Founder of Threadless keepin’ it real

June 7, 2010 in An interview

This interview with Jake Nickell is a joy to watch. And an inspiration. He’s the founder (and subsequent millionaire) of the ingenious Tune in to hear great marketing ideas and other inside scoop. It should get your wheels turning. After watching the below intro, click through to view the various parts, it’s about an hour.

Watch live video from Inc. Magazine on

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Shopify featured (briefly) on 37signal's "profitable and proud" series

June 3, 2010 in A blog post, An interview

Over on the 37signals blog they've started a "Profitable and Proud" series where they highlight companies who've bootstrapped to profitability with revenues over $1mil. They started last week with a WH favoriteCampaign Monitor, then today (before revoking the "P&P" status) they profiled Shopify (another fav). 

Here are the gems I found from today's interview:

This comment surprised and intrigued me:

Our hiring is based on the assumption that there are fundamentally two groups of people in the tech industry: there are left brained science type programmers who can write amazing amounts of complicated code with ease; and then there are the right brained creative types. While left brained programmers may be 2-3x as fast when writing code, the right brained programmers can use their creativity to come up with elegant solutions that only require 1/5th of the work. Based on this understanding, we hire the creative types.

And this struck me as a great litmus test for new offerings/features:

When you build your product ask yourself “What do most of your customers need most of the time?” We test any idea we have against this simple sentence and if it doesn’t check out we don’t add it to Shopify.

I really look forward to more from this series.

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Interview with Guy Kawasaki

April 29, 2008 in An interview

Guyk Guy Kawasaki's "no-bull-shiitake" wisdom and style makes him an endearing and inspiring figure. He is best known to entrepreneurs for his writing and speaking. (His excellent Art of the Start is required reading for all WorkHappy readers.)

He also runs Garage Technology Ventures, an early-stage venture capital firm. A couple years ago he started his own blog and posted a flurry of excellent posts that pulled his blog into A-list status in a hurry. Then lately he has started a couple ventures of his own. Last year came Truemors, and this year, AllTop. was included on the AllTop directory for startups, and since I had his attention, I asked him to spare a few minutes for some questions. Here they are:

1. So you busted Steve Ballmer's chops pretty hard. It made a ridiculously entertaining and enlightening interview, did he thank you afterward?

He did, as a matter of fact. Other than throwing my Macbook Air on the ground, he was rather gracious. Time Magazine had me write a profile of him, so I’m going to get the last shot.

2. You've obviously built a very successful entrepreneurial career of your own, including authoring books, and speaking.  But your first claim to fame is having worked for Apple, how did you go from an Apple employee to a Venture Capitalist?

After my first tour of duty at Apple I started a Macintosh database company. Then I became a writer and speaker and then started another Macintosh software company. After that, I returned to Apple as an Apple fellow. Finally, after that, I started which became the early-stage venture capital firm called Garage Technology Ventures.

3. So with all the advice you've given on pitching VCs, have you seen an improvement in the quality of pitches to Garage Technology Ventures?

Honestly, they’re not that much better. They are still too long, still using meaningless buzz words like “revolutionary,” and still don’t have credible business models. If only they would adhere to the 10/20/30 rule of Powerpoint: Ten slides, twenty minutes, 30 point font.

4. What concepts are you tired of seeing?

A fill-in-the-blank version of Facebook. That is, Facebook for guinea pig owners, Facebook for senior citizens, Facebook for Loch Ness monster believers. I’m getting anti-social in my later years.

5. When being pitched, what marketing approach most impresses you?

A product that is so compelling that adoption is close to involuntary. It hardly ever happens, though.

6. What are the most popular excuses you see for people who just can't get going on their venture?

They are working on their business plan. VCs fund people or products or services. They don’t fund “plans.” Step one for entrepreneurs is to build a prototype. That’s what truly counts.

7. You've been launching some new Internet ventures of your own lately (Truemors and AllTop), how closely have been able to follow your own advice from Art of the Start? (e.g. What meaning does Truemors make? What's Alltop's business model?)

