Growing in vs. growing out Jason 28 Jun 2006

51 comments Latest by Arlen

Now that Basecamp is 2.5 years old, we’ve been getting some heat from a few folks who’ve been with us since the beginning. They are saying they are starting to grow out of the app. Their businesses are becoming more complex and their requirements are changing. They want us to change Basecamp to mirror their new-found complexity and requirements.

We’re saying no. And here’s why: We’d rather our customers grow out of our products eventually than never be able to grow into them in the first place.

The problem with following the complexity curve of your customer’s own businesses and requirements is that eventually your product becomes so complex that the barrier to entry is too high for new customers. And then eventually you die with your current customers. You may keep your current customers in the short term, but if no one new can fit through the door then eventually you’re in trouble.

It’s ok for software to be “temporary.” Everything else is temporary, why not software? You probably don’t use the same computer you did 5 years ago. You probably don’t live in the same apartment or have the same car either. And you may be in a different relationship too. Why are software companies afraid if people grow out of things after awhile?

We’re also saying no because we believe in simple tools no matter how complex your business is. People are still people no matter what company they are part of. People still need simple to-do lists, easy ways to communicate with their team, real-time group chat without audio and video overhead, a place to keep notes, etc. A big complex company doesn’t change these small simple needs.

Remember, unless you’re Microsoft there are always more people that aren’t using your product than people that are. Make sure you make it easy for new people to get in. That’s where your real continued growth potential is.

Disclaimer: We are not suggesting that you don’t pay attention to your current customers. 90% of everything we add to our products originates in existing customer requests. It’s more that we acknowledge that people and situations change and we can’t be everything to everyone. Companies need to be true to a type of customer more than a specific individual customer who’s needs may change. (e.g. Ferraris are made for people who like sportscars. If you outgrow your Ferrari and need a minivan then you’ve changed and need to look to another product).

51 comments so far (Jump to latest)

D 28 Jun 06

Very cogent and compelling explanation of your (37Signals) business philosophy.

Scott M 28 Jun 06

“Make sure you make it easy for new people to get in. ” Another way to state your advice is to favor high growth over high margin. There are two ways to make money - with long sales cycles of high margin items to a few customers or short sales cycles of low margin items to many customers. Small software companies will find the best chances of success with the later approach. When you are small, there is simply much more opportunity for revenue increase through growth than incremental product margins and high margin activities bring a risk level (a couple big customers can make or break you) and costs (long sales cycles, higher support costs) that most small, growing companies should avoid.

pwb 28 Jun 06

I know it sounds customer-hostile but I agree with the sentiment. You end up doing the customers a favor by putting a hurdle in the way of their drive towards unnecessary complexity.

Glenn Davies 28 Jun 06

Jason,

I venture to say that those who are saying that they are growing out of your app are coming from primarily two perspectives. First, they have been using BaseCamp for example, in ways that it was not intended to be used. Initially it was cool and simpler, but now their unique use of the app has become to cumbersome to manage.

Secondly, their business model is not in sync with ‘Getting Real’. I don’t mean from an app or software development perspective, but maybe they are trying to overmanage everything and have turned too far to the dark side of too many meetings, more meetings, features, specs, constant business planning sessions et al.

Stay the course boys, there’s more to what you are saying to the 2.0 business world than just building great apps.

Josh Williams 28 Jun 06

This is so very true. We occasionally get asked if Blinksale will grow with a business as they add more employees and salespeople. As in say, over 100 employees.

And the answer is no. We built Blinksale to service smaller companies. If I had 100 employees I wouldn’t be using Blinksale. This isn’t a knock on our own software. It was simply not intended to do that.

And the nice thing is that somewhere, out there, someone is making invoicing software for larger companies. It may be ugly and hard to use, but someone is making it. Just not us. And that’s okay. For every person that outgrows Blinksale, we add plenty for whom Blinksale is just right.

No since bullshitting people into believing your product is a viable solution for their situation when its not.

Kendall 28 Jun 06

And if you’re the best damn app for small businesses there is a huge market for that. When a customer grows out of an app there are plenty of huge “enterprise” pieces of software that they can use. It makes sense to me that you guys (37signals) know where your bread is buttered and will continue to serve that market. The market was there before Basecamp was around, you created this product that scratched the itch. And it continues to. I think it’s well stated, Jason, that the itch for these customers has changed. And I agree that that shouldn’t mean that your product changes. Keep up the good work.

clifyt 28 Jun 06

“If you outgrow your Ferrari and need a minivan then you’ve changed and need to look to another product”

The problem is, software isn’t a Ferrari vs. Minivan question.

