Bret asks:

I often see people on forums telling complainers to shut up with the “vote with your wallet” line. How does 37signals feel on the matter? Is it better to have a vocal customer who’s willing to stick with the product despite a perceived shortcoming or would you prefer that such a customer move on?

The first thing I’d say is this: It’s tough to be 100% happy with anything. Sacrifices rule the day — each person needs to figure out where their limits are. So if it’s one thing that’s really bothering someone, maybe they can find a way to adapt (or we can find a way to improve). But if it’s one thing after another, maybe that product just isn’t a good fit for that customer.

The second thing I’d say is this: You can learn a lot from a vocal customer. Even customers who continually bash your company or your product have value. So the goal shouldn’t be silencing them, it should be listening to them. You don’t have to do anything they say, but being aware of what they’re saying can give you insight into a perspective that you may otherwise not have had.

We hope you’re happy here

What’s most important to us is that people who use our products are happy using our products. If someone is unhappy with our products, we’d love to hear why. Maybe we can make them happy. But maybe we can’t — that’s certainly possible too.

So if we don’t think we’ll be able to make them happy, and they’ve found another product that makes them happier, we encourage them to use the other product. Sometimes we’ll even recommend an alternative if we can.

Don’t fight a losing battle

At a certain point there’s no sense in trying to make someone happy who you can’t keep happy, and there’s no sense in someone suffering endlessly when they constantly run into things that don’t work for them. If it doesn’t fit, it doesn’t fit. Luckily there are a lot of choices, different approaches, and alternatives out there. Choice is on the side of the consumer.

Be honest up front

This sometimes comes up in pre-sales emails. People will ask us why our product is better than this or that product. We may riff on the fundamental advantage of simple, focused tools like ours, but then we’ll say something like: “There’s really no way for us to tell you what’s best for you. We encourage you to try all the products you’re considering. That’s the only way you’ll ever know for sure which product feels right. We hope it’s our product, but if it’s not we understand.”

Some salespeople may say that’s a terrible strategy, but we prefer to give the most realistic answer, not the “obviously we’re the best no matter what” answer. Because in the end, what feels right is what works best. Comparing products by comparing features isn’t really an effective way of making a decision. You have to compare the experience and you can only compare the experience by trying the products.

So yes and no

So, yes, I do encourage people to vote with their wallet, but at the same time I don’t encourage companies to chase all wallets either. Every wallet isn’t going to be a good fit in your pocket.

Some recent posts at the 37signals Product Blog:

Basecamp
[Case Study] Marketing firm BKWLD loves Basecamp because it’s “intuitive, easy to use, and easy on the eyes”
“Private messages and to-do lists were a godsend for one client. This was a particularly challenging project for an extremely difficult client. Private messaging in Basecamp gives us control of our client’s perception of their project, while still allowing us to be explicit with its nitty-gritty parts all in one convenient place. Sometimes the work gets a little ugly, but keeping a professional facade is extremely important to some clients. Basecamp accommodates this nicely.”

BKWLD’s Dashboard.

How Blutique uses Litmus and Basecamp to deliver page and test results to clients
Silas Peterson of Blutique, an interactive consultancy located in New Orleans, Louisiana, writes in to tell us about how his team uses LitmusApp inside of Basecamp to deliver page and email platform test results to their clients.

Litmus and Basecamp.

Backpack
“Backpack has changed my life”
“I’m able to use this extremely affordable system to manage small projects, allow people to collaborate, image files, create lists, assign tasks, edit and share calendars and more…I think this is an excellent solution for small companies and start ups.”

Highrise
How do I build a bulk mailing list in Highrise?
You can do this by giving each contact you want on the mailing list the same tag and then exporting the list…Click the “Tags” tab and click that specific tag to bring up all contacts on your list. Then click the “Export” link in the sidebar. Choose the format you want and save the list. You can then import this list into the application that you use to send group emails, create mailing labels, etc.

