Version 1.2 of Draft, 37signals’ basic sketch app for the iPad (with email and Campfire sharing built in), is now available in the App store. It includes bug fixes, faster response times, and smoother drawing.

More about the backstory of Draft.

Also, in Inc. magazine a few weeks back, Jason explained why we decided to charge $9.99 for Draft (“We have no interest in participating in a race to the bottom. Ninety-nine cents is not for us.”).

This is part of our “Bootstrapped, Profitable, & Proud” series which profiles companies that have $1MM+ in revenues, didn’t take VC, and are profitable. Note: Seth Kravitz of InsuranceAgents.com will respond today (12/7) in the comments section to reader questions.

The liability of growth

“In 2007 we did $750,000 in revenue with five employees. In 2008 we did $12 million with twelve people,” says Seth Kravitz of InsuranceAgents.com, a site that helps consumers save money on their insurance.

But it was far from a dream, according to Kravitz. “Every time I mention explosive growth as a huge potential liability there are lots of confused looks,” he says. “How could the revenue exploding possibly be a bad thing? All of a sudden our little five person startup went from $750,000 in revenue to $12 million in 11 months. We had to hire like crazy, expand our development platform like crazy, expand our customer service, payment processing, banking, everything imaginable.

“We had never really had HR issues and now all of a sudden we had to deal with employee troubles, benefits programs, and revamping of hiring practices. Our phone systems couldn’t handle the volume of calls we were getting. Our servers couldn’t handle going from processing 500 leads a day to 11,000. Suddenly, it felt as if the company had grown a life of it’s own and we were simply along for the ride. Every day was spent playing catch-up that year and it probably shaved off 10 years of our lives with the stress. Like so many before us, it could have destroyed the company, but we luckily got through it.”

“Suddenly, it felt as if the company had grown a life of it’s own and we were simply along for the ride. Every day was spent playing catch-up.”

The company decided to actively hit the brakes on growth in order to examine all aspects of the business — from the way they hired, to training, to customer service, to the call center. Kravitz says, “We slowed our sales down to rebuild our entire platform, increase stability, and code some new features designed to increase revenue.” Now that process is done, the focus is back on growth again.

The partners meet

What drove Kravitz, a college student when the company was founded, to the unsexy world of insurance? “It’s certainly not the flashiest profession in the world, but it is a very useful one,” according to Kravitz. “Our concept was to build a service where anyone in the US can hop on our site and start comparing rates from up to five local insurance agents.” The site then generates revenue by helping agents find new customers.

Kravitz and Lev Barinskiy, his business partner, originally met at a party on the Ohio State campus their freshman year. Kravitz says, “To be honest, we really didn’t like each other as far as first impressions go. We were both straight out of high school. Really just a couple of kids at that point and we acted like it.”

About two years later, they met again through a mutual friend. “Once we sat down and really got to know each other, everything changed,” says Kravitz. By this point, he had started a small web design company and Barinskiy had started a successful insurance agency. Barinskiy mentioned that he wanted to start building insurance websites and needed a partner to get it going.

InsuranceAgents.com co-founders Seth Kravitz (left) and Lev Barinskiy. (Photo: Jonathan Robert Willis for Inc.)

A shoestring operation

Within a week, they were working together out of Barinskiy’s parents’ basement on a couple of plastic folding tables from Home Depot. “We ran an ethernet cable out of his bedroom window down the outside of the house into the basement to get online down there,” explains Kravitz. “He owned a food cart business serving Ohio State football games, so in his basement he had stacks of candy and chips. That means lunch most days consisted of standing up, walking to the corner, grabbing a Kit-Kat and walking back to the desk.”

“We ran an ethernet cable out of the bedroom window down the outside of the house into the basement to get online.”

Continued…

This holiday season 37signals is partnering with our new neighbors in the West Loop of Chicago to gift the children of William Brown Elementary School with new clothes and toys.

William Brown Elementary currently reports 96% of its students receiving public aid, and we’ve committed along with Converse, Hurley, Soul City Church, the Kyle Korver Foundation and many other local companies to create a Christmas store. Families can purchase new, donated items for Christmas gifts at crazy low prices, and all proceeds will go directly back into Brown Elementary.

For our part, 37signals will be collecting new toys (not in wrapping paper) at our Chicago Office until December 17.

You can drop off your toys and good cheer to our office between 10am and 5pm, Monday-Friday. [MAP]

We’re excited to join with our neighbors for this great cause, and hope all local friends of 37signals will join in too!

The Christmas Store event takes place the December 18, 9-12pm at Soul City Church. All profits from the store are being donated back into Brown Elementary.

We’re looking for another excellent web-app UI designer to join our team.

Besides having great visual taste and talent, you must code well-structured HTML/CSS. Basic Javascript or Rails skills are a plus, but not required. Great writing skills are required.

UI designers at 37signals are always working on different things. You may be working on polishing up an existing feature in Basecamp or designing the UI for a brand new feature in Highrise. You may be revamping Backpack or fundamentally rethinking some UI in Campfire. Or maybe you’re involved in designing a brand new product (we’d like to explore two in 2011). You may be asked to come up with something no one has ever seen before.

At 37signals you’ll be working on products that people rely on to get their job done. Your work will impact millions of interactions. You’ll be working with some of the best designers, programmers, dev ops folks, and customer support people in the industry. Our team is top notch and we want you to make it even better.