Software can be both at the same time and not get in the way.

I’ve taken to gaming again every so often, and its amazing how a game that can start off so simple can end up being very complex by the time you end it — without the game changing at all. You get through the first mission, and you find a new menu item or a combo that actually makes sense (unlike the mid90s fighting button mashers that seemed to have idiot boys memorizing expensive manuals to learn how their characters work).

No, these games have it right. As you start to out grow the old, you are rewarded with just a little more intuative complexity.

I play a game that one of my friends 6 year old sons plays and he sticks with the tried and true and can STILL kick my butt. He is perfectly fine with the limited command set. A bit boring and repetitive, but it works. And this is where I see 37s apps living — tried and true but works…unless you need something more.

What would be so hard about adding a little more complexity to the apps. Something that only power users would ever stumble upon. Some of us love the concepts of the applications, but need just a little more. I know I tried out several of the apps, and they were all just lacking just a little of what I need.

For instance, Basecamp was cool, but Gantt charts are a great way to visualize a concept — yes they add complexity to a project but sometimes they are necessary to show a non-teamplayer (i.e., consultant, external entity, someone you can’t just let go even though you’d love to) — show them exactly how they are effecting everyone elses schedule with their lack of attention. Its also perfect to show to the boss that hired them that one needs to find a new partnet — I don’t know about the rest of you, but I don’t have the pleasure of working with the same group of people everytime, and I don’t get to choose my working groups even if I’m over the project.

There are so many LITTLE things that could be added without harming the application or the initial user experience of just being able to get things done. If it goes against the core idea of the application — sure — but the core idea should be evolving (slowly) along with the users.

I hope to be able to use 37s apps one of these days again — I never really paid for them, so I shouldn’t be complaining, but that was also because it was obvious from the free versions, it wasn’t going to do what I needed — and I too can respect that. I just think there are some interesting ideas and creative programmers at 37 that I’d hate to see them only reserve their applications to the simple stuff because there are a lot of complex apps out there that need some innovative ideas as well.

Either way, good luck…

Phil 28 Jun 06

Why can’t something be simple but offer more for bigger companies as well? I agree with your philosophy of keeping Basecamp the way it is, but why not create another product (“Summit”) that does the more advanced things in a simple clean way? Then not only would you continue to sell to the same audience basecamp appeals to, but also sell to people who need more in the first place, and those who grew out? Software is not like a pair of jeans, for many people it requires training and getting used to the way something works (even when its simple) and it’s a pain to simple grow out of it and move on to something completely different. We love your products and are throwing the money at you, why not build it for us? :)

Mike Rundle 28 Jun 06

“(e.g. Ferraris are made for people who like sportscars. If you outgrow your Ferrari and need a minivan then you’ve changed and need to look to another product).”

As long as you don’t buy a Bentley SUV then I’d say you’re okay. Ugh.

Fresh Mike 28 Jun 06

It’s all about working within your constraints…whatever those may be.

Sounds like Basecamp may have finally hit the wall with it’s constraints. Fair enough. Good of you to know better than to change your constraints for the squeaky wheel.

Knowing and appreciating your constraints is one of the ingredients in building successful web apps. You know it. Josh knows it. We at FreshBooks know it. People like all our apps because they are simple. That’s a fact that is not bound to change anytime soon.

wayne 28 Jun 06

“Why are software companies afraid if people grow out of things after awhile?”

Because the company isn’t really a software company. It’s a sales organization run by business people who see growth as the only measure of success.

Andrew 28 Jun 06

At the same time, how do you handle continued innovation? If Apple took a hardline stance that OS 6 was simple and that’s all their customers needed, then we’d never have OS X today.

Not to say that innovation is tied explicitly to features. My point is that, while I totally agree that BC should remain simple and easy to use, I hope that it does not stagnate and change with the times or with future (and hopefully better) veiws on Getting Real.

JF 28 Jun 06

Basecamp has not stood still, nor will it.

For a good talk about innovation and simplicity see Matthew Glotzbach’s talk at CTC.

