The 'Accidental' Software Company
Entrepreneurs are natural innovators and ‘idea people’. Sometimes, the innovation is outside of the core skill set of the entrepreneur, and when the solution to the problem is creating a new software product, for non-technical founders, this poses a rather large hurdle. So what initially feels like… “Great news! We’re in the software business” quickly turns into “But now we have to become a real software company.”
At NeuEon, we’ve helped a number of clients move from great idea to full blown software solution. In this post we’ll cover a few of the smart strategic alternatives to getting your product to the end goal (paying customers).
There are a number of paths that companies take to develop a software product.
1. Outsource it!
Outsourcing software development has become as common as buying something on Amazon. In some cases, for small software projects, it is as easy as setting up an UpWork account and finding a qualified resource to make it happen. But if you are developing a more complex product, outsourcing can get a more involved. Usually it involves choosing a vendor that best meets your needs and budget. There are a few questions to ask when contemplating this route:
- Who is going to run the product development team?
- Should you go offshore, onshore, nearshore?
- Do you understand the roles needed to develop a product in a modern manner: visionary, product owner, scrum master, team (that one is easy).
At NeuEon, we subscribe to the agile development school of thought, specifically Scrum. Scrum is well understood by outsourced teams but rarely executed well. Having confidence in who is leading the effort and the knowledge base they bring to the table in order to adequately manage through the process and hit milestones efficiently is paramount to success.
2. Go it Alone: In-house development
For most companies not in the software or product development business, running a software development operation is daunting. It takes a team with diverse skill sets to come together and mesh/flow efficiently. Orchestrating developers, creatives, and quality assurance folks in your company requires a certain level of intestinal fortitude and management expertise that should not be underestimated. For this reason, many business founders and executives seek expertise outside, so the core internal teams can focus on other aspects of the business.
3. Meet Halfway: Hybrid Development
The hybrid approach is favored by organizations that like to own certain aspects of the process. Generally this is more the vision and product owner roles. This is generally a good approach if you have in-house talent that can fill the roles and a good outsourced team to do the work. Regardless, if the internal and external teams aren’t meshing and communicating effectively – the program can quickly go off-track.
All of these approaches are valid options, but fully understanding some of the best practices of online product development will help you along the way.
Tried and True Strategic Best Practices
There are many different methodologies to choose from, at NeuEon we are partial to scrum because it’s proven. Scrum is standardized and well understood by most developers and development companies today so we have a common language and process to work from the start.
Bottom line: Pick a development process that works for you.
Product vs. Project:
Building a software platform is not a project, it doesn’t end. Once you give birth to a software product, it needs care and feeding for its entire life. Be prepared to budget for the product year after year, not just the first year. There are a myriad of costs that go into a product outside of the development costs. Infrastructure, testing, support, compliance, tools, and security are just a few examples. Top of mind should also be the revenue side of the equation. Every pro forma budget we build for clients also shows how they’re going to make money on the product they are developing.
In the late 1990s, NeuEon discovered the miracle of something called multi-tenancy in Internet software platforms. This was a concept of building platforms that house all of our customers on the same platform so we can take advantage of scalable Internet infrastructure.
Infrastructure As A Service:
Self hosting your product is a non-starter and the hosting landscape has radically changed in the past five years. Understanding how to leverage infrastructure as a service is key to running an efficient online product.
Development and Production Operations:
The shorthand of “devops” covers much of the technical operations that online products rely on to function in a scalable and reliable manner. These are specialized skills that you may not need in-house but when you have them, you will sleep better at night.
This is just of short list of musings on the “accidental software company” topic, but this will get you started on things to think about when you contemplate becoming a software company – as always – we are here to help.