I try to follow what my book says—at least until I figure out that my books is wrong. Truemors makes the meaning of democratizing information. Alltop’s business model is to attract people interested in narrow topics like food, wine, economics, China, India, and moms and then to sell ads to these self-selected audiences.

8. If AllTop and Truemors didn't have the buzzworthy name of Guy Kawasaki attached to them, what would you do differently to market them?

Not much. A buzzworthy name can only go so far. At an early point, the product is either good or not. It would be harder for someone without my visibility to market either Truemors or Alltop. On the other hand, more is expected of me, so judgment is harsher. Such is life.

9. Who makes the decision about where a site appears in the AllTop order of things?

Most of the time, it’s me. It’s subjective based on factors like the credibility a feed adds to our topic, the quality of the content, and how much we like the person.

10. Many of us at WorkHappy will read anything you write. Is there an author about whom you feel that way?

You flatter me way too much. I will read anything Tom Clancy, David Baldacci, and one other whose name I cannot remember right now. He always writes about snipers. As you can tell, I’m not a cerebral reader.

11. Are you done writing books?

Nope, I have a new book coming out in October. It’s called Reality Check. It contains the best of my blog and latest writing from the past three years.

12. You and John Ondrasik are the only guys I know of who like ice hockey (or at least admit to it). What are the rest of us missing?

Ice hockey is a beautiful sport. It combines physics, ballet, chess, and hand-to-hand combat. It’s hard to learn, and it’s hard to master. It is the only thing that I am not good at that I love.

Thanks Guy!

See also:

Did you know Authentic Jobs now has an affiliate program? Sign up and earn $75 per referral.

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Interview with Aaron Patzer, founder of

February 19, 2008 in An interview

I first started paying attention to Mint when my brother, a dirt-poor college student sent me an arm-flapping, breathless, urgent email telling me how he'd signed up at and that it found a $9 per month charge from an obscure company. Mint had flagged it to his attention. It turned out to be a scam. After a struggle with the scammers my brother got a $328 refund, and a stop to the bleeding. He had spent five minutes with Not a bad ROI.

Aaronpatzerheadshot Aaron Patzer started Mint when he was just 25. One of those freakishly-smart guys, he started playing around with computers when he was six years old, ran a BBS when he was 10, and started his first web development business when he was 16. Which was in 1996.

He attended Duke University earning undergrad degrees in computer science, and electrical engineering, and computer engineering. He then started a Ph.D. thinking that was a requirement of any good inventor. He found that to be "thoroughly impractical" and instead earned his MSEE from Princeton University.

What followed was work for IBM working on the Cell microprocessor (used in the Playstation 3, and it has three of his patents on it) then for a startup, Nascentric where he learned how to build a company from scratch.

During this time Aaron was working 70-80 hours a week, and neglecting his finances. After a disappointing experience with Microsoft Money, and Intuit's Quicken he figured there had to be an easier, quicker, and more automated way to organize his finances.


The company that would become Mint was born.

In mid 2007 he emerged from stealth mode and launched at the Techcrunch40 conference on September 18, 2007. Among 700 startups, narrowed to 40, Mint went on to win the event.

In its first month, Mint signed up 50,000 users.

By the end of the year, it had passed the 100,000 user mark.

My interview with Aaron:

1. What did the first few months look like?

I got this idea in my head that I really don’t want to put so much work into my finances anymore – I want to make the whole process effortless and automated.  I began to think about the business nights and weekends.  But it’s hard to find the time when you’ve got a full-time (and very demanding job).  One day I said to myself: “If I give it 100% and fail, I can live with that.  But I can’t live with going half-way, part-time.”  So on March 1, [2006] I quit my job and began working on Mint.  The first few months were tough. I was 25 at the time, and basically oscillated day to day between thinking "This is the greatest idea ever!" and "This will never work.  Who am I to take on Intuit and Microsoft?  If this was a good idea, someone would have done it before." It’s very emotional, and I don’t think people ever tell you about that.  You see your net worth quickly draining, you have no idea what’s going to happen next, and you’re sitting alone in a room with no help, no resources, just your brain and sheer will-power.  When ever I got down, I would listen to "That’s Life" by Frank Sinatra, or think about a Shakespeare quote I liked as a kid: "Our doubts are traitors, and make us lose the good we might oft win, by fearing to attempt."