Fel 28 Jun 06

Looking forward to your responses, Jason, to clifyt and Phil. I agree with their points. Why not see this as a new product opportunity without in any way changing the simplicity of the original or basic product?

JF 28 Jun 06

Why not see this as a new product opportunity without in any way changing the simplicity of the original or basic product?

Because we’re not interested in building complex products. It’s an opportunity for others, not for us. In fact, *most* products out there in our space are considerably more complex so there’s already plenty of complex options. We’re the simpler option.

Liz Fraley 28 Jun 06

I think the time for software to be temporary (in terms of longevity) is passing. I am still using the one of the same computers that I used 5 years ago; I do live in the same apartment; and, I do have the same car. Upgrading any of these things “simply for technology’s sake” doesn’t make sense.

For that one computer, my needs (my requirements) haven’t changed, my applications still run, in fact, they run with bugs that I know and can accept. Why would I upgrade to something with unknown bugs in it?

In many ways, I agree with Dan Bricklin: There’s no reason that software cannot last 200 years http://www.bricklin.com/200yearsoftware.htm

When my needs or my requirements do change, then I should change. If that’s what you mean by software being temporary (as in, it temporarily fits my business needs today, but some not a different set of business needs that my business may or may never achieve), then I agree. If it’s the other kind of temporary. I don’t.

JF 28 Jun 06

When my needs or my requirements do change, then I should change. If that’s what you mean by software being temporary (as in, it temporarily fits my business needs today, but some not a different set of business needs that my business may or may never achieve), then I agree.

Yes, that’s what I mean. Your use of the software, not the software itself.

Jack Shedd 28 Jun 06

I agree with a few other folks: it doesn’t have to be as strict as “it’s simple” and “it’s complex”. Great software is both. Mediocre software is either one or the other. The truly terrible ones fit in neither camp and attempt to reach some middle ground (better known as not doing anything really well).

Phil 28 Jun 06

Well fair enough, I guess to use your same analogy with cars, that’s the reason Toyota and Audi make everything from a compact right up to a full sized SUV.

You sound like you want to be more like Ferrari, which specializes in just one thing. That can be a great advantage, the only problem is if the winds shift and the trends change you are not very diversified. See Qvale, Rover, Delorean and others that have fallen. I guess one could argue that all your other products are diversifing, but thats more completely different products (ie if GM’s credit arm).

Geoff Longman 28 Jun 06

Fair enough, send me your list of unsatisfied customers and I’ll be happy to take them off your hands! :-)

JF 28 Jun 06

FYI, here’s a sample of the stuff we’ve added and improved in Basecamp since we launched in Feb 2004.

But we’ve said no to 100x more. And that’s what you have to figure out. What to say yes to and what to say no to. You don’t want to chase people by saying YES all the time. When new people walking in the door are smacked with too much stuff they’ll walk out.

JF 28 Jun 06

Fair enough, send me your list of unsatisfied customers and I’ll be happy to take them off your hands!

Ha!

I should reiterate — this is a very small group of our customers. Our retention rates are significantly higher than industry averages.

Dave 28 Jun 06

I just want to be able to make line breaks in To-Do items without using the HTML break tag :-P

Vishi 28 Jun 06

There is a solution to this problem.

Firefox solved it. Rails solved it. Wordpress solved it. Apache and a lot of others solved it.

THey not only solved the problem. byt made it their competitive advantage.

The long answer my friend lies here: Start a StartUp/Is “Less” really good for you?

Rogel 28 Jun 06

why not to develop additional service/application that will address the more complex/sophisticated customers?
When customers grow out of one service they can move/add additional services and you don’t have to loose your loyal and successful clients.

Des Traynor 28 Jun 06

Very interesting post Jason, delighted to see more signal around here.

Cheers

Anson 28 Jun 06

Certainly an economical plan: “make the simple stuff easy, and the complex stuff someone else’s problem”. Nothing at all wrong with this. Miles better than try to build the deathstar of project management tools. Great advice for anyone starting out building their own product.

It does ignore an intriguing area of software design which aims to “make the simple stuff easy, and the complex stuff possible”. Many pioneers have spent a lot of time on this. Kai Krausse, UI teams at Adobe, Alias|Wavefront, etc. etc. All with varying methods and degrees of success.

