It’s not as easy as you think getting your pitch/message down to a few very clear and concise words. I’m pitching our website monitoring startup again. This Pitch is part of a national Pitch competition. Click the links to see my last pitches: Understanding Pitching and Learning to Pitch. We’ve been short listed based on our application form. All the hard work we’ve been putting into our Website messaging is really starting to come through. Our message must be improving.

Churchill. Good with words.

Like a marketing strapline a pitch needs to be boiled down to a very few key words. It says what your company does and what you stand for. This message is then developed into longer pitches to include more and more detail as required. 3 second, 30 second, 3 minute pitches, etc. Its a bit like a pyramid of descriptions with the shortest and simplest pitch at the top. This structure brings consistency and clarity. Ultimately the culture of a startup is formed around the principle messages and values formed by the founders. In this way employees, customers and investors understand what your company stands for.

How we get on today at The Pitch competition is important but its not critical. Its the journey that’s the useful part. Improving, testing and refining our message is the reason to pitch. Although the £50,000 worth of prizes would be nice. This practice is preparing us and our message for potential customers. After all The Pitch panel will not be buying our product, customers will. Keep pitching – practice makes perfect

As you can imagine the subject of website downtime/slowdowns is very close to my heart. Our startups new app monitors websites for uptime and performance. The full impact of Website downtime has just really hit me. This week part of The Pitch website frustratingly went down. On the same day the premier Web host provider Rackspace had a full hours outage which impacted many, many websites. These failures got me thinking. How common is downtime and what are the downstream effects for both ecommerce and SaaS apps/sites?

Customers get angry when web pages are down. Don’t blame them.

Sh*t downtime Happens

As our good friend and Cloud Computing expert Simon Wardley says Cloud downtime is inevitable. Its going to happen. However that does not mean we should be complacent and accept it. Ecommerce consumers certainly aren’t. They’re increasingly less tolerant of downtime. The effects are real. A Harris survey in 2008 found that consumers abandon or switch 42% of all transactions when they have a problem. This is up 12% on 2007.

Also 84%  of online consumers share negatives  experience’s with others (Harris).  Many of these problems are technical and performance related. A reputation which took considerable effort to establish can vanish overnight. The downtime message spreads at the speed of light through Twitter across 10’s millions of users. You can become known for being unreliable.

I’ve done some routing around to find evidence of how common website downtime is. According to Pingdom the average website is down for two hours per month!! That could be alot of visitors or customers lost. Sainburys, a leading UK supermarket, website was down for three hours during one day last year and at various other times. A large number of customers were tracked immediately moving from Sainburys to a competitor.

Downtime costs

Back in 99′ Ebay’s 22-Hour outage was estimated to have cost them $2 Million. The Register figured UK  Website downtime to cost £565m a year in 2002. This included “indirect costs, such as loss of reputation, lost future sales and the cost of storing unsold goods”. Harris says (2008) transaction problems impact £11.9b of sales. The impact of downtime has other downsides. Google penalizes your long term Ads Quality Score when your site or landing page is down.

Despite the interruptions the outlook remains very strong for ecommerce and for other web services.  Cloud/SaaS is forecast to grow massively over the next five years. IDC are saying upto 33% of IT spending growth by 2013!! This growth includes many of the free services such as Gmail, Facebook, etc which we have come to love. As Cloud inertia grows more and more chargeable apps are going to switch to the web.

A very similar downtime and slowdown reality to ecommerce also applies software-as-service (SaaS) apps. Only the churn rate of customers is slower i.e. SaaS users/consumers are on short term billing contracts. The effect is not a immediate loss of sales. Unless they are trying to sign up of course. However the resulting loss of sales and reputation is the same. The Cloud and SaaS apps have much to learn from ecommerce’s 15 years of experience. And ecommerce still has a long way to go.

