Why iLogon has not succeeded…yet!

Notice that I did not say “Why iLogon failed”…because it hasn’t, and I still believe there is a great market for it. I could go through a long list of reasons of why it hasn’t hit yet, like how the economy has sucked since I launched iLogon, or how I wasn’t able to raise enough money, blah blah blah. But, it comes down to 2 specific things.

First, a brief overview of iLogon for anyone who doesn’t know what it is. (is that even possible??) iLogon is a platform for bundling web applications. Our initial focus is business apps, but eventually we’ll offer more consumer apps as well. So, if you are a Start-up or small business using an online CRM, Web Conferencing, Hosted Storage, etc, iLogon provides one site where you can find these apps, sign up for a discount, get setup on all sites with one registration process, then access them all in one place with a single account. That’s it, you use your web apps just like before, but we make it cheaper and easier.

Sounds great, right? Well it is! However, here are the 2 issues. First, we have a significant chicken and egg problem. You see, we have to sign up hundreds of partner applications to offer on the site. The problem is, to easily and quickly sign up these partners, they want to see a ton of users. The users? They want to see a bunch of web apps (partners) to choose from. Hence the chicken and egg problem.

The second issue? If you are familiar with any of the top product marketing and lean business practices, you know that you have to focus, pick a niche or vertical and devote all of your efforts to that market. I get this. I’ve studied and researched the hell out of these concepts. However, how do you focus on a niche when the value of your solution is offering a variety of options to your users? You don’t need a bundling solution for apps that are all in the same category. You only have one CRM! So, how do you get laser focused when your business model requires broad support for apps? My response has been to focus on a specific customer type. Start-ups and small business is my answer. Is that the right approach? The right target market? Time will tell, but getting to this point has been a challenge.

I guess I never mentioned how I intend to solve the first problem. I don’t think there is a silver bullet. (there never is…) But, I’ve been chipping away at both sides to try and reach a critical mass. This is slow and expensive! The other option I’ve entertained is to partner with sites and organizations that have the users and can benefit by providing iLogon with access to those users. Some success here, but still slow going.

So, this is as much an open forum for discussion as it is my assessment and update of the core challenges at iLogon.

Your thoughts?

Agile is not an excuse to throw out process and documentation

I’m a big fan of agile and lean development/organizations. I’m all in, completely. For the last 5+ years I’ve been practicing agile development, and now I would consider myself a full on scrum practitioner.

However, there are a few interesting things I’ve noticed over the years:

a) Many people say they are doing Scrum, but they have no clue — Having a daily stand up meeting does not mean you are doing Scrum

b) People either love or hate Scrum, there’s not much in between

c) Some dev shops are using Scrum as an excuse to throw our process and documentation — this is the key message of this post

In my experience, Scrum only works if you go all in. You can’t partially implement Scrum.. As I said earlier, you can’t institute a Daily Scrum and call it a day. Scrum means iterative development, production ready code every sprint, daily stand ups, product backlog, etc. When you fully implement the process, it works! When I was first exposed to agile, I had a hard time getting over the minimal documentation, and the misconception that there was little to no process. It took me a while to realize my first exposure was tainted by working with people who had no clue how agile and scrum actually work.

So, how much process and documentation do you need to effectively implement scrum?? The best answer? Enough! You need a product backlog. User stories work best for this, but use cases are also effective. Now, how about process? The typical agile stuff is very important. Daily scrum meeting, sprint planning, sprint review, product backlog, with a Scrum Master coordinating and removing roadblocks are critical to a successful scrum implementation. But, this doesn’t address the development (coding) specific process. Test driven development (TDD), continuous integration, and build automation are all necessary components as well.

So is this enough? I don’t know. You tell me. Like Curly said in City Slickers. The secret of life is that one thing, and you have to figure out what that one thing is. Yes, there are several key tenets of Scrum that you have to use to be successful, but you have to figure out how much process and documentation is enough, and only do that much, and not any more.

Is this too esoteric? Perhaps, but with the amount of info available on the web with a simple Google search, any competent dev team should be able to put a successful scrum framework in place, and churn out high quality software.

