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Jason Fried: The Truth About Real Estate
- liamk 16y agoThe title seems to be a bit of misnomer. The article provides a nice explanation of how to monetize your office space but it doesn't seem to uncover any real estate secrets!
- slater 16y agoIt tells you the truth, not secrets ;)
- jasonfried 16y agoHere's something I didn't know until I started writing for Inc: The editor, not the author, writes the title and subtitle.
- OoTheNigerian 16y agoI actually thought they bought the building but Jason provides a good explanation. I really liked the 37 seats.
- napierzaza 16y agoThis is probably firstly business porn for people to read and imagine the success. I think it's one of the 37 Signals. Isn't 37 Signals all about training and teaching people? So isn't this actually a really central part of their business model and not something anyone can really do? It's also strange that they were doing well making classes, and then didn't do that for 7-years! Then they did it again? Was there a reason it didn't matter to them so much to generate 3x their months rent so they could share with another company? "We built a theater-style classroom, with 37 seats..." Haha.
- brianbreslin 16y agothats not their primary business. they are bringing in 8 figures a year in subscription revenue from their SaaS products. why would they devote a huge chunk of their time to a 5 figure line of business. now with the bosses less integral to the day to day programming work, they can focus more time and effort on teaching, which they seem to enjoy.
- points 16y agoI'd be willing to bet the teaching, workshops etc are the funnel into which flow people, who leave thinking "wow they're cool. I better signup to a basecamp account". Without the teaching, book, blog, workshops etc, who would buy basecamp/campfire?
- brianbreslin 16y agobasecamp came before their initial workshops. they taught by blogging alot. workshops/teaching only bring in a small number of people at a time. But they do usually result in high LTV of each of those customers.
- mattmanser 16y agoIt doesn't say they stopped doing the workshops for 7 years, it says: Holding workshops there has been a logistical challenge, because those events mean that the people at Coudal Partners can't work at their own office for a day. That doesn't scale well. We'd like to be able to do a workshop every six weeks. So it doesn't sound like they stopped at all to me, just that they couldn't hold as many as they wanted.
- jasonfried 16y agoWe held a variety of workshops over the last 7 years, but we had to rent out a separate space each time. Renting out a space was expensive, more complicated than we'd like, and just a general hassle. Having our own space does away with all those negatives.
- azsromej 16y agoI think I submitted this with the same url 6 days ago ? http://news.ycombinator.com/item?id=1629588 http://news.ycombinator.com/item?id=1629588
- slater 16y agoYeah but mine's better! (bug?)
- azsromej 16y agoBested by slater again! Yeah, the urls looked the same so I wasn't sure if things were working as intended.
- OoTheNigerian 16y agoIt is all about marketing :). Same product (url) sold differently (headline, timing). one hit number one the other 0 points (I will not include the point for submitting). I have learnt a great lesson here.
- mkramlich 16y agoor subscribe to the magazine like I do and read it a month ago. :)
- points 16y agotl;dr - We learnt early on that we can make a ton of money holding 'workshops' rather than making software. Whilst still an interesting study in how you can generate a 'following' religion etc, if you're writing software, there's nothing much here. If you have a large office, and want to monetize it, there's nothing much here unless you're sure you can/want to replicate 37singles cultish following. As for the title "The truth about real estate"... Blatant linkspam. There are no 'truths' exposed. "We also believe we'll be able to charge closer to $1,000 a seat." WTF pays $1k to go to some 'workshop'? Is this Scientology or something?
- lliiffee 16y agoFor better or for worse, it isn't that unusual. https://support.sas.com/opal/external/dm https://support.sas.com/opal/external/dm
- bigohms 16y agoWith in-depth SAS mining, you are likely to recover the cost of a $2K workshop out of the gates with a day of consulting. I'm pretty sure 37 sessions offer "soft", feel good knowledge.
- pchristensen 16y agoDo you have any idea how much money people are willing to spend just to feel good?
- roc 16y agoThe title is pretty bad, but I think you're being a little harsh on the article itself. I took two things from the article that I felt were useful regardless of industry or desired customers: . keep an eye out for by-products of your primary business that you can use to add/diversify revenue -- as in the lumber mill/sawdust example . keep in mind that some pretty unsuspecting things can qualify -- as in 37 signals leveraging office space. It might help that I've long given up on expecting article content to support, or be supported by, their titles.