]]> http://nickpoint.co.uk/2009/07/03/the-reality-of-websitesaas-downtime-slowdowns/feed/ 0 Nick Barker Downtime with Southpark http://nickpoint.co.uk/2009/06/30/5-reasons-to-pick-a-fight-with-your-biggest-competitors/ http://nickpoint.co.uk/2009/06/30/5-reasons-to-pick-a-fight-with-your-biggest-competitors/#comments Tue, 30 Jun 2009 12:55:37 +0000 Nick Barker http://nickpoint.co.uk/?p=2479 ]]>

It sounds like suicide picking a fight with a much larger and established competitor (niche or mainstream). How can you possibly expect to win when they’ve more resources, customers and a mature product? You can’t, easily or quickly!

Rocky IV up against a much bigger and stronger competitor

However there are some good reasons to be compared and associated with the market leaders:

1. Customer knowledge – Customers have a clear understanding of what an existing product does. They can therefore easily pigeon hole your product into the same or similar category. “oh, your like ACME’s product”. In this way a sale is easier because less explaining is  necessary.
2. Free-riding education – You can ride on the competitors market education. Educating customers is very, very, very expensive and time consuming. Why not take advantage of someone else’s hard work and cash..
3. Price comparison – Customers will always want a price comparison. Competition is a good thing. Its good for suppliers because it grows the overall market. It also reassures potential new customers. ‘If this supplier is no good I can always switch to another one.’
4. Defecting customers - Unhappy or dissatisfied customers will need an alternative. Put yourself in that position and you will catch them. The crumbs from the competitors table maybe healthy loaves to your startup.
5. Out innovate – Find the weaknesses in the competitors offering and improve it with your own. Many a market leader has been toppled by a much smaller innovative company. Startups are better at innovating than the big market leaders.

A word of warning this strategy may also get you a bloody nose. The competitor has the lions marketshare and so you have to make alot of noise to be heard.  If you do get noticed by the competitor move quickly to establish a position of strength because if they attack it may be a killer blow. You may also start a price war which is ultimately no good for anyone except the customer in the short run.

Competition is a good thing. It demonstrates there is a need in the market for a product or service. Rarely is there an new opportunity without competition. If there is no competitors you have to ask yourself is there really ‘a market in this gap?’ As a small startup you have to out-compete your much larger rivals.

Battling against competitors really requires the Art of War. Strong knowledge, great tactics and an outstanding strategy is needed. Its not easy. Often startups have no choice. The odds are not on your side but that does not mean you won’t be successful. Startups are more agile than established bigger suppliers.

I’m starting to sound like a Brad Sugars fan.  The thing is he makes some good sense. Brad seems to have a strong understanding of people and business. This was learnt from being an entrepreneur since a teenager. He’s put this knowledge to good use and has been successful.

Like me, Brad has a passion for learning. In this video Brad talks about the five stages of learning to truly become an entrepreneur:  (0) Employee (1) Self employed (2) Manager (3) Owner (4) Investor & (5) Entrepreneur.

CAUTION: Brad will try and sign you up to his coaching service

I have repeatedly talked about the importance of learning in this blog: ‘The spirit of Entrepreneurship‘ being in us all; learning how to pitch an idea through repeatedly trying and failing; learning  to over come your fears to live your dreams; Rachel Elnaugh’s learning experiences; and anyone can learn to be a designer.

The one thing we can’t make more of is time and learning takes time. If your not fulfilling your learning potential start now. Learning is the source in life!!

From the 100’s of photograph’s taken during the FOWA Tour for the Sun/EveryCity’s photothon competition I managed to reach third place! Thanks everyone who voted for me and the tall Aware Monitoring hat made by my daughter and I.

The winner was Laura Kalbag with ‘EveryCity soul’:

In second place was Jamie Rumbelow with ‘We are EveryCity’ :

And in third place me (Nick Barker) with ‘A tall EveryCity story’:

It was a great competition from Duncan Malcolm and the team at EveryCity – well done!! I look forward to the next one.

