4 ms·

i run a small tech company, though not an ISP. i hear this question a lot. "how do you compete with xyz megacorp?" delivering a better/faster product for les

i run a small tech company, though not an ISP. i hear this question a lot. "how do you compete with xyz megacorp?" delivering a better/faster product for less money, is the easy part. nearly everything is overpriced from megacorps. believe me, it's easy. even the accounting is harder. the hard part is selling it. people will complain all day about megacorp sucking, but when it comes right down to it, they won't go with the little guy 99% of the time even when the benefits are staring them right in the face. unless of course, you happen to offer a service in an area the big guys simply don't exist in, which is awesome and good for OP for spotting the opportunity.

chrishacken 10y ago
I'm working on a deal with a local private school and that was the first question I got. "How can you offer faster speeds and better pricing than Frontier, Verizon, etc?". They were previously paying $2,000/m for 100 Mbps. It's not that hard to compete with that. haha
- beachstartup 10y ago
  i've considered the psychology of our position. the difficult part is getting someone to understand that they have been vastly overpaying -- that means they must call into question their own (past) judgment, which for some people is easy, but for most people, is extremely hard (mild cognitive dissonance). i find it especially interesting that the question is coming from a small private school, who's business model is basically the same thing. i.e. offering a superior alternative to larger, better funded incumbent institutions.
  - emodendroket 10y ago
    > offering a superior alternative to larger, better funded incumbent institutions. I don't know that that is necessarily an accurate way of describing the role of a private school.
    - beachstartup 10y ago
      so how would you describe it?
      - akiselev 10y ago
        Well, considering that the biggest period of growth private schools experienced was during desegregation, I would wager that most private schools exist as an escape hatch for parents who find their school district undesirable for one reason or another. Also, most private school students in the US go to a religiously-affiliated institution so there is a strong element of religious indoctrination there. Stereotypically, charter schools are the ones that are supposed to be better than public schools at a cheaper cost to the government (charter schools can be private or quasi-public).
        emodendroket 10y ago
        > Stereotypically, charter schools are the ones that are supposed to be better than public schools at a cheaper cost to the government (charter schools can be private or quasi-public). I'd also question the extent to which reality bears this one out, but yes, that is the view.
      - emodendroket 10y ago
        I'd bet that private schools, on average, have more money per pupil than public ones.
emodendroket 10y ago
I mean surely the biggest thing is that if my ATT service goes out I can probably get someone on the phone (especially if I'm a business customer).
- beachstartup 10y ago
  it's easier to get the small provider on the phone. but i mean, this is simply what you believe to be true. in reality, it doesn't matter if it's true or not, because you believe it. that's what small companies fight against every day of their life.
  - emodendroket 10y ago
    I'm sure he runs a great business, but unless the man never sleeps or goes on vacation he can't always be available in minutes.
    - beachstartup 10y ago
      you don't actually understand what it takes to run a small technology business, because you're a guy who just has a normal job. you don't make a lot of money because there aren't a lot of expectations and obligations in your line of work. 1. yup. he doesn't take vacations. 2. if he's sleeping, he gets woken up, or he loses the business. when you run a business there's nobody to pass the buck to. it's your problem, end of story. you're a big boy now, pull up those pants. ask a line cook or sous chef how many vacations and how much sleep they get. there are people who get blown up by bombs in the middle east, today. right now. those are real people. do you think not taking a vacation is some kind of huge sacrifice in the grand scheme of things, especially if you're trying to make a large amount of money? these are the hard facts that people don't write fun blog posts about and that normal people with jobs find impossible to believe because they are not business owners and never will be.
      - emodendroket 10y ago
        > there are people who get blown up by bombs in the middle east, today. right now. those are real people. do you think not taking a vacation is some kind of huge sacrifice in the grand scheme of things, especially if you're trying to make a large amount of money? Give me a break; what the hell does that have to do with the discussion? Forget about the vacation then. Suppose he gets hit by a car.
IkmoIkmo 10y ago
This is true outside of tech as well. Work at a midcorp with about 50-100 offices worldwide, we have 21 year old juniors who don't know shit (like me) follow templates and flowcharts to do bulk legal or accounting work, slightly more complex than data-entry, we charge clients $250 an hour. Most of the kids do have plenty of critical thinking competencies, but knowledge wise it's a few days of on the job training, it virtually doesn't matter if you majored in erotic dance or tax law, pretty much anyone can do the work... each of these kids generates close to half a million in revenue per year. And the costs are essentially salaries (averaging $25 including benefits and all) and an office (a fraction of that), profit margins are about 75%. Those rates are utterly ridiculous because the work can be done from any location, a lot of these companies are in 2nd tier cities where the cost of living is very reasonable. I won't even go into the opportunities of automating this stuff, but it's ridiculous... But the hard part is selling it. I could easily run a team of 10 of these juniors who produce the same work (volume and quality) that generates $5m in revenue a year at the bigcorp, on a budget of 0.5m. Business wise it's almost free money, but without the big corp brand name, it's really hard to sell, even prices were cut by 50% or more and you put sales agents are ridiculous commissions. It's just crazy how important it is to clients to interface with a big brand name corp, despite the fact the actual people doing much of the work are on the level of interns. This is true for lots of finance/legal/consulting companies I find.
- czbond 10y ago
  The reason is "exposure". Big companies want someone whom they believe has experience, and whom they can hold liable if there are problems. It's not the company spending the money - it is a collection of corporate people spending a budget allotted to them, who want a promotion.
  - 1812Overture 10y ago
    "No one gets fired for buying an IBM"
- knite 10y ago
  What sort of bulk work is this? If margins are this good, it sounds like a real market opportunity!