Multiple products
Less Accounting, more Basecamp and Highrise
“Accounting sucks. Less Everything makes it suck less. Our flagship product, LessAccounting.com was built with ease-of-use at the core of the accounting software, which caters to small businesses and freelancers. The app just got even better by integrating with Basecamp and Highrise to make importing contacts ridiculously simple.”

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Design Jobs

Obama for America is looking for a Web Designer/Developer in Chicago, IL.

Apple Inc. is looking for a UI Engineer in Cupertino, CA.

Best Buy Co., Inc. is looking for a Front End Web Developer in Richfield, MN.

Crain Communications is looking for an Interactive Designer in New York, NY.

Zillow.com is looking for a UX Designer in Seattle, WA.

TripAdvisor is looking for Web Developer in Boston, MA.

Flirtomatic is looking for a Interaction designer/architect in Soho, London.

HUGE is looking for a Art Director in Brooklyn, NY.

Business.com is looking for an Web Designer in Santa Monica, CA.

Check out all the Design Jobs currently available on the Job Board.

Programming/Tech Jobs

Brandissimo is looking for a Senior Web Developer / Internet Jedi in Los Angeles.

Teehan+Lax is looking for a Senior Front-End Developer in Toronto, Canada.

Janus Health, Inc. is looking for a Web Developer Extraordinaire in San Diego, CA.

Serious Business is looking for a Rails Engineer located in San Francisco, CA.

OHSU is looking for a Web Applications Developer in Portland, Oregon.

Leapfrog Online is looking for a Ruby/Rails Software Engineer in Evanston, IL.

Rockstar Games is looking for a Web Developer in New York.

Auditude is looking for a Front-end Web Engineer in Palo Alto, CA.

Polar News Company is looking for a Front-end Developer in Soho, New York City.

Check out all the Programming Jobs currently available on the Job Board.

More jobs!

The Job Board is flush with great programmer and designer jobs all over the country (and the world). The Gig Board is the place to find contract jobs.

Compass Bank is currently running a special promotion that gives you 3 months free of Backpack Plus (normally $49/month) when you open a new Compass Business checking account.

If you’re interested in offering Backpack (or Basecamp or Highrise) to your customers or members as a value-add, please email me direct at jason@37signals dot com.

The pizza at Di Fara Pizza on Avenue J in Midwood, Brooklyn is amazing (among the best in NYC). Owner Domenico DeMarco has run the place for over 40 years and makes each pie by hand.

The place is a restaurant consultant’s nightmare though: The wait for food is over an hour. Sometimes two. You can’t call up and order a pie either. You have to do it in person. Ask how long your order will take and you get a shrug. There’s a permanent line all the way out the door yet the only person allowed to touch the pizzas is DeMarco. He grows his own spices on the windowsill and cuts the basil right onto the pies with a pair of shears. Prices are double what other neighborhood pizzerias charge: A regular pie costs $20. A slice costs $5 (but you can only get one of those when DeMarco feels like it). Also, the place is a mess. No one wipes the tables after meals. Stacks of used bottles line the walls. Smoke from the ovens clogs the whole room.

I’m sure if you asked restaurant business experts, they’d say he should take phone orders and reservations. He should expand to a bigger location and hire others to work with him in the kitchen. He should clean the place up and buy some nicer tables. But it’s pretty clear that DeMarco doesn’t give a shit.

The freedom of small businesses
DeMarco doesn’t care about experts, franchising, or expansion because he doesn’t have to. That’s what you can do when you run your own small business. You can stay small. You can create your own thing and keep it the way you want it. You can take pride in what you’re creating and oversee everything that comes out of your oven. If people don’t like the wait, they can go somewhere else. If they don’t want to pay extra for the ingredients you grow yourself or import from Italy, that’s fine. You can be a perfectionist and take as long as you want. And the customers that care about what you care about will flock to you.

