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Closing the Bridge Between Marketing and Technology, By Luis Fernandez

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Closing the Bridge Between Marketing and Technology, By Luis Fernandez

The business of software: Code and Cash Live Closer Than You Think

Posted on April 26, 2012 By Luis Fernandez

Software as a business sounds clean on a slide. In practice it is coffee stains, pager buzz, and the chat ping from a paying user who just hit a wall. That ping showed up for us at two fifty nine in the morning. A checkout event with no payment captured. A webhook had gone silent. We chased logs, found a timezone drift, and shipped a fix before dawn. The bug was small. The lesson was not. Code and cash live closer than most people admit.

Two days ago Google rolled out Drive and our inbox filled with customers asking if we would sync. Facebook just bought Instagram and our investors are asking what our mobile story looks like. Every week the board wants growth. Every day the app wants care. If you are building SaaS or any subscription product, you are running a business that just happens to be code.

From a midnight fix to a morning win

That night we learned a pattern. The fix that saved the day was not a clever patch. It was a checklist. After that fire we added three things. We log every billing event with a unique id. We alert on any gap between checkout and capture longer than five minutes. We send a friendly email to the user if the payment stalls, telling them we are on it. The next time the same glitch popped up, the system caught it before support did. The user got a clear note. No drama. That is the shape of a healthy loop. Detect, inform, recover, and learn.

The technical middle that pays the bills

Measure the first mile

Most funnels leak at the start. Signups arrive from search or a link on Hacker News. They click around and bounce. Track the steps that predict success. In our case it is project created, data connected, first teammate invited, and value seen on the dashboard. Pick your own events but keep them few. Use Mixpanel or KISSmetrics for events. Use Google Analytics for pages. Set a goal for time to first value. We aim for under fifteen minutes. Every minute shaved shows up in activation and later in retention.

Onboarding is product not email

Email has a role. Transactional notes from SendGrid or Postmark help. Drip tips from MailChimp help. The win sits inside the app. Guide the user toward a simple victory. Hide everything else. A calm empty state with one clear action beats a cluttered dashboard. Show progress. Celebrate the first success with a small in app moment. Keep the tone human. Use feature flags to ship onboarding changes without a full deploy. Split test steps, not only headlines. The test that lifted our activation most was a shorter setup. Fewer choices. Default paths.

Pricing that tells the truth

Pricing is where you say who you serve. Three plans are plenty. A starter plan for solo use, a team plan where most revenue will land, and a top plan with serious limits and priority support. Do not bury the promise. State the outcome first. Then list limits. Avoid a maze of add ons at the start. That can wait. We publish the price. We do not hide it behind a form. We run a free trial with a credit card up front for some channels and without for others, and we watch churn and paid conversion by channel. The card up front cuts support spam. No card grows the funnel. The right answer is mixed, and your math will tell you which mix.

Watch MRR, new MRR, expansion, contraction, and churn. Watch the payback period on CAC. Keep a simple model. If your LTV to CAC is under three, slow down paid spend and fix onboarding or pricing. If your payback is longer than twelve months and you do not have a deep bank account, pull back. Cash is air.

Reliability that matches the promise

A fast product sells itself. Use New Relic to watch server side performance. Track ninety fifth percentile response time. Log everything with request ids so you can replay a user session without guesswork. Pingdom or a similar service to watch uptime. Set alerts to routes that matter to sales, not only to engineering. If sign up or billing is slow, light up Slack and the pager. Do not wait for Twitter to tell you something broke.

Pick sane defaults. Encrypt in transit. Hash passwords with bcrypt. Rotate API keys. Review access by role. If you sell to companies, expect a security review. Keep a short doc with answers to the basics. Where are the servers. How do you back up. Who has access. You do not need a full audit to start. You do need a thoughtful baseline.

Distribution beats a clever feature

Channels decide growth. Search still brings steady people who want solutions. Write guides that solve a real job and include your product as the easy path. Feed the blog with simple case studies. Get a listing on the Chrome Web Store or the Salesforce gallery if your audience lives there. Integrate with Dropbox and now Google Drive, and send an update to users who asked for it. Record a short screencast. Put a clear call to action at the end. Press helps for a day. Content and integrations help for months.

The manager seat in a product shop

Who to hire first and why

In the early stage, hire people who finish things. Titles impress boards. Shipping calms users. A strong full stack dev who can carry a feature from idea to deploy beats two narrow specialists. A support lead who can write docs, answer with care, and pull a log is gold. Founders sell. Sales learns the pitch and the pain. Do not outsource the first ten customer calls. Those calls shape your roadmap more than analytics.

Roadmaps that respect reality

Think in bets. We keep a rolling six week view with three bets. One for growth, one for product quality, one for scale. Each bet has one owner and one metric. Everything else goes on a later board. This keeps the soup from boiling over. We share the board with the team and with a few friendly customers. When we slip, we say so. Trust builds fast when you speak clearly and ship often.

Support is a profit center

Fast, kind support closes deals. We run Zendesk with tags for themes like billing, setup, and bug. Every tag is a hint at friction or an opening for a feature. We track first response time and time to resolution. We do not chase vanity scores. Every week we share the toughest three tickets with the whole team. Support is the shortest path to a better product. Also the cheapest user research you can buy.

Finance that does not bite later

Send invoices on time. Reconcile daily. Treat annual prepay as a promise, not free money. If you can, bill yearly with a fair discount to pull cash forward. Keep a small reserve for refunds and card failures. Automate dunning with clear emails and a one click card update. Circle back to anyone who churns. Ask why with a short survey and one open question. Close the loop by fixing the top reason and announcing the fix.

Say no without burning bridges

Big logos will ask for custom features. Some requests are a roadmap in disguise. Others are traps. Ask three questions. Does this help at least twenty percent of users. Will it move activation or retention. Can we ship a slim version fast. If the answer is no, offer a workaround or an integration. Save custom work for deals that pay for themselves and fit the story you are telling.

Field notes that stuck

  • Simple beats clever. Fewer choices lift conversion. Defaults sell.
  • Speed is a feature. Time to first value drives everything else.
  • Price with courage. Raise price when value grows. Do not apologize.
  • Own your numbers. Daily MRR report. Weekly churn review. Monthly cash view.
  • Guard attention. Every alert has a cost. Cull noisy checks.
  • Write it down. Runbooks for deploys and paydays save nights and nerves.

Your move this week

Reading is cheap. Change is where the money is. Here is a short challenge you can finish in five days.

  1. Pick one activation event. Define it in ten plain words. Add tracking for it. Set a daily goal.
  2. Simplify your first screen. Remove one choice. Add one clear button that leads to value.
  3. Clean your pricing page. Three plans. Plain language. No dark patterns. Publish it.
  4. Send a rescue email to anyone who stalled at checkout. Offer help and a quick call.
  5. Talk to five users. Ask what almost made them quit. Fix the top item and tell them you did.

You do not need a new framework for this. You need a list and a calendar. Software as a business is a game of many small edges. Get one this week. Then another. Soon the graph curves in your favor.

If you are wrestling with a specific snag, drop me a note. I might have a scar in the same spot.

Business of Software Software Engineering

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