Developing a Hybrid SaaS Application

What’s the best way to develop a Hyrbid SaaS application? By Hybrid SaaS app I mean solutions where the primary functionality is hosted, but there is a local footprint required at the customer site. The first thing I would say is don’t do it! Don’t install anything at the customer location…ever. Cloud, SaaS, whatever you call it, is becoming more acceptable as a standard software delivery model. We can thank Salesforce.com for that. that’s how you should deliver software. However, then you make a good case for why there must be software installed on site, and I again say don’t do it. Investigate every possible option for moving this local functionality up to the cloud.

So after all of this, it becomes obvious there is no way to move 100% of the required functionality up to the cloud. You have to install software locally. Well, then start by minimizing the footprint. We’ve already established that there is an absolute requirement to have software installed on site, so install the bare minimum and nothing more. Design an architecture that provides a minimal on site footprint with everything else run as SaaS.

Key Design techniques:

- Minimize local footprint: Once you realize you need a local footprint, you may be tempted to add more functionality to the on site deployment. Don’t! Manage as much of your software as possible in one place, and under your control.

- Utilize webservices or other technologies that run over standard ports: Webservices by default run over port 80 or 443, which will be open on any customer network you are selling into. Take advantage of the existing configuration, and use these ports.

- Make it installable over the web: Whether you use an MSI or other installer program, or a virtual appliance, it should be downloaded and installed over the web by the customer. if you are selling a SaaS or Hybrid SaaS application, services should not be a requirement.

- Deliver as a “virtual appliance”: While appliances are a popular and attractive option to ease support and deployment, you are a software vendor and don’t want to support hardware. Convert your appliance image into a virtual, and deliver via VMWare .

- Secure all data in transit: use ssl for all webservice and/or web communications. You may also need to encrypt data stored in the cloud, which will increase transfer time.

If you follow these techniques, you’ll have a Hybrid Solution that scales well, is supportable, and will work reliably in any enterprise.

Poll: How many fee based websites do you subscribe to?

I’m compiling data on the average number of SaaS or other subscription based websites both businesses and consumers subscribe to. This includes anything from Salesforce.com on the business/enterprise end down to Wall Street Journal on the consumer side, and everything in between.

What type of web based applications are you willing to pay for? What is the value add or motivating factor that would make you pay for a web application?

My Interview with Startup Lucky

Last week I did an interview with Startup Lucky to promote iLogon. For those of you who don’t know who StartupLucky is, I highly recommend checking them out, especially if you are a startup founder / entrepreneur! They do web video interviews with startups, entrepreneurs, investors, and internet personalities. @aronado (Aronado Placencia for you non Twitter folks) started the site and also does the interviews. If you spend any time on Twitter, you probably know who he is. Aronado (yes, that’s his real name — I asked!) is a high energy guy and a lot of fun to talk to. I’m a big fan of his after following him on Twitter for about 6 months.

Anyway, I’m pretty happy with how the interview went and wanted to share it with my network. I’ve emailed the link to a number of people, and posting it here as well. Check it out and let me know what you think.

http://startuplucky.com/2009/04/28/ilogoncom-a-startup-that-manages-your-online-subscriptions/

iLogon Public Beta Launch

Finally!! After several delays and a lot of stress, we launched the beta release. We certainly have a lot more work to do, but we now have steady traffic on the site and users. My goal is to drive traffic to the site, which will lead to beta accounts, which will then translate to paying production users. The plan is in place, and things are looking good. We still need to sign up a bunch more partners, but that is also going well. We should easily hit our goal of 20 partners minimum for the production release. The goal for the end of the year is 50 partners, and this also looks very achievable.

Steps to sign up for iLogon Beta:

 

1)      Go to www.ilogon.com and click “Product Finder”

2)      Select the iLogon Account product and add to cart

3)      Select any additional services you want to add to your account

4)      Complete the checkout process (in the future this will automatically redirect you to the main page where your services are located)

5)      When you return to iLogon, enter your username/password, and you will be presented with the main page which shows the services you have access to

 

That’s all there is to it. Please email us any feedback or questions you have to beta@ilogon.com. We still have some work to do, but we’re excited about getting the beta release out there, and hearing what you think about iLogon.