Here at Aware Monitoring HQ we’re moving rapidly towards launching our website monitoring service.  But what is the best and most effective way to launch a web/SaaS app. I’ve trawled through the Internet and talked to several of my startup friends for ideas. To get some practical launch hints and tips my co-founder Simon Oxley and I met-up with the founders of one of the UK’s and worlds top 50 startups – Huddle.net.

Huddle started providing on-line shared workspaces in 2006 and launched in 2007. Since then they’ve attracted 100,000’s of users, secured two rounds of VC funding (Eden Ventures) and partnered with LinkedIn/InterCall.  The team also regularly presents at US and UK conferences.

An Awesome Launch pad!

Depending on your budget, location, contacts and available time there are several ways to launch:

1. Live on stage!! – Launch big at an specialised startup launch event such as Demo or TechCrunch50. Lots of Tech press and investors will to be there all looking for a scoop on the next big thing.  Andy McLoughlin and his co-founder Alastair Mitchell from Huddle launched at Demo in 2008. The catch is its not cheap. This years Demo costs $18,500! Andy & Ali did get one really good customer though.  Also these events are US only.
2. Shhhhh…. – No razzmatazz, just quietly leak your new app into the market. Its cheap and there’s no high pressure expectations from new users. The bigger the launch, the harder the fall if the users don’t like it. A quite launch means you’ve got time to get the app right with users. However keep your fingers crossed that your target community hears about your new app and the word goes viral. Bloggers can help to spread the word when your ready.
3. Conference bandwaggon – There are a ton of localised Tech conferences where you can launch. Some of them have launch pads especially for startups. To name but a few conferences: Web 2.0 (USA), Le Web (France), Office 2.o (USA), FOWA (UK), etc. These conferences are much cheaper than the big Startup launch events, however the message will not have the same impact with the press or investors.
4. “Read all about it” – Press releases are a well worn route when launching. Target the press you want to been seen in and engage with PR freelancer/company. Or take the cheaper option try and contact the press yourself. Unfortunately they are so busy they will rarely listen unless its someone they know.
5. Stand on preachers corner – Talk to everyone who will listen: friends, family, ex-colleagues, first/secondary degree contacts, etc . Everyone and anyone! Forums and communities where your target users hang out are also a good place to engage. But DON’T sell to them or they’ll kick you out. This options cheap and targeted.

With or without a bulging budget its hard to be heard above all the startup noise. Although there are 65% less new startups right now. Which ever way you launch one of the most important things to remember is engage with real could-be customers as early as possible. Customers ultimately equals profits, whereas Tech community does not necessarily. Here is a good (but long) talk on launching/early customer engagement from a wiley old Valley Tech startup vet, Steve Blank.

It may seem a little strange that I’m talking about quitting when our startup is on the verge of releasing a new product. Don’t get me wrong,  Simon, my co-founder and I are full of  confidence, excitement and anticipation. However, just as there is a thin line between insanity and entrepreneurship, there is a fine balance between failure and success. It is important that the entrepreneur  knows when enough is enough and its time to restart. This is normally when customers and investors don’t believe in the idea any more.

Entrepreneurs are well known for their determination and tenacity. They have to be thick skinned to survive the startup emotional roller coaster. However there is no point in flogging a dead horse (startup). Once a new venture is started it can be difficult to see the difference between a set back or an idea that will never fly. Seth Godin believes that successful entrepreneurs know the difference between a dead-end and  natural dips.

A dead entrepreneurial cowboy on a dead mount

The blog post, ‘It’s Time to Shooting your blog (horse)’ also applies to startups.  “In the case of blogs, their purpose is to transport your ideas across the world.” I almost quit with this blog in October 2008 but continued. Since then I’ve enjoyed some success. Success is about fulfilling a purpose:

” It is purpose that created us,”
” Purpose that connects us,”
” Purpose that pulls us,”
” That guides us,”
” That drives us,”
” It is purpose that defines,”
” Purpose that binds us.”*

The purpose of a business is to make healthy profits. Sounds obvious I know. However many become deluded with other ideas. Notions of  business is for fun, friendship or getting rich quick. Of course there are many ingredients that go into making healthy profits. These include pleasure, trust and vision. But the overriding goal of a business must be healthy profits. Everything else comes secondary.