- deleted 16y ago[deleted]
- mcyger 16y agoThis is a poorly titled article, very typical of Inc. Magazine. It should more properly have been titled "The Truth About Your Company's Biggest Cost Center" or "How to Turn Cost into Profit". When someone refers to "Real Estate", it usually implies ownership and 37sig does not own any real estate. (One owns real estate and rents/leases space.) The remainder of the article had good advice and was well written.
- famousactress 16y agoI really think it's great that they've been able to make this a profitable venture, but I worry about the portability of the message. I've been at small companies that failed for lacking focus.. I'd be interested to hear more about how they juggled these projects and how much time and attention they took... especially at such a famously small company.
- cedsav 16y agoI think the key is that they've been in business for 11 years. You need 100% focus to build a profitable business, but once you get the recipe right (and for 37signals, when was that? 5 years ago?), it gets easier and easier to diversify.
- aun 16y agoThis is extremely relevant. I suspect those of us who are saying "this advice is non-portable" have in our heads the scenario of an unfocused company, taking needed resources away from their main product to put into the development of their "byproducts." Making the correct judgement of when the "byproduct" is sellable is key. The problem is that many companies do not make this judgement correctly. They insist, rather, on "maximizing" everything that is done, to the detriment of their main thing. 37signals themselves have posted about this in the past, sort of: "work on your best idea." If 37signals had been running workshops instead of working on Rails or Basecamp, resulting in fewer people in the Rails community or using Basecamp, then Fried's idea would be bad. They didn't do that -- but from what I'm hearing, many of us have (and are) working for companies that do behave this way, and so Fried's advice sounds bad. It isn't -- it's just missing a crucial component about judgement.
- ssharp 16y agoThe message isn't portable if you think the message is "use your office to do workshops". I don't think that's the message here.
- tptacek 16y agoYou guys all sell yourselves short. Anyone on Hacker News with any technical skill who is running a business that pays for its own decent office space has tons of things to workshop, and as long as you're based on a major metro area, people will sign up. We've done it multiple times. Stop blowing this off.
- erikb85 16y agoSo, actually he is saying that real estate and having your own beamer instead of renting one has no cost? He doesn't pay for buying it? There will be no problems after using it for some years that need some further investment? I admit that I have no idea about effectively running a real estate business. But when somebody talks like that, it seems he knows so little about it, that he probably would get better results with renting from somebody who knows how to run this kind of business.
- deleted 16y ago[deleted]
- abalashov 16y agoI would agree with those below who said the advice is largely nonportable (a trait I find to apply to most of what 37 Signals says, although it is interesting nevertheless), because most companies are not in the business of teaching or evangelism, nor should be/can be in that business. The injunction to identify and sell byproducts is a pretty bad one for most companies. Growth and success in business is achieved by returns to scale in core competencies, as a general rule. This does not mean you can't "branch out" and have other business units, but in general, loss of focus, especially for a small company and/or startup, can be devastating if already thin resources are cannibalised for some new offering wholly unrelated to the original mission.
- jasonfried 16y agoI went to a pig butchering demo a few weeks ago at a local restaurant. It was on a Sunday morning when the restaurant wasn't open. Admission was $50. They had about 20 people there. That's $1000 to the restaurant on a Sunday morning when they are usually closed to the public. They were butchering the pig anyway, but by turning it into a $50/seat class they were able to significantly increase their profit margin on that pig. It didn't get in their way, it didn't cause them to lose focus. What it did was increase their profits and get people excited about eating at their restaurant. I know I wanted to go back and taste some of that pork. It's great business.
- jakewalker 16y agoReminds me of Zingermans in Ann Arbor, where Ari & company have turned a deli into a deli, baking classes, creamery, cheese-making demos, business training center, restaurant, dinner events, etc. For every new business Zingermans opens, they find a way to turn the business into a place where they can host events (dinners, earlier in the summer they had a bacon festival, they sometimes teach their method of opening their books to all employees, etc.) and really create profit and excitement in non-traditional ways. See http://www.zingermanscommunity.com/our-businesses http://www.zingermanscommunity.com/our-businesses Jason's right; while not everyone may be able to turn their office into a place where people pay $1,000 a head to attend a workshop, there is certainly something to learn from thinking about how to utilize your business/office space/etc. to earn incremental revenue and promote your business.