Good news for iLogon, pay sites on the rise

While working on the business model for iLogon, I noticed an interesting trend developing on the web. Is Web 2.0 a repeat of the dot com crash? Once again we started seeing ridiculous valuations on companies that generate little or no revenue. The difference this time? Users are King. If you have a lot of users, and more specifically, a lot of key information about the users, you may have been sitting on a gold mine. Look at the valuations for Facebook, Linkedin, and MySpace. While constantly watching the VC activity throughout ’08 (preparing for my own funding campaign) I saw one “cool” or “sexy” Web 2.0 application after another get funded. The problem I saw was, cool and sexy is not a business model. Where was the revenue going to come from? Even Facebook, with their 120M users can’t sustain themselves on advertising alone. When you read between the lines, you realize pretty quickly that the plan is to go get a bunch of users and figure out how to monetize them later.

So this brings me to my earlier point. When I saw this developing over the last few years, it made me even more confident that the iLogon model was rock solid. While ’08 was not necessarily the best time to get funded if you didn’t have the next “me too” social network or freemium web app, it was a great time to bootstrap iLogon. And a funny thing happened on the way to the iLogon beta launch. The economy tanked, the stock market took a crap, and VCs closed their wallets. This lead to increased pressure to generate revenue for startups AND established companies, which in turn forced these companies to scrap the free model in many cases. Google and Jott Networks are 2 examples that stand out for me, but there are many more coming.

http://www.techcrunch.com/2009/01/23/google-puts-the-squeeze-on-free-apps/

http://www.techcrunch.com/2009/01/13/no-more-free-jott-for-you/

So, how exactly does this help iLogon? For those not familiar with the iLogon solution, it’s a web application for aggregating and managing online subscriptions, more specifically, fee based subscriptions. We’re signing up partners who offered fee based services at a steady pace, and are in the process of becoming a Google reseller. The iLogon app let’s users build a “package” of subscriptions sites, and provides single sign-on, consolidated billing, reviews and recommendations, and perhaps the best feature – gives the user a discount on the subscription fees. The more sites out there that are fee based, the better for iLogon, especially if the industry continues to move in that direction.

The bottom line? The web appears to be trending towards fee based content and services over free, and iLogon is positioned well to take advantage of this trend. We launch our beta release by the end of January, and will be in full production by the end of Q1. Perfect timing?

http://www.ilogon.com/default.aspx

iLogon Update

I recently sent an email to everyone who has contributed to or inquired about the status of iLogon since we started last summer. I thought I would post a copy of that email here to record our current status and get access to anyone who is interested. Many people have helped iLogon out in one way or another, and for that I am forever grateful! 2009 is shaping up to be a great year for iLogon, and I have very aggressive goals that I am confident we can achieve.

Below is an update on our status and plans for the year. For those who are interested, please read on and provide any feedback you may have. I’m always looking for advice, thoughts and ideas on the business. If you only had minimal interaction with iLogon or don’t even remember who we are (could that possibly be true?? I offer thanks for any help you have provided, and won’t take any more of your time.

-      We are launching our Beta Release later this month. By the end of Q1 we will start signing up production users and generating revenue.

- We have about 10 partners with signed contracts, and more coming in every week. We are well on our way to the goal of 100 by the end of ’09.

- We are finalizing a deal now with Merchants Information Solutions (Identity Theft Protection/Credit Monitoring) to include their basic monitoring service for free when users sign up for iLogon. This is a great deal for us and our customers and will contribute to our viral marketing campaign.

- We are closing a deal now to bring in a Chief Strategy Officer who will help us land some “big name” accounts we have targeted. I’ll provide more detail here later.

- Some of the key accounts we have signed up or are in progress of signing up include: ESPN, Rotowire, TrainingPeaks, Dimdim, Photobucket, Merchants Information Solutions, Wine Library, Box.net, Britannica, Zagat, Motley Fool, Wall Street Journal, and many others.

- Our Marketing Campaign has started, but will pick up in full force once we launch. This includes viral, word of mouth, traditional marketing, social media, and every available channel for getting the message out and acquiring users. We’re growing our presence on social media platforms, building relationships with bloggers and press, collecting beta users, and getting the word out, all in anticipation of the launch.

