In most countries there are laws against being anti competitive. What that means is that you cannot open up a gas station and sell gas for 1/2 price at a loss. Even if you business plan was to sell more soft drinks and chocolate bars you still can't do that.
Behind most competition acts is an understanding that you can't start a business to ruin somebody else. Often times big companies get a accused of this and a huge legal battle begins. Generally if you want to sell something there is always a bottom line which you cannot go below otherwise you lose money and it isn't a business.
But when it comes to selling software anti competition sentiments seem to not matter at all. From a small business point of view if you are not selling your software for at least 10 dollars you will be losing money. It's really hard to make money off of 1 dollar apps and it is even more challenging to make money off of freemium.
Wednesday, 1 May 2013
Friday, 26 April 2013
Should you build your own game engine?
Lot's of times you will see companies use their own native engine. Other times you will see them use a proprietary one like the unreal engine. Should you build your own engine?
If you want to make games in your basement/garage/bedroom, the answer is 100% no. You don't have time for that. You have to get your game out to the public as soon as possible. Even if you go long term should you build your own game engine? Why do people do it?
Well, the first reason is that when you flip your game business it is worth more if you have that software. Instead of just having characters and titles you also have engine and code to sell as well. It could be worth it.
Personally, I do not have time to code my own engine. I just want to get my game out as fast as I can so people can play it. I have too many ideas and not enough time. I would advise against building your own engine. I would just use unity3d. It is the easiest 3D engine to use.
If you want to make games in your basement/garage/bedroom, the answer is 100% no. You don't have time for that. You have to get your game out to the public as soon as possible. Even if you go long term should you build your own game engine? Why do people do it?
Well, the first reason is that when you flip your game business it is worth more if you have that software. Instead of just having characters and titles you also have engine and code to sell as well. It could be worth it.
Personally, I do not have time to code my own engine. I just want to get my game out as fast as I can so people can play it. I have too many ideas and not enough time. I would advise against building your own engine. I would just use unity3d. It is the easiest 3D engine to use.
Sunday, 21 April 2013
How much should you really save
As an entrepreneur I have no pension. I also like to talk about success and that is more than just building apps. So on this blog you will hear some financial advice as well. Surprisingly most people don't have a pension at their job. If you are under 30 you stay at a job for 3 years before you get board of it and you move on. So even then you are not really eligible for a pension. Furthermore pensions have changed and they do not favor you as much as they did in the past. Most people think that a pension is where the company just pays you money. In reality you build your own pension.
So how much should you really save? Well you should save about as much as you pay rent. Let's assume that your rent is 1000 per month you should save the equivalent. But really you should save about double. If you do the math, you should roughly have 500k saved up by the time you are 65. Here is the formula
Age - 65 * -1 *12 * monthly savings
So if you plugin the numbers(assuming you are 25)
25 - 65 *-1 * 12 * 1000 = 480 000.
So if you want a million dollar pension you better start saving. In fact you should probably put 2k in per month. If you have a plan where the company will match your investment then 1k should suffice.
But good luck finding a job that pays you enough to actually do this. One thing you can do is start a business and 100% of those proceeds go to retirement.
So how much should you really save? Well you should save about as much as you pay rent. Let's assume that your rent is 1000 per month you should save the equivalent. But really you should save about double. If you do the math, you should roughly have 500k saved up by the time you are 65. Here is the formula
Age - 65 * -1 *12 * monthly savings
So if you plugin the numbers(assuming you are 25)
25 - 65 *-1 * 12 * 1000 = 480 000.
So if you want a million dollar pension you better start saving. In fact you should probably put 2k in per month. If you have a plan where the company will match your investment then 1k should suffice.
But good luck finding a job that pays you enough to actually do this. One thing you can do is start a business and 100% of those proceeds go to retirement.
Wednesday, 17 April 2013
Learning something new
You should always be learning something new. You don't have to be amazing at it but you should try and learn something new to keep your brain active. You should also learn physical activities as well. Learn a new stretch or add a new exercise to your work out. If you don't exercise please start.
In addition to the fun facts about the tech industry you will see my progress on my electric skateboard as well.
I have never skateboarded in my life but I went to the parking lot and tried it. Why not? Just try something new, when you try something new you learn.
In addition to the fun facts about the tech industry you will see my progress on my electric skateboard as well.
I have never skateboarded in my life but I went to the parking lot and tried it. Why not? Just try something new, when you try something new you learn.
Tuesday, 16 April 2013
Why you should charge more money for your product
Most people by definition grew up in a standard middle class home. This means that money was always on the tight side and that means that people's spending habits are very conscious. But there are people who spend lots of money, way more money than what most people are used to spending.
I often see people charging way too little for their products. Remember if you want to attract 1000 people to your website it will cost the same. So if this case then why not have big ticket items when they get there.
Have you ever walked into a store and saw a special item for sale that was extremely expensive? This is done on purpose so that when a high roller comes in they can make a lot of money. Just imagine one customer buying something for 10 000 dollars!
I often see people charging way too little for their products. Remember if you want to attract 1000 people to your website it will cost the same. So if this case then why not have big ticket items when they get there.
Have you ever walked into a store and saw a special item for sale that was extremely expensive? This is done on purpose so that when a high roller comes in they can make a lot of money. Just imagine one customer buying something for 10 000 dollars!
Monday, 15 April 2013
When you know you have a good idea and drop everything to persue it
Here is a little story about an event that happened 2 weeks ago. When I was a kid I wanted to make a hovercraft. I went to the library and thoroughly researched it. I found out it wasn't feasible. I then researched how to make a gas-powered or an electric skateboard. Again it wasn't feasible.