Remember at the time, I had not done web development in 8 years.  I knew nothing about Java web services, little about databases, little about management, and only some on recruiting and building a company.  But I was really good at one thing: algorithms.  And I’m really persistent – I worked 14 hours a day, 6.5 days a week for 6 months straight before we had any funding.  I was new to Silicon Valley, and really didn’t know any other engineers or people who could help, so I did most of our pre-alpha or prototype release myself.

2. Mint represents a neat idea, with a pretty absurdly bold requirement - having people punch their financial login credentials into an unknown site - how did you sell this idea to investors, and how were you so sure it would fly?

Regarding security, keep in mind has a read-only connection to your bank account, so you can’t actually move money around and no one can drain your accounts.  We also have bank-level data security, along with low-balance and unusual spending alerts to help you proactively identify fraud or identity theft.

That said, pretty much every investor I went to said we would fail for exactly the reasons you outlined:  no one is going to trust an unknown startup with their financial information.  It turned out not to be true at all.  In our first four months, over 100,000 people have entered their financial information into, and we’ve had no security breaches at all.

Trust is a complex thing.  There are some people you will never convince, and who to this day won’t buy anything online.  A few things really help.  One is the domain name. is quality, it’s a place where money is made, it’s short and spelled unambiguously.  It’s a very good brand name for what we’re doing.  We spent three months, hundreds of hours, and more money than I care to comment on for that domain – but it was worth it.  Offhand, who do you trust more: or  (I made that name up, but it shocks me how little most Web 2.0 companies pay attention to their name – they misspell, have long/cheap domain names, and lose trust because of it).

The other big factor in building trust quickly is site design quality. has one of the best graphic designers ever (Jason Putorti) – he cares about every pixel, all the fonts, all the transparencies and effects.  And that shows instantly.  People do make judgments of trust on appearance – in the real world and online.  The last thing is you really need to back it up!  My third hire at was our VP of Engineering, David Michaels, who has 15 years of experience in security, including financial web services.  We also have outside security consulting from the guys who invented SSL, and use “white-knight” hackers who try to penetrate your system and identify vulnerabilities.

3. Did you have the revenue model (of providing money-saving/money-earning offers to users) in mind from the start?

Actually I did.  Mint’s revenue model has been in place since the very beginning: search the web for better prices on the things we see you buy most, ensure you have the highest yield on your checking and savings accounts, and maximize your credit card rewards while minimizing finance charges.  I think that’s rare for most startups, but the idea at the core of Mint – help people understand and do more with their money – has not fundamentally changed.

4. You're a pretty young guy, and now you've got significant investment, significant expectations, and significant growth all pressing in on you. Seems like a good problem to have, is it everything you'd hoped?

I’m 27 now.  It is everything I’d hoped for; though nothing can really prepare you for a position like this.  What started out 24 months ago as one guy in a room coding away is a company of 18 with millions in funding and hundreds of thousands of users.  My decisions now affect many lives in a very profound way.  I consider that an honor and a privilege, and I take it very seriously.

5. How does your growth compare to your expectations when you launched?

When we launched towards the end of September, my goal was 50,000 users by years end.  Instead, we hit 100,000 and have been accelerating ever since.

6. What has been your most successful marketing effort?

In terms of traffic, winning TechCrunch 40 out of 700 startups gave us a huge traffic spike and blog buzz that lasted for a month.  Arguably, it was the most important 7 minutes of my life.  And I’ve got to tell you, I was nervous: I had never spoken in front of 500 people before.