The reward: You get to satisfy customers and make money. But beyond that, you get to love what you do. Your work doesn’t feel like a job. It feels like art. You get to feel passion. Instead of counting the days to retirement, you keep working. Because you’re already doing what you love.

“There’s no money in the world they could pay me for it”
In “Charred Bubbles, and Other Secrets of the Slice,” DeMarco explains:

Nobody taught me to make the pizza. You gotta pick it up for yourself. All of these 40 years, I keep experimenting. My pizza is good, because I use fresh tomatoes. They come from Italy, from Salerno. Then I started to get mozzarella from Italy, from my hometown in the province of Caserta. It’s $8 a pound, and this parmesan, it’s $12. It comes twice a week. This might have been made two days ago, or three days ago.

I do this as an art. I don’t look to make big money. If somebody comes over here and offers me a price for the store, there’s no price. There’s no money in the world they could pay me for it. I’m very proud of what I do.

Continued…

Fellow Chicagoan, great programmer/journalist, creator of the Django framework, talented guitarist, and genuinely nice guy Adrian Holovaty and his Everyblock hyperlocal news and information site grace the cover of this Sunday’s Chicago Tribune Magazine. Adrian, his site, and his crew deserve all the ink they can get.

Venture capitalists are glorified gamblers in the Ace-from-Casino sense of the word. They try their best to collect intel on the players, but ultimately still just place bets. Bets that usually fail more often than they succeed. It’s the 1-in-10 blowout payoff that makes sure the piano keeps playing for them while the tune goes mum for the rest of their bets.

Those are potentially good-enough odds for a VC to make a decent return for their investors. Lots of VC’s can’t even pass that bar, though, and end up net-negative for their backers. But let’s just take the guys who do make it. What’s their seal of approval worth?

According to Adam from Heroku, it’s much more valuable to get the peg from these gamblers than actually having sales in the shop:

When you’re doing your own thing, you have very little feedback on whether your path makes sense. You’ve got users/customers, sure. But for any random thing you might build, you’ll always be able to find some weirdos that want it, and maybe are even willing to pay for it. Whether those people represent the vanguard of a sustainable customer base, or whether they are a niche too tiny to build a real business on, is impossible to tell early on.

But convincing investors of the viability of your idea – enough to place a monetary wager on it – provides early confirmation that you’re on a viable path. It may even provide some course-corrective feedback. This is why VC-backed companies tend to get more respect than non, all other things being equal. A firm whose sole purpose is predicting technology trends believes that there is a reasonable chance that this company’s product will be the next big thing.

It’s funny, I have the exact opposite take from the same indicators.

Real customers who use their own money to pay for your products seem like a much better, much more real confirmation that you’re doing something right than getting pegged by a VC using other people’s money to fish for 1-in-10 chances of a monster trout.

To me, convincing a VC to give you money only confirms that they think your outfit is capable of having a long shot of making a big sale down the line. And that they can dilute you successfully enough that they’ll get the lion’s share of the spoils. As a confirmation of a real business? Meh.

Separate users from customers to determine success
I think the confusion comes from how callously users and customers are conflated. I absolutely agree that if you’re just giving away your shit for free, then interest is only an indirect indicator for possible success at best. Who knows if these freeloaders can actually be made to turn a profit? Better take the money upfront and run for the exit before you have to find out!

But if you stop thinking so much about users (or eyeballs if we’re talking early 2000s) and start focusing on customers, the game opens up. Real customers not only confirm directly that you have a compelling product (rather than the by-proxy way of a VC), they also help fund your operation from the get-go.

You don’t need outside bets to launch a web business
Most web startups don’t have high costs outside of labor that can’t be linked at least linearly (and preferably better than that!) to the growth in customers. If you need lots of servers, it’s presumably because lots of people like your product and if you’re treating your users as customers, that means you’ll be having plenty of dough to bake a profitable cake.

All that being said, it’s certainly possible that being on the receiving end of a VC bet can lead you to the jackpot. The wheels in Vegas wouldn’t keep turning if some people didn’t see a big bucks ringing of cha-ching sometimes. So if the idea of trusting VCs over customers appeals to you, just roll your dice and hope you don’t roll seven!

