Category Archives: Startups

Zeta Centauri Windows App Revenue Postmortem

Now that I’m no longer selling the Zeta Centauri apps, I decided to add up sales of Windows desktop apps over the years and see how much it was.

2010: $261.25
2011: $160.44
2012: $69.24
2013: $0*
2014: $109.26
2015: $50.08
2016: $95.58
2017: $36.42

Total: $781.27

Overall I’d estimate that I’ve spent about 3500 hours developing apps for Zeta Centauri. This works out to about 22 cents per hour.

This does leave out 2008 and 2009 that I don’t have records for, but I think it was about $35 total each year.

This also leaves out my brief experimentation with installer-based advertising (that spamware/crapware stuff that tries to trick you into installing a useless toolbar). That made about $50, and I feel bad about even trying it.

This also leaves out selling Ubuntu versions of some of these apps, which was about $35 total.

In any case, it’s less than $1000 total.

During the 6 months or so I was building webOS apps (before the platform was murdered), I brought in about $700. That was a much better return on my time. I managed to port one of those apps to Android and made about $7 with it. I really hated working on Android and using the Eclipse tools, so after that one I was done. Never tried iOS (always had a mild dislike of Apple).

It was an interesting experiment, and I tried nearly everything I could think of to make it work. If I’m going to make it in this world, it won’t be with desktop audio software.

The only thing that I didn’t try was adding VST support, and that would have made a significant difference. I’m guessing 4x sales. I mean, I did try adding VST support, but didn’t succeed in implementing it. I could never get it quite right.

* Technically sales happened this year, but not enough to hit the $25 payout threshold, so they’re counted in 2014.

Interesting But Not A Business: The Story of the WbSrch Search Engine

I write this after having just shut down my almost-startup, the WbSrch search engine.

I started working on WbSrch for “fun” in the fall of 2013. AltaVista, my favorite search engine from “back in the day” had shut down that summer. Nostalgia combined with annoyance at how bad/annoying/intrusive/evil Google had become convinced me to try building my own version of AltaVista.

Well, a month of hacking later I had the core of something rudimentary but sort-of-functional. It was pretty terrible, but proved that I could get something built. I crawled a total of about 200,000 pages and had a bare skeleton of a search engine. I started by calling it the “anti-social search engine” because at the time, searching Google for almost anything would return so much social media drivel, clickbait garbage, and otherwise low-value spam-like content.

Getting to the first prototype was easier than I expected, so I continued to work on it, improving the crawler and search algorithms and growing the index. At around 2 million pages it outgrew the Linode VPS it was on and I set up hosting at a local colocation center using a $400 server I picked up on eBay (great deal – dual quad-core Xeons and 72GB of RAM – plenty to grow with).

Things progressed and I ended up announcing it to the public around the end of May 2015. It only had 5 million pages and the indexing algorithms were still pretty terrible, but it started getting some Human traffic.

And the bots discovered it. Every link analyzer SEO app in the world decided that WbSrch was a juicy crawl target. I considered blocking them since the SEO industry is complete garbage, but they were a decent source of Human traffic, and most of the traffic came from webmasters who would check to see whether their sites were indexed and run a few searches.

As it grew, maintenance became more time-consuming. I wanted to keep it from being too porn-heavy, from being full of Chinese and Russian sites, and pages categorized by language so the German-language front-end would only return pages in German.

After a year and a half of running the site as a hobby project, I decided to put it away because the mission had been accomplished – an index of 10 million pages, and it worked about as well as any other mid-1990’s search engine. For a few months the front page just pointed to Yandex.com (a Russian search engine – the third-best search engine after Google and Bing).

Well, one unanswered question kept nagging at me: “What if I could turn this into a real business?”

So I turned it back on, and started working on it pretty hard. I read a bunch of textbooks on information retrieval, text processing, statistical language processing, and a bunch of other search-related topics that I knew nothing about when I started the project.

Almost immediately the drives in the server failed.

So I replaced them and rebuilt the server. Didn’t lose much other than a week or two of crawl data because I had a backup, and source control. A few months later the drive controller failed, but there was no data loss – just a day of downtime and a lot of swearing.

As it grew and improved, I also started running some advertising, trying to build the audience and increase traffic. Visits were pretty cheap, but not very sticky. The bar is extremely high for getting someone to switch to a new search engine.

Still, there was some traffic, on the order of a consistent 5-digit number of pageviews per month. So I tried monetizing using a few different ad networks (around ten). The best one was able to earn about $3 per month. When you can’t use ad networks that don’t let you link to porn, gambling, or torrent sites but don’t want to advertise porn, gambling, or torrents, your income is low. Abysmal. $.05 CPM on the high end.