- Funding continues to be a challenge, but we have some good prospects, and continue to work hard on extending our runway. Between our early stage status and the state of the economy, it has been difficult to raise money. However, we have secured enough seed funding to bootstrap our way to launch. Hitting these key milestones gets us closer to revenue and funding, both of which will enable us to grow faster and hit our goals.

More thoughts on Startups

I’ve been thinking and writing a lot lately on the economy and how it is affecting startups. This is always on my mind. I’ve been pretty positive and bullish on how I think things will turn out. Last week, I attended the Arizona Entrepreneurship Conference, and was blown away by one presentation in particular. First off, the entire conference was great, but the best part by far was Gary Vaynerchuk. He is my new hero!!!

Here’s a link to a video of the presentation.

http://www.vimeo.com/groups/azec/videos/2293651

I haven’t watched it yet, so I don’t know how good the quality is, but I’m sure you’ll get the point. He is full of passion, humor, insight, knowledge, and just tells it like it is. It is rare that I am this affected by a speaker.

So this brings me to my point, though I may ramble and wander a bit in this post. There is never a good or bad time to launch a startup. The odds always suck, they are never in your favor. This was a point Gary made several times. If you have a great idea and great people, you have a good chance to be successful. If you don’t, you don’t!! It’s obvious and common sense, but you just don’t hear enough people say this.

As a Startup founder, I get a lot of advice and feedback. This is a good thing, and I welcome it all. However, if one more person tells me that I need traction to get funding, or that 80% or more of all startups fail, I’m gonna snap!! I think people must confuse humility and willingness to listen to all feedback as naivety or inexperience. I’m not sure, but I’m getting close to my boiling point. Look, I COMPLETELY understand the risks of a startup. 80-90% fail, of the companies who submit a business plan to an investor, only 1 in a 100 (or less) even get their plan read by a partner. The economy sucks now. It is hard to get funded before you have customers and revenue. YES, I get it. I knew this before I started. I knew this before I left my job of 8 years. I knew this before the economy went to shit. Maybe only 1 in 10 succeed. Maybe only 1 in 1,000 get funded w/o revenue and a fully launched product. But, the thing that is going to make me successful is that I fully believe I am that one! How can you succeed if you don’t believe that and work your ass off to make it happen?

So please, give me advice. Tell me what you don’t like about the business model. Be direct, I can take it. But don’t start quoting statistics and telling me how risky this is. If I hadn’t fully processed that information and done my risk analysis/contingency planning before starting my business, I’m an idiot and it won’t do any good anyway.

When are business and government going to live a “healthy lifestyle”?

I just read a comment on a story in Techcrunch that got me thinking about the current financial and business downturn we are in. (ok, it’s probably more of a disaster, but I’m trying to be positive).

Anyway, Web 2.0 Bubble commented as follows:

Layoff is a corporate version of “On Diet”. If you eat too much, you blow up. There are many unsustainable “me-too” 2.0 startups. Supply >> Demand. The marketplace cannot hold that many duplicates.

Here’s the full post with all comments:

http://www.techcrunch.com/2008/10/17/keeping-count-the-techcrunch-layoff-tracker/

Anyway, I’m not sure of Web 2.0 Bubble’s complete intent here, but allow me to give my take on this. I like this analogy. It makes perfect sense to me! I exercise regularly, eat right, take vitamins, etc. Therefore I am very healthy, don’t get sick often, and have few if any swings in my physical well being. We always hear that there is no such thing as a diet. You have to live a healthy lifestyle ALL the time. You can’t eat like a pig and starve yourself later. Not only is it unhealthy, but it creates a viscous circle of gain weight, lose weight, gain more back.

Hmm, do you see my analogy taking shape now? I think the current economy, the housing boom and bust, and the dot com bubble bursting are all based on this unhealthy lifestyle. You cannot overeat and practice unhealthy habbits without an eventual crash. It could be a heart attack or bankruptcy.

Companies that didn’t overspend, overhire, AND have a solid business plan should survive. They’ve been living a healthy lifestyle. Those that havent?? Well you can find many of them in the Techcrunch layoff tracker…