- run4yourlives 16y agoI wonder how many of you that fail to see the transfer of knowledge or "teaching" as the real web 2.0 revolution are out their building the next "social" whatever. From the comments it seems pretty common. Facebook and farmville are the ghettos of the social media world, playing to the same audience feelings that Jerry Springer did in the 90's. Remember, we all watched that show back then. The real force in social media is what it will do to teaching, and 37Signals is recognizing this in spades. Instead of professionals transferring knowledge to schools and teachers to transfer into the student; diluting it, by default, they can now transfer knowledge directly, for better or worse.
- maw 16y agoFacebook and farmville are the ghettos of the social media world, playing to the same audience feelings that Jerry Springer did in the 90's. Remember, we all watched that show back then. No, we did not.
- didip 16y ago"Facebook and farmville are the ghettos of the social media world" I thought that title is exclusive to MySpace? I'd say Facebook is the suburbia of online media. It gives the illusion of being connected to people the same way suburbia gives the illusion of American Dream to home owners.
- chopsueyar 16y agoOK, so what is the metropolis/urban core of online media?
- pkaler 16y agoFacebook and farmville are the ghettos of the social media world They are more like the soap operas of the social media world. In the 70s, 80s, and 90s the decision maker in the household would have nothing to do at 2PM in the afternoon. Companies like P&G and Johnson & Johnson sponsored soap operas to blast advertising about household products at the key decision makers. Hence the term "soap" opera. In the early 2000s we saw the rise of mommy bloggers. P&G, J&J started advertising on blogs. Suddenly, the key decision makers became sneezers, too. They were purchasing product but they were also writing and evangelizing products, too. The last few years we have seen Farmville and other social games. Here's the result of a quick Google search for P&G and Facebook. http://www.insidefacebook.com/2010/01/23/facebook-roundup-page-admin-changes-proctor-gamble-ftc-dave-morin-zynga-kissmetrics-and-soccer/ http://www.insidefacebook.com/2010/01/23/facebook-roundup-pa... Farmville becomes another channel for these brand to get their product in front of consumers. Social games should be called soap games.
- patfla 16y agoI'm wary of any article that begins: "The Truth About ..." and I haven't read this one yet. "The Truth About ..." is designed to get your juices flowing and to get you to read. Caveat lector.
- hugh3 16y agoExactly. It seems to be a general law that the presence of the words "The Truth" on the cover of any book decreases the chance of it actually containing any truth by about 90%. If you want to know about evolution or the Holocaust then you pick up the book called "Evolution" or "The Holocaust", not "The Truth About Evolution" or "The Truth About the Holocaust".
- patrickaljord 16y agoWhy does this article say it was published on sept 1st 2010?
- kgermino 16y agoIirc this is a website for a magazine. Most such websites use the date the article is printed as the publication date rather than the date the article becomes available online. Gotta love old media.
- deleted 16y ago[deleted]
- edw519 16y agoMy last physical office was basically free. I rented it out to a Jewish group on Friday nights, a Christian group on Sunday mornings, and one Saturday night per month for each group. It had everything both groups needed: the conference room table folded out of the way so it could seat 30. There was also a piano, a full kitchen, a full bath, and plenty of parking on weekends. The private offices were locked. Weekend income paid the whole bill. Not a bad deal.
- iuhjytgfbnjhmk 16y agoplus you are insured against acts of God (or at least 2 out of 3!)
- mscarborough 16y agoThe lower bounds might be two but probably not 2 out of 3 :) Though that is a smart plan if it works out so well for the GP.
- iuhjytgfbnjhmk 16y agoWell you are covering 2 out of 3 of the supporters of the God with the most previous convictions for wholesale wrath of God stuff. You only need to rent it out to as a mosque on friday mornings and you should be safe. Zeus and Thor seem to have retired from the raining down thunderbolts business, Bhudda was never particularly into it and Krishna doesn't do overseas.
- iuhjytgfbnjhmk 16y agoWas the downvoter anti-muslim or pro-Thor?