With the math for getting new visitors figured out (3-7 cents per click depending on the channel), and the math for monetizing those visitors figured out (about 5 cents for every 500 visitors), it was clear that it would cost $5 to earn $0.01. If those users were really sticky and would return over and over again, then maybe it would be worth the price. But they weren’t.

I also ran a crowdfunding campaign to gauge interest/demand. I raised a little money for hardware upgrades, but more importantly I learned a little more about how much people just don’t care about having another search option. I did manage to get one donation from someone I didn’t already know, but only one.

At this point I had about 47 million pages indexed and the search engine had grown to 3 servers. It had crawled only a tiny fraction of the internet, but it was still possible to find what you were looking for much of the time. It’s surprising how well you can do with a small index if you focus mainly on the most popular sites.

But to take things to the next level of quality I would need to build a system able to handle at least a billion pages.

That’s where things get expensive. I had only spent about $8,000 on WbSrch so far. Did I want to spend another $50,000 to get to that next level where users might be a bit stickier and ad revenue might be better (it tends to be lower when you’re low-volume — when you have enough traffic that algorithms can optimize, it gets better). Maybe it would only cost $2 to earn $0.01 and those users would return often enough that I could earn another $0.01.

And that’s where I decided to shut everything down. Math doesn’t lie.

Call it failure to validate. There is no search engine business to be had for me. Maybe someone else could do it. Like DuckDuckGo. Interestingly, they didn’t start with their own crawl. And they’ve partnered with Microsoft for advertising. So they’re essentially a privacy-focused variant of Bing with a different UI. That’s good for them, but the interesting part is developing your own proprietary technology, your own crawler and algorithms. Otherwise, one day Microsoft could decide that having an API is inconvenient and shut down your entire business.

At some point Apple will decide that having a search engine is important and build or buy one. Maybe they’re already building one if the rumors are to be believed.

Anyhow, it’s a little bit sad that it didn’t work, and a little bit sad that I spent all that time on it, but I did get smarter. And not just code. I learned a lot more about marketing and advertising in the process.

So now it’s on to the next thing.

Quora Answer: My son got an offer from a 1-year-old startup by some very senior folks from Google. The pay is good and product idea is good, but it’s a startup. He asked for our advice on this. What are some suggestions from people from relevant fields?

I originally wrote this as an answer to a question on Quora.

I joined a startup founded by ex-Google people in 2010 as the third engineer. I worked there for 2 years, had a great time, learned a ton, got my first patent out of the process, and the experience is one of the best I’ve ever had. I wouldn’t trade it for anything.

The only reason I didn’t stay is because California wasn’t for me, but the startup is still going, and it feels like my shares are a pocket full of scratch-off lottery tickets. They could end up failing, but they won’t.

1-year-old is probably the best time to join a startup with solid backing, and even though being ex-Google doesn’t necessarily make you smarter or more likely to succeed than anyone else, it sure makes it easier to get funded.

In the worst scenario, they’ll run out of money and he’ll have to spend three or four weeks looking for a job. If he has any skill and/or motivation, he’ll be so much smarter and better for the experience that it’ll be really hard to NOT get hired for something new.

That’s the big fear fallacy with startups — that they’ll fail and you won’t be able to get a job. But all of the things you go through in making a serious go of building a startup make you so much better at what you do that there’s nothing to fear. I like to think of the experience factor as being 2 to 1. If you spend 2 years in a startup it’s a similar learning experience to spending 4 years at a stable company.

The fatigue factor is also similar. I feel like software can be a very mentally taxing and draining endeavor, so a 6-month sabbatical every 5 years is almost a must unless you’re in a perfect environment. Being in a startup shortens that “wear out” time, so you might need to take a break every 2-3 years in order to remain healthy and sane.

The most important thing to do if you’re considering joining a startup is to make sure the people running it are somewhat-well-adjusted grownups, or at least likely to become so in the near future.

Quora Answer: Before joining as a CTO and only coder of an early stage startup, what knowledge should I have?

I originally wrote this as an answer to a question on Quora.

Full question:

“And, which kind of questions should I make to the initial founders?
I am not only talking about technical skills, all kind of knowledge matters.”

Knowledge

You should already know most of what you need to know to build version 1.0 of the product. You’ll learn the rest as you go.

You should also know how to deploy it, secure it, and manage it.

You should know how to document what you’re doing, at least enough that a smart person could pick up and maintain it later.

You should know enough to plan for disaster recovery. That’s not too hard at the early stage — just don’t keep everything on one computer in one building.

You should also know how to evaluate, onboard, and delegate tasks and projects to future hires.

You should be VERY good at estimating how long it will take to develop a new feature.