An electric knife:

A juicer:

An iron:

More disassembled appliances in this Flickr set.

Farhad Manjoo (who wrote a cover story on 37signals for Salon.com a few years back) is now writing for Slate. This time he wonders about the Google Black Hole.

Farhad plays “Where Are They Now?” with some of Google’s recent higher-profile tech acquisitions. He focuses on mojo-heavy companies and products like Jaiku, Jotspot (Sites), Dodgeball, Measure Map, and Grand Central. Some of these died, some of these slowed down, some of them were still not open for new customers a year after the acquisition. Some people are wondering if Feedburner (Google), Upcoming (Yahoo), and Delicious (Yahoo) might belong on this list.

The astute Dare Obasanjo wrote about this phenomenon in detail a few days ago. His Application Rewrites after Acquisitions: How Large Software Companies Destroy Startup Value article is well worth a read.

Of course there have been success stories. Innovation at big companies often comes from the small companies and teams they swallow whole.

But with the odds of a big-co buyout nearing lottery proportions, a good chance of neglect awaiting your product on the other side, and a “I can’t wait until my employment contract is up,” feeling lingering your every work day, I hope entrepreneurs think twice about building to flip.

Related: David’s The secret to making money online talk at Y Combinator’s Startup School 2008.

CD Baby founder Derek Sivers interviews Tim Ferriss, author of The 4-Hour Workweek. Fascinating stuff. Below are some of the most interesting Ferriss bits from the interview.

Why you shouldn’t view changes as permanent:

So what would happen if you eliminated this? Let’s just say 48 hours, seven days, one month? What would happen if you did the opposite? Those are two very, very useful questions. Most people avoid certain actions because they view changes as permanent. If you make a change, can you go back to doing it like you did before? You can always reclaim your current state in most cases. If I quit my job in industry x to test my artistic abilities in a different industry, worst case scenario, can I go back to my previous industry? Yes. Recognize that you can test-drive and micro-test things over brief periods of time. You can usually reclaim the workaholism that you might currently experience if you so decide to go back to it.

He tested titles for his book via Google Adwords campaigns:

Then I ran a Google Adwords campaign, where your ad appears based on keywords that people were searching for. I ran a dozen different ads with a dozen different potential titles as the advertising headline, with the potential subtitles as the ad text. The click-through page was nothing, but I wasn’t concerned with the conversion or cost per acquisition. I was only concerned with the click through rate – which of those dozen headlines was most popular. So for less than $150 in one week using keywords as a fixed variable, I was able to identify “The 4-Hour Workweek, Escape 9-to-5, Live Anywhere and Join the New Rich” as the most successful title by far.

On scratching your own itch:

If you have something that you would like to make and you just don’t know how to test it, make sure you’re scratching your own itch. Like Twitter: Evan Williams and Jack Dorsey created it in two weeks as a way to scratch their own itch. He said, “At least that way you know that one person is interested in having it.” It’s amazing how many otherwise smart, well-funded companies will use awful statistically-invalid focus groups, then say, “Well, no one in this room likes the idea, but our focus groups tell us that we should make it,” so of course the product comes out and it fails.

You can’t fix an overwhelmed feeling with more work:

That’s a good point – recognizing you can’t fix an overwhelmed feeling with more work. Overwhelmed is not due to lack of time – it’s due to lack of priorities, right? Another flaw in most time management systems is they focus on filling your time – every minute of every day should be filled with a work vision of some kind. Or they don’t instruct you on how to minimize the work. Especially if you tend to wear overwork ethic as some kind of badge of honor, which I know many artists do. Laziness is not less action. Laziness can mean blurred priorities and indiscriminate action. You can be very busy running around with a cell phone to your head 24 hours a day and still be very lazy because you’re not taking the time to prioritize.

Continued…