Prior to launch, one thing we did to build buzz was start a very active blog with over 200 articles on personal finance.  In order to get into the private beta first, you had to put up a little badge on your blog or social network page that said “I want Mint!”.  That gave us lots of free advertising, and a bunch of inbound links which improved our ranking in Google – not only was it free, it made those customers feel special when we let them in early.

7. What's your secret to time management? Any methods/tools/approaches you can share?

Really I just work flat out as long and as hard as I can.  I don’t have any rules like “only answer emails twice a day” or anything.  The most important thing I can tell you is to set aside an hour or two each week to sit alone in a room with no distractions and just think.  Think about your business and your product.  Hard thinking is something most people avoid, and it’s actually very easy to avoid – there are always other things to do (like press, answering emails, communicating to your team, etc.).  Sit alone in a room and just think.

8. Can you share some of your favorite sources of inspiration and ideas?

In real life, my hero is Thomas Edison. He was a great inventor, but also an outstanding entrepreneur.  He didn’t just develop the light bulb; he invented the entire electric grid and power distribution system.  General Electric (GE), one of the world’s largest and most profitable companies, still stands today as his legacy. In fiction, my hero’s are Howard Roark in Ayn Rand’s The Fountainhead – he’s actually the person I most identify with – along with the characters in Atlas Shrugged, and Henry Bannon in Calumet K.

9. Any parting advice for other aspiring entrepreneurs hoping to take over the world with a big idea?

The most important part of any business, product, or invention is that it must solve a real need and a real problem.  Observe the world around you – everything you do, and especially everything you hate to do – solve a real problem and the world is yours.

Huge thanks to Aaron for sharing his time and experience.

Full text of interview.

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Interview with Founder of - A Preview

February 14, 2008 in An interview

Next week I'll be posting an interview I did with Aaron Patzer, founder of To whet your appetite, here's a (very killer) preview:

The first few months were tough. I was 25 at the time, and basically oscillated day to day between thinking "This is the greatest idea ever!" and "This will never work. Who am I to take on Intuit and Microsoft? If this was a good idea, someone would have done it before." It’s very emotional, and I don’t think people ever tell you about that. You see your net worth quickly draining, you have no idea what’s going to happen next, and you’re sitting alone in a room with no help, no resources, just your brain and sheer will-power. When ever I got down, I would listen to "That’s Life" by Frank Sinatra, or think about a Shakespeare quote I liked as a kid: "Our doubts are traitors, and make us lose the good we might oft win, by fearing to attempt."

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Happy Quote?

September 11, 2007 in An interview, Happy Quotes

"I feel badly for these people who have forced themselves to become Don Quixote; who are embracing a project that can never go anywhere. Because if you're working on something that can never go anywhere, you don't have to worry about it ever going anywhere.

That weird uncle who's always got some board game he's dreaming up is safe. His board game is never going to get bought by Mattel. His board game is never going to change his life. He can live under the illusion that he's challenging the status quo, when in fact he is hiding."

Seth Godin (from this unlike-any-other interview of him)

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Interview with Michael McDerment, President and CEO of Freshbooks

October 2, 2006 in An interview

Mike Freshbooks (an online billing service company) recently announced that they have more than 80,000 users. Not a shabby accomplishment for a "web 2.0" company with an active and working revenue model. CEO Mike McDermont agreed to share some insights with us about their success.

1. So Mike - tell us a little about how you got started. What prompted you to start Freshbooks?

Carson, I think my story is not unlike many other web 2.0 start-ups in that it all started with my web design and internet marketing consulting business called Anicon. One big difference from many others is that we were around before this whole Web 2.0 phenomenon started (our service was released to the public in early 2004, around the same time as Basecamp, but that’s a little known fact). 

Freshbooks_1I started doing consulting gigs in 1999, and after a few years struggling to keep up with my invoicing I desperately needed something better to manage my receivables.  I hacked something up online for myself and to show my clients that this could be done online and that we were "eating our own cookie".  After showing it to my co-founder (Joe Sawada), he asked it he “could play with it”.  Shortly thereafter Joe started coding and the two of us working part-time managed to get the first edition of FreshBooks up and available to the public as a web based online invoicing service.  The rest shall we say, is history...