We all know that customers and a good business model are the route to healthy profits. Jonathan Morrow from Copyblogger and author of ‘Its Time to Shoot your blog’,  believes the key measures for blogs are  communication from readers, links and the writers intrinsic motivation to write. The key measure for any new business is  the number of quality customers. This is measured throughout the sales funnel: Leads-> Conversions-> Customers-> Transactions-> Actual Sales-> Revenues-> Margins-> Profits.

It is the startups founders vision and persuasiveness that convinces could-be customers and investors to join the venture. So if a startup is unable to attract customers and investors in sufficient numbers its back to the drawing board to change the idea or message. However don’t give up too early either. Its a fine balance between success and failure.

Many believe that a big lucky break is just around the corner with their startup idea. However it may never come if the money and customer/investor interest runs out. In the same way as we have to shoot the blog we need to  shoot the startup before its too late. As painful as that may be. Its better to learn from failure  and use that knowledge than keep flogging that dead startup idea.

* Matrix reloaded 2003

Phew – the inaugural whistle stop Future Of Web Apps (FOWA)  UK Tour has finished. I attended 3 of the 4 Tour stops: Leeds, Cambridge and Bristol. The Tour was a condensed version of the highly successful  Carsonified FOWA conferences. This was the first time  Carsonified had taken the UK tour on the road. The aim of FOWA is to help developers, freelancers and entrepreneurs learn and socialize. On the Tour we met many wonderful people and heard some great talks.

Taking the Tour out of London (a conceptual London bus)

The Tour followed the same format for each venue: big company demo in the morning and other talks in the afternoon. This was followed by speed networking and then drinks in the evening. The demo from Microsoft’s David  Gristwood was on the Azure’s solid architecture and road map; Simone  Brunozzi  from Amazon Web Services gave a very useful demo of EC2/S3; and Doug  Merrett/Simon Wheeldon from Salesforce.com showed how simple it was building an app on fly with Force.com. Tony Lucus of Flexiscale also demonstrated their Cloud platform at the Cambridge event.

Many of the attendees I spoke too at each event felt that the corporate sessions were too much of a pitch. I guess they were sponsoring the event to keep ticket prices  down. The managed hosting providers EveryCity also sponsored the Tour and took heaps of photos of attendees wearing EveryCity stickers in the most unusual places:

Nick Barker
(Some will do anything to get their photo taken
vote me & silly hat to win, click here )

2st Stop – Leeds – “Fares.. please”

Simon  Collison from Erskine Design gave an entertaining talk about building client trust. Simon high recommended involving customers in an Agile feedback loop to create a usable app. An important point we need to remember. Dan Rubin then gave a wonderful talk on designing intuitive user interfaces which mimic non-frustrating real world physical interfaces. Dan used great images of taps, buttons and door handles/locks. Like his slide deck: Keep it simple, don’t over design and “don’t give instructions to users” – if you do the apps not intuitive. Next up was Lorna Mitchell, a senior developer  from iBuildings, who talked about developing in PHP and database architecture. Click for Lorna’s slide deck. Finally Ryan Carson of Carsonified gave an excellent talk on marketing web apps through on-line measurement and building social capital. Ryan’s slide deck to follow..

3rd Stop – Cambridge – “Hold tight..”

First up was Wil  Harris of ChannelFlip with a wort’s n’ all presentation on “Lessons learned starting a successful digital media publication with no budget, no technology and no idea”. The key message was start something, NOW! Then learn and iterate. With an offering in 87 countries Stefan Magdalinski of Moo.com gave an insightful talk about scaling and growing an international business. The American market proved to be the most demanding. Dorothy Briggs of Rabbitsoft then gave a talk on using Web2.0 in the Enterprise. Our startup knows all about Enterprise 2.0. Last but no means least was the charismatic German Christian Heilmann from Yahoo. Christian gave an enjoyable and entertaining talk on Yahoo’s exciting YQL API platform. The Tech crowd loved it!

