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The only reason I would never go this direction with my business is because you could wake up tomorrow and the features of your app become a standard feature of

by dpcan 6y ago

The only reason I would never go this direction with my business is because you could wake up tomorrow and the features of your app become a standard feature of Shopify and you’re instantly out of business. Think flashlight apps for iPhone, health apps, etc.

paulgb 6y ago
Apple is so famous for this that there is a wikipedia page about the word for it[1]. Does Shopify have a reputation for doing this? I'm not really in that world but my impression is that they value their third party developers better than Apple does. [1] https://en.wikipedia.org/wiki/Sherlock_(software) https://en.wikipedia.org/wiki/Sherlock_(software)
akudha 6y ago
That is true. But note that they are based in Bangalore, 25K USD MRR is a ton of money (it is a lot of money even in the US). If they maintain this for just a year or two, they're likely set for life. Sometimes it works out to just ride the wave :)
- blackrock 6y ago
  $25k USD monthly, is $300k a year. Not bad, if it keeps running on autopilot for a few years. Say, you can keep it running for 3 years. This is close to $1 million USD gross. This could easily pay your cost of living, while you work on the next product. But you must also factor in taxes. But this is HN, so of course all this is obvious. To quote the adjacent comment: “No sh*t Sherlock”
  - cambalache 6y ago
    > $25k USD monthly, is $300k a year. Gross Income, for 2 partners. As I wrote, best case you get 100k per partner net after 2 years, ceteris paribus. But they are living from this business so less money for the company. > Say, you can keep it running for 3 years. This is close to $1 million USD. This could easily pay your cost of living, while you work on the next product. Yes but that is a truism. If your business does well for several years, you will have a cushion for your next venture. I wrote because I wanted to write against the naive view many people in HN has about "developing countries", yes COL is lower but there is no magic place where 100k USD will set you for life. You still have to pay taxes, many goods cost the same or more than in the US, good healthare insurance is not low, etc, etc. My rule of thumb is that you need at least a mimimum 1MM to retire, no matter in which part of the world,of course if you pick London or Zurich the amount will need to be higher. This assume a family of 3, no further income, no house owned and to live a modest middle class lifestyle.
  - bluedino 6y ago
    There are also costs for the business. For example, 2.2 million WhatsApp chat messages initiated in June 2,200,000 * $0.005 per session message (Twilio cost for WhatsApp messages to India) = $11,000 I probably have that wrong, but I'm sure that's a big expense.
- cambalache 6y ago
  25 K/month x 2 years x(1/2 partners) = 150k 150k * 0.66 (extremely optimistic gross to net-income factor) = 100K You and me have different notions of "set for life" EDIT: I fudged a factor of 2 in the math, the final number is 200k, my point still stands.
  - Drdrdrq 6y ago
    200k actually, I think you made a mistake? Anyway, in some parts of the world, yes, that is "set for life".
    - cambalache 6y ago
      200k for 2 partners, 100k each. Tell me this magical place where I am set for life with 100k, i will fly as soon as travel is available. 100k assuming a 4% annual retirement rate, gives you 333 USD/month. Assuming a family of 2 and you need to pay rent, insurance,food,car or transportation, etc I dont see this feasible at all, at the very very least you need 5X times that.
      - deleted 6y ago
        [deleted]
      - badideaprojects 6y ago
        Lots of parts of the world where people with families live for less than 1.5k USD a month.
        cambalache 6y ago
        Yes! But even for 1500 USD/month you need 500k on your portfolio. And another thing , just because you live in a developing nation does not mean you dont aspire to nice things. You still need a laptop, a modern car, a cell phone, etc etc.
      - kvetching 6y ago
        Wow you're head is so far in the sand it's insane. You literally have no idea how far USD can go in third world countries.
- ramraj07 6y ago
  Not subtracting anything but wanted to mention that taxes in India are quite high. Also you can actually get paid quite well for a job in Bangalore, so it's not quite that much. It is, if after two years of work it goes into autopilot but as a full time job it might not be with it for two smart engineers in India.
kh30 6y ago
As a former PM at Shopify, I think the risk of this is pretty low. Shopify optimizes for building things into the core product that at least 80% of the merchants can use. On top of that, they are pretty slow to get things to market given they are a big company. That said, the risk is not zero. But if you pick a good niche and stay differentiated, it’s less than you’d think.
- lovesdogsnsnow 6y ago
  Would love to talk shop on the space.
stunt 6y ago
That's a good point. But, for this case I don't think they are going to get sherlocked any time soon. Shopify probably has much more important missing core features to add.
Axsuul 6y ago
Why would you instantly be out of business?
bluedino 6y ago
Or have many clones because you have such a simple app, which happened to them, causing them to lower their prices.
econcon 6y ago
There is a really nice free app called "Discourse" for making forums but no such nice app for launching an e-commerce website with free plugins ecosystem. Is there a specific reason that free high quality forum software can be built but not e-commerce?
- bishalb 6y ago
  There's woocommerce/wordpress. You need not use paid plugins while starting out, the free ones should be sufficient. One might argue it's not "nice" enough but there are thousands of successful businesses built on top of it.
  - econcon 6y ago
    If you go to /r/WooCommerce you'll see growing pains and that people are not happy in general with WooCommerce and plugin developers have to work extra hard to support ever changing WordPress. There is a need of stable (not frequently changing) e-commerce app that can be hosted and supports stripe/PayPal and "shipment tracking". WooCommerce requires yearly payment for shipment tracking. When discourse is available for free, there is no reason why WooCommerce alternative which can provide more out of box support can't be free. Today what options people have? WooCommerce, Shopify (SaaS) and legacy apps like Magento, Presto, Opencart. This is not enough - most e-commerce development happens on agencies selling their services. We can certainly provide more out of box features with help of open develop model.
    - bishalb 6y ago
      Which platform doesn't have issues? I am sure if you go check discourse's official forum, you will see it has its fair share of problems and shortcomings too. I just did a quick search and found that there is a plugin called advanced shipment tracking for woocommece which seems to be free and gets the job done(i am sure it has a paid version too but the free one seems to be good enough, judging from the reviews) Also e-commerce site owners are entrepreneurs and the primary goal of any e-commerce site is to make money. The primary goal of a discourse forum isnt making money. E-commerce owners are more likely to invest in tools that help them grow their business, unlike someone who runs a forum, where there might not be such a motivation.