I think the real artisans of software design hold this idea as a tenet — engineering something usable for the masses yet appropriate for the gurus. Yes, it’s idealistic — it makes far better business sense to target demographics and limit feature scope to that cost/value sweet spot — but it’s an area I think the 37s could really add something to.

pwb 28 Jun 06

To some of the naysayers: what’s so great about complexity?

The same thing happens again and again: the incumbent continues to get more and more complex and the upstart comes along with a simpler solution and steals marketshare.

Jack Shedd 28 Jun 06

You’re conflating quality with features, and features with complexity.

A product with a very large number of features doesn’t need to be complex. It can be simple, flexible, logical to extend but basic to dive into.

My standard example in this argument is BBEdit vs. TextMate. By all accounts, TextMate has more, not less, features. It is vastly more customizable, with dozens of plugins loading, adding ‘features’, which anyone following this simplistic line of reasoning would say makes it more ‘complex’. But it doesn’t feel complex to it’s users. It feels simple, lightweight, and elegant.

It is also a good deal cheaper.

BBEdit is a monster of an application. Features scattered all over the place, in disorganized menus with arbitrary separations. It is ‘complicated’ software that feels complicated despite it’s relatively basic task (editing task).

The number of features you add is completely irrelevant to the quality of your software. It’s how you add them that matters. How do you satisfy the 80% of users who just need the basics, while enabling the 20% who require greater power a means to either find it or create it themselves.

The problem software runs into isn’t feature bloat. It’s careless design and fear of changing things on the users.

Jack Shedd 28 Jun 06

If you want an even greater example, look at the current feedback on the new “Ribbon” UI in Office 2007. Despite increasing features, Microsoft (by being willing to rethink their application’s structure and possibly confuse users) has improved it, and cemented Word (the classic feature-bloat argument example) as the leading word processor for another couple years. They’ve made Office more approachable.

Not what you add, how you add it. Staple it to your forehead and look in the mirror as often as possible.

robb monn 29 Jun 06

I guess so, guys. I agree with what you are saying but the fact is that no matter what the tool improvements can be made that keep or improve the simplicity. The vibe I get from 37s these days is arrogance: the answer to everything is no, we don’t just know better, but you know absolutely nothing, etc.

IMO (and who cares about that, right?) your company has actually become customer-hostile. My recent interactions with you guys over a simple bug triggered responses that were all about saying no, all about this and that being my issues not yours, etc., when it was a bug that I found. Almost a month later all I have to show for my commitment to your simple products working well for more than a year is frustration with your (IMO) taking your ‘philosophy’ too far. Your assumption is that no one that disagrees with anything that you do ‘gets it’ — and if this is not th case then you should work a bit to improve your image with your customers.

Sammy 29 Jun 06

“Because the company isn’t really a software company. It’s a sales organization run by business people who see growth as the only measure of success.”

Without addressing the larger points of this discussion (37signals’ design decisions, et cetera), or whether growth is or isn’t the only measure of success (it isn’t), I’m going to take issue with what I think is the sentiment here - that sales organizations are bad.

As a guy who produces software, it’s easy to look down on the sales guys. But the sales guys are the ones who keep you in caffienated beverages. For 37signals, people either subscribe to their services, or 37signals goes under. When Jason posts something like, “Our retention rates are significantly higher than industry averages,” you can be assured that he has more than an academic interest in the issue.

That said, growth isn’t the only measure of success.

JF 29 Jun 06

The vibe I get from 37s these days is arrogance: the answer to everything is no, we don’t just know better, but you know absolutely nothing, etc.

Why do you feel the need to speak in such extremes?

1. The answer to *everything* isn’t no. We say no more than as say yes, but most businesses do that. There are millions of opinions and ideas out there. Businesses have to say no more than they say yes.

2. “We just know better” — We’ve never said that nor do we believe that. We share what we think is right, but we’ve never said our way is the only way. In fact, we actively encourage people to find their own way. Hopefully our point of view is just one they consider when determining what they believe. We listen to everyone’s points of view to determine what we believe.

3. “you know absolutely nothing” — We’ve never said that nor do we believe that. Further comment isn’t necessary.