Our projects are always focused on solving real problems. When the problem goes away we know the design is right. Your job, as a designer at 37signals, is to make our customers’ problems go away.

At 37signals, designers lead the teams. Each development team is made of up three people – two programmers and one designer. The designer also manages the project. In addition to designing the screens/elements, you’ll keep the team focused and make calls about what’s important. You’ll be the go-to person on the project.

We’re not looking for a certain design style, we’re looking for a certain design approach. Simplicity isn’t enough – clarity is where it’s at. You think about how people interpret the objects on the screen. What they think about, what moves them, what frustrates them, what makes them happy. You know that the right design decision can make all the difference.

You’re excited to discover a better solution, even well into a project. You don’t mind throwing something out in favor of a better idea or implementation. Projects at 37signals start with real code. Feedback from an evolving prototype guides the team. While we’re very pragmatic about code, it is important that your design/code is easy to change in response to feedback.

Lastly, you understand that copywriting is design. The words matter as much as the pixels. Great visuals with weak words are poor designs. You should care about how things are phrased as much as you care about how they look.

CHICAGO PREFERRED: Since two of our dedicated UI designers are outside of Chicago, we’d prefer if you were in Chicago to balance things out. If you think you’re perfect for the job, and not in Chicago, we still want to hear from you. We want the best we can find. If you’re the right fit, we’re open to relocation as well. We have an open desk for you in our new office.

How to apply

Send relevant work samples, and anything else that will make you stand out, to [email protected]. Include [UI DESIGN] in the subject of the email.

It doesn’t matter where you went to school, or if you even graduated. It doesn’t matter if this is your first job or your fifth. Doing great work and being driven to improve yourself and everything you touch is what matters.

If we think you may be a good fit we’ll be back in touch with step two of the application process.

Application deadline

We’ll be accepting applications for this position until December 20, 2010.

We look forward to receiving yours.

Verifiable (shut down August 1, 2010)
Stuart Roseman shut down Verifiable, a crowdsourced charting and data analysis site, to start SaneBox, a product that automatically identifies important email and separates them in a user’s inbox. Below, he explains how he knew when it was time to pull the plug on Verifiable.

“We couldn’t charge for it. It was pretty clear. I’ve done this for a long time. I said, ‘This is a bad idea. I need a new idea.’

“The Verifiable problem still exists. It hasn’t been solved. There’s still chart junk. It’s got to be easier. But Verifiable was something I thought the world needed. SaneBox was something the world was asking for.

“My new mantra is: ‘I will make a product that people want to pay for and that they will be happy to pay for.’ I wake up in the morning and I say that. And I go to sleep at night and say that. It really changes everything.”

Related: “Out with the old business, in with the new”

Wesabe (shut down June 30, 2010)
Wesabe launched as a site to help people manage their personal finances. While competitor Mint was acquired by Intuit, Wesabe eventually shut down. In “Why Wesabe Lost to Mint,” Marc Hedlund dissects what happened.

“Mint focused on making the user do almost no work at all, by automatically editing and categorizing their data, reducing the number of fields in their signup form, and giving them immediate gratification as soon as they possibly could; we completely sucked at all of that…I was focused on trying to make the usability of editing data as easy and functional as it could be; Mint was focused on making it so you never had to do that at all. Their approach completely kicked our approach’s ass.

“You’ll hear a lot about why company A won and company B lost in any market, and in my experience, a lot of the theories thrown about — even or especially by the participants — are utter crap. A domain name doesn’t win you a market; launching second or fifth or tenth doesn’t lose you a market. You can’t blame your competitors or your board or the lack of or excess of investment. Focus on what really matters: making users happy with your product as quickly as you can, and helping them as much as you can after that. If you do those better than anyone else out there you’ll win.”

Related: “Wesabe is discontinuing its Accounts tab as of July 31st”

Storytlr (shut down February 24, 2009)
Storytlr let members create their own lifestreaming service (i.e. connecting Twitter, Flickr, Last.fm, and other accounts) at their own URL. Founder Laurent Eschenauer on what happened:

“Storytlr started as a personal project to power my own site. People liked it, so we decided to build a nice UI and start hosting it for others. We were developing and operating the service next to our day job and families. We were quickly successfull, reaching beyond 10,000 users quickly and this meant a lot of strains on our lives (maintenance, support, etc.) and budget (~500$ monthly hosting bill) without any revenues.

“At that point, we started researching potential revenue models and investors, but quickly realized that the service was not well suited for a strong revenue stream. It was a tough choice, but, for the security of our families, we decided to pull the plug.”

Related: Laurent Eschenauer pitches Storytlr to Google’s Sergey Brin

TwitApps (shut down September 13, 2009)
Stuart Dallas created TwitApps as a technical exercise for himself. But after some early blog coverage, it attracted 4000 active users (and that number was growing). Despite that base, he couldn’t turn it into a product that was worth the effort.

“I considered the whole thing to be a toy project for a long time and it took me a while to realize that people were starting to rely on the service.

“Once you’ve established a free service and that service has other free competition, it’s very difficult to monetize it. It’s also very hard to change people’s impression of what something is once they’ve decided for themselves.”

“It became difficult to juggle the time demands of supporting TwitApps with the requirements of a full time job, several contracts and the need for downtime. In the end something had to go and it was clearly going to be the bit that wasn’t earning any money.”

Related: “TwitApps shutting down”

Continued…