2. You recently announced that FreshBooks crossed the 80,000 subscriber line. Congratulations! You're facing more and more competition as the web 2.0 mania gains steam, what do you feel has been the strongest factor in helping you achieve your growth?

Thank you for the props, we are very proud of our growth to date. The biggest factors in achieving our growth has been word of mouth, organic search, blogging and spending in strategic online advertising. This has been limited to banners on targeted sites and newsletters and well as Google and Yahoo pay-per-click.  From very early on, we made a decision to have a budget available for spending on online marketing.  We have had varying degrees of success, but even when the conversion results were low, we took solace in the fact that at the very least our brand was gaining awareness. 

For those of you out there who are thinking about launching a web app, blogs and word of mouth are a great way to generate buzz, but I strongly recommend building visibility with some targeted marketed spends… trying to reach people who have not heard of “Web 2.0”, but who do know they want to save time invoicing… there are many more people like that out there than there are people tracking Web 2.0 and I think it can be easy to overlook that fact.

3. You've also done a smart job of marketing using your blog and other outreach like your current free tele-seminar series - how well do those work at bringing you new business?

To be determined!  Blogging at FreshBooks is something we only got serious about this spring, and we have seen a lot of positive impact from it (readership growth, and increasing number of comments).  I love blogging though because it lets us give back to and add value for our users. 

Giving back to entrepreneurs is a core value for our business.  We have a policy in place where we direct 1% of our profits to support entrepreneurs in the third world.  Giving back is also why we are doing things like the “Build Your Business Fall Tele-seminar Series” where we have invited experts with knowledge that web professionals need (as they make up the majority of our users). Topics like advice on Pay-Per-Click advertising and getting the most out of web analytics are topics that are relevant to many web professionals.  In many cases this knowledge is not only useful for our clients and their business, but also to their customers’ businesses.  We really want to see other businesses succeed.  That is one of our core aspirations and we help anyway we can. 

4. What advertising or marketing efforts have been less successful than you anticipated?

Last year we embarked on a PR campaign with a well established technology PR firm here in Toronto.  Although we learned a great deal from the experience (I like to say Levi and I earned our Masters Degrees in Communications), and it really helped us focus and strengthen the message we want to portray, we were certainly not ecstatic with the results.

5. What can you tell us about the technology behind FreshBooks, how did you build it? What approaches/philosophies drove/drive your development?

Our product has been developed very organically over a number of years.  From day one, our user community was given the chance to use it for free (although we also had paying users shortly after releasing) and we had a very open feedback loop for everyone to provide their ideas and comments on the product. 

The technology we are using is Linux, PhP, MySQL.  We chose this technology early on because it is open-source, and it has a good reputation for performance, stability and ease of use.  For example, Flickr is built using the same technology. 

On a side note, last year after seeing a lot of new and exciting products pop-up, we almost decided to re-architect FreshBooks using new technology like Ruby on Rails.   As it turns out I am glad we decided against this because it would have been a mistake for us.

6. Are there any mistakes you've made that we can learn from?

One mistake we can share with you is our approach to a referral program.  We put a lot of design and development resources into building a referral program right into our product.  Our mistake was that we miscalculated what those people who use our product would want as a referral incentive. We thought by offering cash incentives (25% of the fees your refer) people would want to refer our service and we could also attract professional affiliates that were strictly interested in making money referring FreshBooks. 

What we have since learned is that our customers don’t care about the money – they just want to refer us because they love the service.  And the professional affiliates are either far fewer than initially thought, or not interested in referring a service like ours where each referral had a relatively small monthly value to them. 