John Critz 29 Jun 06

The problem with the “it’s just a simple little feature, why can’t you add it” perspective is that you’re not thinking about the hundreds of other feature requests people have for the way they do business. Sure it’s probably a valid request and would save you some time, but only you and maybe a handful of others. So it’s usually not worth the development time or cluttering of the app. for a handful of people to benefit from it.

If a lot of people are asking for the same type of feature then start thinking about the simplest, most clutter free way to integrate it into your app., or start thinking about a new app if the feature doesn’t fit the paradigm of your current app.

If you need a product that exactly fits the way you do business, and grows with your business, then don’t look to subscription based web-apps; go buy Siebel instead.

JF 29 Jun 06

The problem with the “it’s just a simple little feature, why can’t you add it” perspective is that you’re not thinking about the hundreds of other feature requests people have for the way they do business.

Thank you John. This is the one thing that’s always difficult to explain to customers. Their specific request isn’t the only request we get. I can’t blame them for not thinking about this all the time, but *we* have to think about it all the time. We can have thousands of people asking for that “one simple thing.”

So yes, when we see larger patterns we begin to consider implementation of a solution to their problem. But one off “wouldn’t it be easy to add…” or “it’s just one link” or “Can’t you just make it…” aren’t realistically actionable requests — no matter how simple they seem on the surface.

Yay 29 Jun 06

Well if you put it that way, it sounds a little better. Your original statement made it sound like you just are not going to add the things many of us need/want. Hopefully no one that buys into your idea of “Getting Simple” wants you to add some obscure feature, but looking at the forums there seem to be a good deal of features many of us want added.

JF 29 Jun 06

Hopefully no one that buys into your idea of “Getting Simple” wants you to add some obscure feature, but looking at the forums there seem to be a good deal of features many of us want added.

This is a great example, actually. The Basecamp forums have about 2700 registered users. The vast majority of those aren’t active. There seem to be about 50 people that are heavily active and vocal. Those requests do not represent the majority of our customers. It’s inaccurate to assume that because some people in the forums want something that “many of us” want something.

We receive significantly more feedback by way of direct surveys and direct email than we do the forums. The forums are an important feedback mechanism, but they are third behind direct customer surveys and emails. And then there is of course our own opinions which we take into heavy consideration as well.

I’m just presenting this so people understand feedback comes in many different forms. Surveys, emails, forum posts, usage patters, customer support interactions, etc. We have to consider them all.

majimojo 29 Jun 06

The design challenge is the addition of complexity not the avoidance of it. Just like the challenge of building a great company that lasts is how to grow big but still have the agility of a small company.

One way complex systems evolve or are designed, according to Freud, is from the evolution of complex systems from simple systems. Freud had a theory of the mapping of the physical body to the mind and psyche. The human psyche he believed is a series of remappings of the same functional requirements. I believe that this Level of Detail design can let us simultaneously achieve simple and complex in the same system.

joshi 30 Jun 06

As an ex-paying customer I must say that this is the reason I had to leave Basecamp. In fact i’ve been reading this blog less and less the more I became disatisfied with your product.

For me it wasn’t the new complexity and requirements that my business had, they were there from the beginning. I had hoped that because the product was young, it would grow eventually to meet my companies needs but it hasn’t. And there was no feedback to customers on what features were planned further down the track so how was I to know either way?

I’ll give you two examples:

- I do work for clients across the globe but there is no way to set a local time for my company, and a different local time each individual client.

- I had hoped there would be a calendar for meeting times, sure I can use the milestones calendar for this but it is unprofessional for me to expect my clients to have to mix-up milestones with meeting times. So why in a collaboration product cannot I not adequately set-up a time to meet?

The philosophy of less is more should not be used as an excuse for the lack of strong progress in Basecamp. Look at the iPod it has retained it’s simple elegant design but has met the more complex needs of it’s users.

You have worked the art of marketing and visual communication to perfection. Listen to your customers more and I will be back in a second, but for now I’m going to sit on the sideline.

JF 30 Jun 06

I do work for clients across the globe but there is no way to set a local time for my company, and a different local time each individual client.

Yes there is. Click the people tab, edit a company, select their time zone. You can set different time zones for each company so everyone sees dates/times in their own time zone. There’s an FAQ on this and here’s the announcement of the feature when we released it based on customer requests.

