Monday, November 24, 2008

37signals, the myth

I have been planning to write on this for a long time. Actually this subject is the everlasting debate between me and my friend Mohammed Ali, whom is our CTO at the same time.

So 37signals managed to make lots, and lots of money just from the simple advice, "Put a price tag" . They have been attacking investment models, and they always looked at money spent in investments for ad based projects a loss of money. Although I can not totally disagree with them on the second point, I surely don't see how putting a price tag could be the magical solution for all problems, or else there would have seen much more companies joining the success track of 37signals.
Sure there is a missing ingredient which DHH is keep in the closet. From my humble point of view, It is called marketing.

Know your market, and attack it. Even though 37signals did this unconsciously, they played in their market "Developers Market". Armed with the reputation of makers of Rails, they offered project management utilities. Sure anyone would at least try the tools used by the Rails makers.. I did :). You will gain money as much as you know your market dynamics, don't think of the world as a market, choose a slice of, but make sure to choose the slice that you know most.

At the end 37signals were able to put their price, simply because they were well marketed. No matter if you are a service provider or an ad based portal, you need to know your market well. No matter how big or small this market is, if you were able to push yourself in it, and know what it needs, you will get your money.

No comments: