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"As we discussed earlier, even at $300 the product is too cheap. The sign should have likely been selling at $600 from the very beginning." Even at $600 - ther
by michaelt 4y ago
"As we discussed earlier, even at $300 the product is too cheap. The sign should have likely been selling at $600 from the very beginning."
Even at $600 - there's a screenshot saying the company had three engineers and a marketer.
If your 4 employees earn $25k per annum, with the $150 parts cost you'd have to sell 222 signs at $600. And if the employees were on $100k, that's 888 signs a year.
That's a heck of a lot of signs, at the price. And you'd have to keep hitting those sales targets so long as you wanted the API to stay up.
It would make much more sense if the business was a one-engineer passion project - someone who had a day job and did a few hours a week maintaining this as a side project would have much more achievable sales targets!
- gdilla 4y agoOr charge less and get a recurring fee for the API.
- michaelt 4y agoPerhaps, but still tough to make the business plan work for a $100k wage bill. 833 subscribers at $10/month? 8,333 subscribers at $1/month?
- gdilla 4y agodont invest in non-viable things. if you can't cover your expenses, it's not a viable business.
- brookst 4y agoThis. It is fatal to charge a one-time price for services that have perpetual operating expenses.
- deleted 4y ago[deleted]
- pdntspa 4y agoWhy does a project like this need three engineers? Two, I can kind of see (a hardware guy and a software guy, though it doesnt look like the hardware guy was doing much here), but three?
- dinosaurdynasty 4y agoPeople have to go on vacation sometimes
- pdntspa 4y agoSo you let the thing run and brief the other on what to do if SHTF. We're talking hundreds of units out in the field, not millions. Every aspect of that can be provisioned for ahead-of-time, and cheaply at that, and then the SWE can walk away for weeks at a time. If the HWE leaves for a bit, same thing. If he's making units production stops, but maybe the SWE can fill in since these dont look like difficult builds.
- jaclaz 4y ago>but three? The third one designed the wooden case and the manufacturing process for it ... /s
- hinkley 4y agoI wish I could get contracting houses on board with the notion that there are many tasks that require 30-50% of a person but greatly increase the quality of the work. I almost convinced some people at the last place but convincing the customers is something else entirely. Code reviews by more expensive staff for instance. Architectural reviews. Security audits. One engineer makes a mess because there is nobody to push back. Two engineers either fight or achieve full echo chamber. Three balances some power dynamics, but you definitely don't need 3 FTEs. In fact for this project you probably find 3 of your friends' friends to sit together for 4 hours twice a week and slam out some code or designs, in exchange for a little money and some equity. You even get to write off food and beer as a business expense.
- dom96 4y agoThis makes me wonder how Tidbyt's business is doing. They seem to have a fair amount of employees. I actually built something very similar and all in my spare time. I've been wondering how realistic making a side-business out of it is, but if you are a single engineer that has to code the firmware, server, build the displays and market it all... it's pretty tough (especially in your spare time).
- rohansingh 4y agoWe actually only have 4 FTE's today and our business is both sustainable and growing. Our scale is also a couple orders of magnitude larger than the numbers from the article, and we have much better control over our BOM. Hardware is a tough business and managing cash flow & inventory requires you to be a lot more deliberate than a pure SaaS business. Fortunately we had a lot of examples going in of how not to do things.
- wferrell 4y agoWhat a great reply. Thanks!
- walrus01 4y agoHave you considered making a larger version that is something like double the width, and would sell for approximately double (maybe $300?). I just took a look around the tidbyt website and it looks like a fairly well polished product. https://tidbyt.com/products/tidbyt https://tidbyt.com/products/tidbyt
- guiambros 4y agoGlad to hear! Happy Tidbyt user here. The device is incredibly well made, and love how you've been iterating. Wish the company all the success!