In hindsight we should have designed a program that gave our real users (not professional affiliates) the ability to tell their friends about FreshBooks and get a simple reward for it, such as a month of FreshBooks for free.  That is not to say our affiliate program was a waste of time, because we actually get a lot of value out of it as we use it to track our marketing indicatives these days.  But I think that if we were to do it again, we would focus on giving our users a break on their fees if they refer us to a new paying customer.  Right now we give people the choice.  By default we send them money, but before we cut a cheque we send them a note and see if they’d prefer to get a discount on their fees and that is what most people choose.

Another obvious mistake was our brand name.  You may or may not know that our product used to be called 2ndSite.  Now, at the time we chose the name, it seemed very cool, and with our initial intentions of the product, to be a second website for a small business kind of like their own intranet, it was fairly well named.  However, right away we struggled getting a for the name and quickly realized there were far too many ways to spell 2ndSite (secondsite, 2ndsight, secondsight, ...).  As much as our original branding was a mistake, the decision to re-brand and the way we went about it (check out was a big win for our business.

7. What pithy advice can you give other aspiring web-software-as-a-service moguls about getting their offering up and going?

  • Build What You Know – for authors it is often said that to be successful with your first novel you should “write what you know”.  When building a business, the same rule applies.  Build something you already have an intimate understanding of.  Solve a problem you already have and “scratch your own itch”…it makes decision making much easier. 
  • Observe the Holy Trinity (of Web Services that is) – product support, development and marketing are all interrelated with web services…they feed one another.  Be sure to include a good feedback loop in your product so your users can tell you what they want.  Build what your users want and they will market you through word of mouth.  At some point you may choose to develop a feature you believe has a significant “vision” behind it like we did with our ground mail service …then selling that vision will become part of your marketing and in this scenario your marketing drives your development.  You get the idea.  Support.  Development.  Marketing.  The holy trinity of web services.
  • Collect Advisors - we have a great set of advisors with extensive expertise and experience, and we are always on the look out for the “next one” to further round out our resources.
  • Finesse Your Pricing – getting your pricing right is vital to your success and to ensuring you promote uptake and don’t leave money on the table.  Don’t be afraid to rejig it over time.  We are on our third pricing model and we have increased our rates every time and each time we do more people sign up and pay more.  Here are two articles (one, two) with more of my thoughts on pricing.
  • Invest Your Time in the Design of Your Product - in this age, design and usability really do matter - don't let the ugliness of fool you.
  • Don't be afraid to Make the Leap of Faith - if you are building your product part-time, there will come a day when you think about dedicating someone on your project full time.  Make the leap and do it.
  • Get Some Love Money if You Can - don't squander it on overhead, find a relatively inexpensive office to operate out of, and spend the money on salaries and marketing exclusively if you can.
  • Search Out Government Grants and Funding for R&D - they are out there.  Find them.  Get them.
  • Expect to Have to Pay for your Paying Users, but not Your PR - don't expect a blog or great website to carry you through.  Yes there have been success stories, but the reality is they are few and far between and that is what the Web 2.0 hype tends to leave out of the story.  The blogosphere is a great place to generate buzz and get free PR, but most of your potential customers are not tracking web 2.0 – believe me.  So, find a marketing mix that works for you. Even if it’s only a $1,000 per month, spend it somewhere smart and closely track the results.
  • Measure Everything – read this article for some tips on how to track your success.
  • Think big (…in terms of your Market) - go after a big consumer market if you can. Our market is big, but the amount of people who need our service is actually a very small percentage of all potential consumers out there.  Think about it.  Everyone is a consumer, but only a small percentage of people actually own and operate a business.  A smaller percentage of those are the very small businesses FreshBooks serves.  With a consumer facing service…adoption will be even bigger and faster, like Flickr or FaceBook.  That said, everyone is talking about serving a niche these days.  That is what we have done and it’s a good strategy too.

8.  As a successful entrepreneur and businessman, you have many important demands on your time, yet you still manage to get stuff done. What's your secret to time management? What methods/tools do you employ to manage your time well?

Thank you Carson.  I’ll tell you sometimes I feel like I’m treading water, but you just have to push through those times. I can recommend a few things. First of all, don’t burn the candle at both ends.  We work a very regular day about here.  Granted I usually go from about 8:00 AM till about 7:00 PM, but I almost never work a day that is longer and we never (well did once) work on weekends.