You should be comfortable with networking, presenting at user groups, and going out into the world to get to know other CTOs, developers, and people in your industry. If things work out you’ll be hiring these people someday.

You should be good at researching the competition and finding out what strategies they are using.

You should be good at the technical aspects of sales/marketing. A/B testing, mailing list management, promotional codes, etc. None of this is hard, but you should expect to do things that make it easier for the non-technical people to get the product tested and sold.

Questions to Ask

You should dig VERY deeply on what validation they’ve done and who they already have on the hook as potential users, investors, and beta testers.

You should find out whether they have the skills to do their job. Their main jobs are:

– Getting people to care about the product enough to buy. (selling).

– Getting people to the top of the sales funnel in the first place (marketing).

– Getting product-market fit (customer validation).

– Getting the resources the company needs (fundraising).

You need to find out whether they’ve done the work to validate their idea and whether they have people interested in at least trying (or better yet, buying) once it’s built.

You also need to find out how much of version 1.0 they’ve already designed. Find out what feature set they’ve designed, and be sure to ask how much they’ve validated each feature or aspect of the design.

You also need to find out what their expectations are and how rewards and equity are to be split up — what will your reward be for your efforts? What’s the existing equity split?

Quora Answer: When people at tech companies or startups in Silicon Valley refer to “cultural fit” with a company, what exactly do they mean?

I originally wrote this as an answer to a question on Quora.

It’s code for “is this person like us”. That almost always means that the company lacks diversity in any form. Most of the employees tend to look the same, have similar backgrounds, and similar interests. In tech that usually means white males under 40, but that’s not always the case. It could be all Indian males under 40.

While this may lead to increased harmony and fewer conflicts, it’s also a terrible form of laziness. Companies that emphasize cultural fit will tend to be terribly deficient in HR and likely be inept at interacting with people who aren’t just like them (including customers). It’s basically a cop-out for those who can’t be bothered to make the effort to be inclusive and learn to work with people who are different.

Most places that emphasize cultural fit bear a striking resemblance to fraternity houses. That’s not my thing and I’d rather work with grownups who make an effort to function within the context of the rest of the world rather than creating their own isolated little bubbles of groupthink. I also learn more from people who aren’t just like me.

Quora Answer: What is the best way to convince a founder that agile is not the best way to do everything for an effective startup?

I originally wrote this as an answer to a question on Quora.

Good luck with that. At this point “agile” should be considered a psychological disorder in need of treatment for people who cling to it with a death grip no matter how badly it fails in their organization. Let’s hope your founder is not one of those.

Find out why they think it’s so great. It’s probably because they’ve heard that it makes developers more effective and causes you to ship higher-quality software more often. In many cases and in many organizations this is true, and they’ve probably worked somewhere where that was the case. I’ve seen it work better for larger organizations than small ones.

In places where it doesn’t work, it just adds busy work and friction to an already-challenging process. Often trotted out is the No True Scotsman fallacy — that says that if agile is failing for you, you’re not doing agile right. No, in some places it’s just doesn’t work. If you’re a smart person that it doesn’t work for, it doesn’t mean that you’re broken. You just work differently and it takes a different approach to be effective.

In many startups, adhering to some arbitrary set of rules will make people less productive than just caring about the quality of the product, doing the best you can, and making sure you’re doing the right things. Yes, you need source control and an issue tracking system and have to have your design goals written down somewhere and understood by everyone involved. It’s not because you need to keep track of whether someone is working — that’s always obvious — but you need to have enough structure to know what you’re doing now, and doing next.

Some people use agile as a crutch and excuse to not actively manage their teams. It is NOT POSSIBLE to put your development team on some sort of auto-pilot method treadmill and expect an awesome product. The builders need to talk to the business people ALL THE TIME. If this really is a proper startup, every single day you know more about how to build what you’re building and what things are or are not possible or easy/difficult, and you’ll have to revise your development plan constantly. If you’ve gone more than a week without any priorities changing, it may be possible that your company has exactly the right laser focus on exactly the right thing. More likely is that the business is not learning enough about its customer’s needs fast enough. And, in some places two or three week sprints are just too slow and cumbersome.

It might also be possible that you’ve not given it enough of a chance, but I bet you wouldn’t be asking this question if you hadn’t already given it an earnest try.

AdSense Alternatives for Startups and Small Websites

This was originally posted on wbsrch.com. It is reproduced here to preserve history.

In starting WbSrch, a search competitor to Google, I knew that at some point Google would find a way to “invite us to leave” AdSense. The Terms of Service make it clear that it is incompatible with a search engine (can’t have ads on pages that link to adult content, gambling, etc.)

