulgraham.com/articles.html