Another big thing I think helps my time management is knowing what I do and don't do well, admitting it and passing it off to others.  For example, writing...often I spend too much time on writing assignments, generating documents etc. Whenever possible I pass those tasks on to Levi, he writes really well and he is much more efficient at it than I am. 

Another important thing I do is I constantly decide what not to do.  I spend a lot of time deciding what not to do because not all opportunities are equal - and we have passed on some biggies.  By passing on opportunities (about 80% of those that come up I’d say) we have remained focused and we have been able to free up the time we need to do the other 20% of activities that are worthwhile pursuing (like writing this interview :) ).

9. Are there any books/magazine/blogs that inspire you that you would recommend?

Here’s a great reading list (not unlike yours Carson!):

Thanks Mike, I really appreciate your time and willingness to share.

Mike has agreed to answer any questions you may have, in the comments to this thread.

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September 6, 2006 in 3 out of 5 stars, A person, An interview

What is it?

nPost: Another great resource for entrepreneurs, a collection of interviews with CEOs and Founders of small and startup businesses.


Who makes it?

Nathan Kaiser

Why is it the killerest?

Kaiser has collected almost 150 intelligently conducted interviews, including some favorites of mine like Jimmy Wales of Wikipedia (how awesome is he?) and Joe Kraus of Jot Spot. Clean site, searchable, or list them all.

What could be improved?

It appears that he records these, might be nice to have the audio versions as well.

The search is a bit iffy.

How much does it cost?



Reviewed by Carson McComas

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Interview with Megan Ducket of Sew What? Inc.

July 27, 2006 in An interview

Sew_what_logoMegan_1 Megan Ducket is owner and founder of Sew What? a custom theatrical drape maker (no, seriously, read on). Megan started out tiny, working and sewing at her kitchen table. Today she has 33 employees making backdrops for the likes of Maroon 5, Slip Knot, Green Day, Avril Lavigne, Prince, Sting, Elton John, and Madonna. Plus red velvet curtains for the cover of Rolling Stone and even stage curtains for elementary schools. Last month, Dell and the National Federation of Independent Business (NFIB) awarded her their annual Small-Business Excellence Award. Megan has graciously agreed to share some of her entrepreneurial journey with us.

Read on for insights on how to build a successful business dominating a tiny niche.


1) Megan, tell us a little about how you got started.

Admittedly my interest and abilities as a seamstress came as a bit of a surprise to me. I began by accepting the challenge of some theatrical “prop” projects as night and weekend work. Although I am the craft oriented type, I never thought it was a calling of mine. I actually had taken an apprenticeship in Australia as a theatre lighting technician!

So there I was, on the kitchen table, sewing unique items for special events and movie premieres. The more unique the piece, the more I was challenged by customers! I recall when the projects became too big for the table and I moved onto the floor in the garage – even spilling out onto the driveway at times. My husband and I both worked full time for a Rock and Roll staging company named All Access, so as you can imagine, adding the sewing hours by night definitely kept me busy.

When tax time came in 1997, the realization that I had nearly matched my day job income with the income from my night work inspired a decision to quit my day job and rent an 800 square foot unit at the local airport. After the initial investment of the warehouse and one sewing machine, I was able to sustain a self-funding business such that the profits covered all growth and expenses.


2) You've made a name for yourself in some pretty high profile markets, to what do you attribute your continued success with this crowd?

I try never to assume that any client’s business is a given. By trying to always present services and products as if each contact is our first opportunity to make a good impression, we have pushed ourselves to pursue excellence. We are creative, and passionate about what we do, and that is clear when speaking with any of us on the telephone, or reading any page on the website for that matter. I hope that Sew What? Inc will become a household name in the high profile markets for creativity, flexibility, passion and product. Our continued success will rely on providing these factors to each customer again and again.