chrishacken 10y ago

I'm working on a deal with a local private school and that was the first question I got. "How can you offer faster speeds and better pricing than Frontier, Verizon, etc?". They were previously paying $2,000/m for 100 Mbps. It's not that hard to compete with that. haha

beachstartup 10y ago
i've considered the psychology of our position. the difficult part is getting someone to understand that they have been vastly overpaying -- that means they must call into question their own (past) judgment, which for some people is easy, but for most people, is extremely hard (mild cognitive dissonance). i find it especially interesting that the question is coming from a small private school, who's business model is basically the same thing. i.e. offering a superior alternative to larger, better funded incumbent institutions.
- emodendroket 10y ago
  > offering a superior alternative to larger, better funded incumbent institutions. I don't know that that is necessarily an accurate way of describing the role of a private school.
  - beachstartup 10y ago
    so how would you describe it?
    - akiselev 10y ago
      Well, considering that the biggest period of growth private schools experienced was during desegregation, I would wager that most private schools exist as an escape hatch for parents who find their school district undesirable for one reason or another. Also, most private school students in the US go to a religiously-affiliated institution so there is a strong element of religious indoctrination there. Stereotypically, charter schools are the ones that are supposed to be better than public schools at a cheaper cost to the government (charter schools can be private or quasi-public).
      - emodendroket 10y ago
        > Stereotypically, charter schools are the ones that are supposed to be better than public schools at a cheaper cost to the government (charter schools can be private or quasi-public). I'd also question the extent to which reality bears this one out, but yes, that is the view.
    - emodendroket 10y ago
      I'd bet that private schools, on average, have more money per pupil than public ones.

emodendroket 10y ago

I mean surely the biggest thing is that if my ATT service goes out I can probably get someone on the phone (especially if I'm a business customer).

beachstartup 10y ago
it's easier to get the small provider on the phone. but i mean, this is simply what you believe to be true. in reality, it doesn't matter if it's true or not, because you believe it. that's what small companies fight against every day of their life.
- emodendroket 10y ago
  I'm sure he runs a great business, but unless the man never sleeps or goes on vacation he can't always be available in minutes.
  - beachstartup 10y ago
    you don't actually understand what it takes to run a small technology business, because you're a guy who just has a normal job. you don't make a lot of money because there aren't a lot of expectations and obligations in your line of work. 1. yup. he doesn't take vacations. 2. if he's sleeping, he gets woken up, or he loses the business. when you run a business there's nobody to pass the buck to. it's your problem, end of story. you're a big boy now, pull up those pants. ask a line cook or sous chef how many vacations and how much sleep they get. there are people who get blown up by bombs in the middle east, today. right now. those are real people. do you think not taking a vacation is some kind of huge sacrifice in the grand scheme of things, especially if you're trying to make a large amount of money? these are the hard facts that people don't write fun blog posts about and that normal people with jobs find impossible to believe because they are not business owners and never will be.
    - emodendroket 10y ago
      > there are people who get blown up by bombs in the middle east, today. right now. those are real people. do you think not taking a vacation is some kind of huge sacrifice in the grand scheme of things, especially if you're trying to make a large amount of money? Give me a break; what the hell does that have to do with the discussion? Forget about the vacation then. Suppose he gets hit by a car.

IkmoIkmo 10y ago

This is true outside of tech as well. Work at a midcorp with about 50-100 offices worldwide, we have 21 year old juniors who don't know shit (like me) follow templates and flowcharts to do bulk legal or accounting work, slightly more complex than data-entry, we charge clients $250 an hour. Most of the kids do have plenty of critical thinking competencies, but knowledge wise it's a few days of on the job training, it virtually doesn't matter if you majored in erotic dance or tax law, pretty much anyone can do the work... each of these kids generates close to half a million in revenue per year. And the costs are essentially salaries (averaging $25 including benefits and all) and an office (a fraction of that), profit margins are about 75%. Those rates are utterly ridiculous because the work can be done from any location, a lot of these companies are in 2nd tier cities where the cost of living is very reasonable. I won't even go into the opportunities of automating this stuff, but it's ridiculous... But the hard part is selling it. I could easily run a team of 10 of these juniors who produce the same work (volume and quality) that generates $5m in revenue a year at the bigcorp, on a budget of 0.5m. Business wise it's almost free money, but without the big corp brand name, it's really hard to sell, even prices were cut by 50% or more and you put sales agents are ridiculous commissions. It's just crazy how important it is to clients to interface with a big brand name corp, despite the fact the actual people doing much of the work are on the level of interns. This is true for lots of finance/legal/consulting companies I find.

czbond 10y ago
The reason is "exposure". Big companies want someone whom they believe has experience, and whom they can hold liable if there are problems. It's not the company spending the money - it is a collection of corporate people spending a budget allotted to them, who want a promotion.
- 1812Overture 10y ago
  "No one gets fired for buying an IBM"
knite 10y ago
What sort of bulk work is this? If margins are this good, it sounds like a real market opportunity!