by dpcan 6y ago

paulgb 6y ago

Apple is so famous for this that there is a wikipedia page about the word for it[1]. Does Shopify have a reputation for doing this? I'm not really in that world but my impression is that they value their third party developers better than Apple does. [1] https://en.wikipedia.org/wiki/Sherlock_(software) https://en.wikipedia.org/wiki/Sherlock_(software)

akudha 6y ago

That is true. But note that they are based in Bangalore, 25K USD MRR is a ton of money (it is a lot of money even in the US). If they maintain this for just a year or two, they're likely set for life. Sometimes it works out to just ride the wave :)

blackrock 6y ago
$25k USD monthly, is $300k a year. Not bad, if it keeps running on autopilot for a few years. Say, you can keep it running for 3 years. This is close to $1 million USD gross. This could easily pay your cost of living, while you work on the next product. But you must also factor in taxes. But this is HN, so of course all this is obvious. To quote the adjacent comment: “No sh*t Sherlock”
- cambalache 6y ago
  > $25k USD monthly, is $300k a year. Gross Income, for 2 partners. As I wrote, best case you get 100k per partner net after 2 years, ceteris paribus. But they are living from this business so less money for the company. > Say, you can keep it running for 3 years. This is close to $1 million USD. This could easily pay your cost of living, while you work on the next product. Yes but that is a truism. If your business does well for several years, you will have a cushion for your next venture. I wrote because I wanted to write against the naive view many people in HN has about "developing countries", yes COL is lower but there is no magic place where 100k USD will set you for life. You still have to pay taxes, many goods cost the same or more than in the US, good healthare insurance is not low, etc, etc. My rule of thumb is that you need at least a mimimum 1MM to retire, no matter in which part of the world,of course if you pick London or Zurich the amount will need to be higher. This assume a family of 3, no further income, no house owned and to live a modest middle class lifestyle.
- bluedino 6y ago
  There are also costs for the business. For example, 2.2 million WhatsApp chat messages initiated in June 2,200,000 * $0.005 per session message (Twilio cost for WhatsApp messages to India) = $11,000 I probably have that wrong, but I'm sure that's a big expense.
cambalache 6y ago
25 K/month x 2 years x(1/2 partners) = 150k 150k * 0.66 (extremely optimistic gross to net-income factor) = 100K You and me have different notions of "set for life" EDIT: I fudged a factor of 2 in the math, the final number is 200k, my point still stands.
- Drdrdrq 6y ago
  200k actually, I think you made a mistake? Anyway, in some parts of the world, yes, that is "set for life".
  - cambalache 6y ago
    200k for 2 partners, 100k each. Tell me this magical place where I am set for life with 100k, i will fly as soon as travel is available. 100k assuming a 4% annual retirement rate, gives you 333 USD/month. Assuming a family of 2 and you need to pay rent, insurance,food,car or transportation, etc I dont see this feasible at all, at the very very least you need 5X times that.
    - deleted 6y ago
      [deleted]
    - badideaprojects 6y ago
      Lots of parts of the world where people with families live for less than 1.5k USD a month.
      - cambalache 6y ago
        Yes! But even for 1500 USD/month you need 500k on your portfolio. And another thing , just because you live in a developing nation does not mean you dont aspire to nice things. You still need a laptop, a modern car, a cell phone, etc etc.
    - kvetching 6y ago
      Wow you're head is so far in the sand it's insane. You literally have no idea how far USD can go in third world countries.
ramraj07 6y ago
Not subtracting anything but wanted to mention that taxes in India are quite high. Also you can actually get paid quite well for a job in Bangalore, so it's not quite that much. It is, if after two years of work it goes into autopilot but as a full time job it might not be with it for two smart engineers in India.

kh30 6y ago

As a former PM at Shopify, I think the risk of this is pretty low. Shopify optimizes for building things into the core product that at least 80% of the merchants can use. On top of that, they are pretty slow to get things to market given they are a big company. That said, the risk is not zero. But if you pick a good niche and stay differentiated, it’s less than you’d think.

lovesdogsnsnow 6y ago
Would love to talk shop on the space.

stunt 6y ago

That's a good point. But, for this case I don't think they are going to get sherlocked any time soon. Shopify probably has much more important missing core features to add.

Axsuul 6y ago

Why would you instantly be out of business?

bluedino 6y ago

Or have many clones because you have such a simple app, which happened to them, causing them to lower their prices.

econcon 6y ago

There is a really nice free app called "Discourse" for making forums but no such nice app for launching an e-commerce website with free plugins ecosystem. Is there a specific reason that free high quality forum software can be built but not e-commerce?

bishalb 6y ago
There's woocommerce/wordpress. You need not use paid plugins while starting out, the free ones should be sufficient. One might argue it's not "nice" enough but there are thousands of successful businesses built on top of it.
- econcon 6y ago
  If you go to /r/WooCommerce you'll see growing pains and that people are not happy in general with WooCommerce and plugin developers have to work extra hard to support ever changing WordPress. There is a need of stable (not frequently changing) e-commerce app that can be hosted and supports stripe/PayPal and "shipment tracking". WooCommerce requires yearly payment for shipment tracking. When discourse is available for free, there is no reason why WooCommerce alternative which can provide more out of box support can't be free. Today what options people have? WooCommerce, Shopify (SaaS) and legacy apps like Magento, Presto, Opencart. This is not enough - most e-commerce development happens on agencies selling their services. We can certainly provide more out of box features with help of open develop model.
  - bishalb 6y ago
    Which platform doesn't have issues? I am sure if you go check discourse's official forum, you will see it has its fair share of problems and shortcomings too. I just did a quick search and found that there is a plugin called advanced shipment tracking for woocommece which seems to be free and gets the job done(i am sure it has a paid version too but the free one seems to be good enough, judging from the reviews) Also e-commerce site owners are entrepreneurs and the primary goal of any e-commerce site is to make money. The primary goal of a discourse forum isnt making money. E-commerce owners are more likely to invest in tools that help them grow their business, unlike someone who runs a forum, where there might not be such a motivation.