Fast forward to the present and I saw a ted talk on electric skateboards. Apparently, both motors and batteries have come up leaps and bounds since I was a kid and I instantly wanted start building them and selling them. Since Im an entrepreneur I know how to get something up and out the door.
Im always looking for more revenue streams and eventually I wanted to branch out into physical products. This was the perfect project for me. The only problem is that I haven't produced physical products, I produce software.
The main reason a physical product like this would be great is that I could charge a lot of money, and I wouldn't have to sell a lot to make a profit. This way I wouldn't have to sell a lot to make a livable income. Also buy working with something different, it would make the some of the "boring" software work more fun.
Lot's of people do make stuff in their homes and sell it. It is a very easy and simple way to make money.
So I researched everything I possibly could but in the end I had to say no to the idea. The reason is too much liability. I learned a very valuable lesson here which is that software is much easier to produce than physical products. I'm going to stick with software for now.
In the end I will just build an electric skateboard for myself. I will post pictures a long the way.
Fast forward to the present and I saw a ted talk on electric skateboards. Apparently, both motors and batteries have come up leaps and bounds since I was a kid and I instantly wanted start building them and selling them. Since Im an entrepreneur I know how to get something up and out the door.
Im always looking for more revenue streams and eventually I wanted to branch out into physical products. This was the perfect project for me. The only problem is that I haven't produced physical products, I produce software.
The main reason a physical product like this would be great is that I could charge a lot of money, and I wouldn't have to sell a lot to make a profit. This way I wouldn't have to sell a lot to make a livable income. Also buy working with something different, it would make the some of the "boring" software work more fun.
Lot's of people do make stuff in their homes and sell it. It is a very easy and simple way to make money.
So I researched everything I possibly could but in the end I had to say no to the idea. The reason is too much liability. I learned a very valuable lesson here which is that software is much easier to produce than physical products. I'm going to stick with software for now.
In the end I will just build an electric skateboard for myself. I will post pictures a long the way.
Sunday, 14 April 2013
Tech companies compared to oil companies
Most people tend to think of oil companies as evil. They see something like the gulf oil spill and pipeline spills and they brand oil as evil. As a result most people have a negative view towards oil companies.
Tech companies on the other hand change society for the better and most people view tech companies as progressive and sadly "hip". But what if I told you that tech companies were doing something that was equally as destructive to spilling oil over the environment? That destructive force is not hiring enough employees.
Sadly the companies that do hire lots of people, like Microsoft, have a bad image. I blame the fact that the companies that do not hire enough people, the companies that people like actually make vanity products, instead of productive products. That's right instagram and facebook have more in common with cosmetics versus production. Beauty and vanity are like wine. A little bit is a fantastic part of living but too much of it can lead to problems.
If you take a look at this website you can see how much employees the average employee would make at a tech company.
http://www.web-strategist.com/blog/2013/03/18/social-networks-by-revenue-and-employees-facebook-stands-above-all/
Here is the chart.
You have probably heard that the middle class is being eroded and that the jobs of the past are not here today. Well, it isn't the fact that companies are not making money it is the fact that they aren't hiring enough.
As I have said before, the easiest way for a tech company to be triple bottom line is to hire more people. The only problem with this is that most of these companies don't actually charge money for their products. They have a very asymmetrical route to profit. As a business owner it would be really hard to base employee salaries over this asymmetric route to profit.
The worst part of the situation is that when companies charge money for products they are seen as uncool and usually frowned upon.
One day this bubble will pass and I welcome that day.
Tech companies on the other hand change society for the better and most people view tech companies as progressive and sadly "hip". But what if I told you that tech companies were doing something that was equally as destructive to spilling oil over the environment? That destructive force is not hiring enough employees.
Sadly the companies that do hire lots of people, like Microsoft, have a bad image. I blame the fact that the companies that do not hire enough people, the companies that people like actually make vanity products, instead of productive products. That's right instagram and facebook have more in common with cosmetics versus production. Beauty and vanity are like wine. A little bit is a fantastic part of living but too much of it can lead to problems.
If you take a look at this website you can see how much employees the average employee would make at a tech company.
http://www.web-strategist.com/blog/2013/03/18/social-networks-by-revenue-and-employees-facebook-stands-above-all/
Here is the chart.
| Company | 2012 Reported Revenues | Employees | Revenue Per Employee |
| $5,089,000,000 | 4,619 | $1,101,753 | |
| Zynga | $1,281,267,000 | 2,916 | $439,391 |
| $350,000,000 | 900 | $388,888 | |
| Automattic (WordPress) | $45,000,000 | 150 | $300,000 |
| $972,309,000 | 3,458 | $281,176 | |
| Groupon | $2,330,000,000 | 10,000 | $233,000 |
| LivingSocial | $536,000,000 | 4,500 | $119,111 |
| Yelp | $137,600,000 | 1,214 | $113,344 |
| Tumblr | $13,000,000 | 151 | $86,092 |
| Foursquare | $2,000,000 | 100 | $20,000 |
You have probably heard that the middle class is being eroded and that the jobs of the past are not here today. Well, it isn't the fact that companies are not making money it is the fact that they aren't hiring enough.
As I have said before, the easiest way for a tech company to be triple bottom line is to hire more people. The only problem with this is that most of these companies don't actually charge money for their products. They have a very asymmetrical route to profit. As a business owner it would be really hard to base employee salaries over this asymmetric route to profit.
The worst part of the situation is that when companies charge money for products they are seen as uncool and usually frowned upon.
One day this bubble will pass and I welcome that day.
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