4th Stop – Bristol – “All alight”

Our good friend Andy McLoughlin from Huddle give an excellent talk on partnering. Click here for Andy’s deck. His advice to finding partners was as to über network and get lucky. Once found, partnerships take  a long time to develop and can be challenging to finalize. You also need the ability to scale rapidly.  The next presenter was Ian Broom of Weboo. Ian give a useful reminder on goal setting, having fun and staying fit to be being super effective.  Richard Healy from BaseKit then gave a talk on their exciting new DIY website building app. Like our website monitoring app they are also  in alpha Last up was Dan Rubin again, who gave a very similar presentation to his outstanding Leeds talk.

The speed networking was very intense. After the sixth person I generally started to loose all ability to speak.  However it was good to meet so many people in such a short period as we made some great new friends

I last attended a 3 day London FOWA in 2007 and taking FOWA into the regions proved to be a great idea. It shows there is startup life and thriving web community  outside of London. Roll on the next Tour!

Here at Aware Monitoring HQ development of our Website monitoring service continues at break neck pace. If you have a website that’s important to you this service will be of use. We are now rapidly moving towards our closed alpha and need beta testers to try out our new web app.

If you’ve already signed-up thank you. If not click here. All we need is your name and email. We’ll drop you a line when the beta is ready. Don’t  worry we won’t spam you or give your email address to anybody else. This is so exciting

“It is true that there is a fine line between entrepreneurship and insanity. Crazy people see and feel things that others don’t. But you have to believe that everything is possible. If you believe it, those around you will believe it too.” Anita Roddick *

The Mad Hatter from Lewis Carroll’s
Alice in Wonderland (Sir John Tenniel,
1865. Wood-engraving by Dalziel)

Many of my  friends think I’m as Mad as a Hatter! I gave up a well paid stable job to pursue hare brained ideas. And I continue to spend ever increasing amounts of money without return. They say, “I just don’t understand.” or “it makes no sense.” Not many people working in comfortable jobs seem to understand. They see only danger and risk. However I don’t see it as risk but as opportunity.

The academics say entrepreneurs don’t see their actions as taking risks. The entrepreneur sees their decisions as calculated judgements. “isn’t it a risk staying in your job year after year” I heard. My more sympathetic friends tell me how brave I am having a startup, especially with a young family. In fact, people have been telling me how ‘Brave’ I am for years. Like when I moved to London OR when I left a well paid job in London to go traveling for a year.  “I wish I could do that”. Well you can!! Live your dreams and don’t let fear rule you.

Are entrepreneurs mad or unstable? Is there something  more sinister lurking in the mind of startup entrepreneurs? I think not. Insanity, craziness or madness is described in Wikipedia as “the behavior whereby a person flouts societal norms“ and “defective function of mental reasoning”. As Anita Roddick put it so well- “entrepreneurship is about beliveing and seeing things that others don’t.” Its having a dream of how things can be. This is the Successful Product dream Simon, my co-founder and I are chasing with our website monitoring startup:

Understand the Risks, from Tim Berry’s
Hurdle: the Book on Business Planning

We dream of building something great! A consultancy service is less risky and brings immediate revenues but has a smaller upside. Whereas the product startup needs more time and has much greater risks but also massive potential rewards.

We can all dream of a brighter and grander future. Martin Luth King had a “dream” which is now coming to fruition. Entrepreneurs see a clear pathway into an uncertain future and are prepared to pursue that dream with vigor and determination. Doubters will only believe in entrepreneurs dream when they see it forming into reality. It just takes time before an idea starts to become real.

A final thought: “There’s a fine line between genius and insanity. I have erased this line.”(Oscar Levant, 1906 – 1972). To truly create we must leave convention, the norm and even reality behind. For a while at least