Chad Sakonchick 30 Jun 06

I’m skeptic as to your reasoning. It sounds to me like Netflix’s throttling scheme. The small amount of customers that really utilize the full functionality of your product use more resources and make you less profit. The easiest way to get rid of the resource hogs are to simply ignore their requests. You can’t expect us to believe that there couldn’t be a plan that has more features than the rest of the plans.

On a side note… Am I crazy or did you used to say that developers should ignore customer feature requests? All of a sudden, 90% of new features are customer feature requests.

JF 30 Jun 06

Am I crazy or did you used to say that developers should ignore customer feature requests? All of a sudden, 90% of new features are customer feature requests.

We’ve never said ignore feature requests. We read and digest every single one of them. We say “say no by default.” So say no first, maybe later, and yes eventually.

90% of everything we add to our products originate as customer requests. But that’s what we *add* not what we hear. We hear a lot lot lot and just choose a few at a time that we think fit the product best.

majimojo 30 Jun 06

maybe you guys could give us an SDK or API that would let customers extend backpack and ur other products however which way we want. 37signals can still provide the bulk of the features that most of us users will use.

dunno how you’d go about implementing this platform. maybe UI and layout are defined with with XML extensions (firefox extension-like), methods are javascript, and both are user uploaded to the server? 37signals provides us with AJAX calls to serverside methods for complex things like database connections and PDF reading, etc?

one thing great about desktop apps like excel and maya is that you can use VBA and MEL/C++ respectively to implement any features that one could want. I’m sure you guys could make money doing consulting work to write custom extensions or if you just provide the framework, you’d create a whole little cottage industry for a lot of programmers!

JF 01 Jul 06

maybe you guys could give us an SDK or API that would let customers extend backpack and ur other products however which way we want.

Both Backpack and Basecamp have APIs.
Backpack API
Basecamp API

Mike Jacobsen 01 Jul 06

I think the API is the key. There will always be valid, useful feature requests that do not fit within the core vision of the product. The API allows others to build satellite applications that are tailored to the domain or use case in line with their core vision.

The effort for 37signals to try and address all of those adjacent spaces or more complex use cases is likely not worth it (as Jason’s comments seem to indicate). Sticking to the core vision will actually attract more developers to the API because they are less likely to have their hard work made obsolete by 37signals.

Simon Phipps 03 Jul 06

I think the API is the key.

The API is certainly key to creating a value system around one’s product but I’d also suggest that provision of full APIs and use of standard data formats in a way that allows those customers who have “grown out” of the software to move on is crucial.

I’ve argued elsewhere that a key element of adoption going forward is to ensure that customers know they are free to leave at any time. One of the things that has me using BackPack is that confidence.

Brad 07 Jul 06

Stick to your guns 37. Feels to me like you owe your success to your simple approach, leave the complex stuff to those who prefer build the bloated app’s. You’re simplicity has become the very reason I, and obviously many other’s have become such fans of your work.
So now, how about an email program? and I wonder is it possible to build an ecommerce solution for low level developer’s that is as easy to use as it claims??

Brad 07 Jul 06

Stick to your guns 37. Feels to me like you owe your success to your simple approach, leave the complex stuff to those who prefer build the bloated app’s. You’re simplicity has become the very reason I, and obviously many other’s have become such fans of your work.
So now, how about an email program? and I wonder is it possible to build an ecommerce solution for low level developer’s that is as easy to use as it claims??

Brad 07 Jul 06

Stick to your guns 37. Feels to me like you owe your success to your simple approach, leave the complex stuff to those who prefer build the bloated app’s. You’re simplicity has become the very reason I, and obviously many other’s have become such fans of your work.
So now, how about an email program? and I wonder is it possible to build an ecommerce solution for low level developer’s that is as easy to use as it claims??

Brad 07 Jul 06

Can someone delete the above 2, the page got stuck for 1/2 hr.

Arlen 09 Oct 06

Constraints breed creativity. Simplicity (in terms of number and depth of features) breeds efficiency. I buy into this component of 37s philosophy whole heartedly.

Don’t have a feature to set up meeting times? Use notes to communicate about it. That’s what they’re for.

Want to beautify your writeboard? Too bad. Having less control of visuals forces focus on content, which is what writeboards are all about.

Every “no” from 37s has potential to save thousands of hours of time. Constraints are your friend. BC and BP provide just enough to get by, no more. That’s how I like it.

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