That day came a little over a month ago when I received a message that ads were no longer running on the site because Google discovered a violation of their TOS in one of the result pages for a particular adult-oriented search term.

Sure, I could remove the offending link from the search results page (which I did because it also didn’t fit with the WbSrch inclusion policy), but that sort of thing would be sure to happen again. Around one sixth of the URLs on the web are porn, so it’s virtually impossible to exclude it all. Be very skeptical of anyone who claims they’re able to block all porn.

The Advertising Options

From my research, these are the notable companies that do online advertising:

Bidvertiser
Qadabra
Affinity
Infolinks
Advertising.com
Adversal
PulsePoint
Conversant (formerly ValueClick)
Clicksor
AdBlade
AdSide
Vibrant Media
Yahoo/Bing Ads (formerly Media.net)
Link Worth
Tribal Fusion
Kontera

Contacting the Advertisers

I looked into all of them, eliminating those that
require massive traffic volume to get started or have a reputation for
spreading malware.

These are the ones I tried to contact (at the end of April) asking whether their service would be compatible with WbSrch:

Qadabra
Chitika
Yahoo/Bing (formerly Media.net)
Conversant Media
Kontera
Bidvertiser
Affinity.com
Infolinks

I asked the same question of every site:

Hello,

I run a small but growing search engine at http://wbsrch.com.

I would like to know whether your service would be appropriate for use as the advertising provider for this search engine.

WbSrch.com indexes and links to most of the internet. We try to
exclude adult and other “icky” sites from the index, but that’s not
possible to do with an automated crawler. This means that at any given
time there will be links to things we don’t want to index per our policy
(http://wbsrch.com/policy/),
but that will eventually be removed. None of this content is hosted on
our site, but it is linked to depending on the search phrase used.

The search engine has indexes in 25 different languages, though most traffic is for the English-language index.

Given the nature of search engines, would WbSrch.com be compatible with your advertising platform?

What follows are the responses to this message and the action I took based on the responses.

Outright Failures

Bidvertiser had a broken captcha on their contact form, so I couldn’t contact them. Their policy says that they don’t allow linking to some content types, so
they probably would have said no.

Bing did not have a contact form. They might now. I think
they are still in alpha/beta/whatever. Even so, they’re still a
competitor, so not something wise to use long-term.

Non-Responses

Chitika never responded to my inquiry.

Conversant Media never responded to my inquiry.

Affinity.com never responded to my inquiry.

Responses

Qadabra responded the fastest, saying that they were totally
compatible with search engines and that they already had some search engine
customers. The message had a friendly tone.

Kontera was the second response. They said they they are not
compatible with search engines, but they were polite about it.

Infolinks replied three days later (on a Sunday) with a
fairly rude message that said “our quality assurance team found that your site
does not meet our publisher criteria” and “We at Infolinks
have the responsibility to keep our advertising environment up to certain
standards to ensure the success of Infolinks for our
publishers, advertisers and those viewing our ads.” OK, that’s fine if you don’t
want to work with a new site, but don’t be rude about it. At least now I know they’re too special and important to ever do business with.

The Winner

Based on these responses I went with Qadabra. They also said
that they work with traffic in all languages. Great!

Setup was easy, and ads started working immediately. I had a
few glitches with some ads behaving strangely, but it was a minor thing. Every
time I contacted them they were very helpful and friendly.

You don’t really get control over the types of ads that are
shown. Most of what I saw were ads for video games and the occasional ad for Russian
brides.

I did not enable any of their rich media ads, just banners,
so I have no experience with those. I know they earn more, but I’m generally opposed to popups, popovers, flyouts, videos, and things that make noise. If I visit a site that uses them I’m less likely to return.

Qadabra revenue was significantly less than AdSense, earning about
one sixth as much per thousand impressions. Their system documentation says
that they optimize it over time, so if I gave them a longer trial period, income
would probably go up.

Now that WbSrch has switched to SSL-only (inspired by Reset the Net), I can’t use
Qadabra. They don’t have SSL support, so even if their ads
were enabled, they wouldn’t load. If they add that I’ll consider using them
again, if not for WbSrch then for other sites.

I like the people at Qadabra, and I’m happy with their tech
support, but this experiment has ended after only one month, and there don’t
appear to be any other reasonable alternatives.

Qadabra is relatively new, created in 2011, so
they are still polishing their game. If you want a reasonable AdSense
alternative for lower-traffic sites and don’t require SSL, I recommend them.

The long-term plan always was to build an ad platform
internally to use with WbSrch. Not finding a platform that is a perfect fit for
us is just another motivating factor.

For now, I’m just going to focus on improving the search engine so we’re in a better position to monetize it later on. Since traffic has been increasing by around 100% per month for the last few months, it shouldn’t be too long.