3) The high profile customers surely bring buzz, but what portion of your business are the less glamorous customers. e.g. the schools, community theatres, trade show booths, etc? How important are they to your success as a business?

We respect the business we receive from all customers – both big and small. Some of our most rewarding projects are for small churches or under-funded schools, where we are able to help them by creative manufacturing and cost saving suggestions. It is exciting to hear from the congregation or students that the stage drapes and theatre supplies we provided have had a positive effect. This type of customer currently accounts for around 50% of our business.


4) I notice one of your titles (besides President) is Marketing Manager. Can you share a bit of your marketing philosophy with us?

Well let me warn you Carson – when I get to talking about marketing and branding I can go on for hours! In the beginning, marketing is not an area that interested me, so during the first four years or so, I made no efforts to market the company. I was guilty of the small business owner trap, by thinking: “I’m busy without it – why bother?” Not until I lost a large bid in 2002 due to a “lack of credibility” did I realize the importance of branding and the business credibility built by sharp marketing.

Realizing that the “clip art” letterhead was not going to cut it anymore, I decided to seek assistance – not simply with a new logo and stationery – I needed to create a brand. I found (and connected with) Star Marketing by way of a referral. Owner Chris Sandberg and his talented team have become an extension of our business and a part of my day to day. Chris’ team really “got” what we were about – so much so that when I read the branding strategy they penned for us, I felt very emotional. I found myself thinking: “Finally, someone who understands me and what I am doing here!” Most small businesses are “niche” in one way of another. Our challenge is that we offer theatrical draperies and exhibit supplies to a broad range of customers. While a theatre may want to order a backdrop or stage drape, they have no interest in exhibit supplies or pipe and base. What immediately connected me to Star Marketing was their ability to understand these different markets and help me develop a plan that brings it all together – web, print advertising (coming soon), PR, and so on.

Sewwhat3The power of the web is incredible. Our website has been designed and redesigned – three times in fact. Don’t settle for second best. If you can make something better, then look for a way to achieve it sensibly. Once your site is built, the secret is to optimize it to get the full benefit of traffic. I contract with Cindy McMahan of Search Marketing Pros, who is top in her class. Cindy has helped us reach both national and global clients.

My marketing philosophy is as follows: Position carefully, maintain a customer-centric focus, develop a brand that speaks for who you are (not what you think the client base wants you to be), let your passion for your product show in every piece of literature, correspondence and advertisement. Last but not least – be brave!

5) What marketing efforts have you attempted which turned out to be stinkers?

So far I haven’t suffered too many blunders, but I will say that there have been some monies spent unwisely at times. I am a stickler for quantifying results, so I usually catch the problem / lack of results sooner rather than later.

There were the discount coupons I distributed without an expiration date – that wasn’t cool. Also some monies wasted on printing unpolished and brandless literature – that was not very wise. I am very careful now to really assess the expenditure before signing the check. The several dozen business and marketing books in my collection help as well, and gathering opinions from others to consider when making my decisions is extremely helpful.


6) As a successful entrepreneur and businesswoman, you have many important demands on your time, yet you still manage to accomplish much. What's your secret to time management?

Time management can be a struggle. I am extremely regimented when it comes to completing tasks in a timely manner – I don’t allow projects to linger. I try to keep some sort of schedule at work in terms of time committed to certain tasks. For example email correspondence in the morning, sales calls and customer service throughout the day, marketing tasks for at least 1.5 hours in the afternoon. I stay late if necessary or log into the system from home to finish up work after putting our 3 year old son to bed.

One of the greatest lessons for time management I learned (at a women’s business convention) is to get help in the home. Since hiring a college student to assist with household tasks three mornings a week, I am now able to focus home time on family rather than chores. This has been life changing.

7) What inspires you?

I believe there are benefits to surrounding yourself with the types of people you admire and those you want to learn from. I find myself greatly inspired by people. I attribute the success of the business in part to the mentorship of other business owners whom I greatly admire and respect.

I am also inspired by those characters that I may not have met, such as Michael Dell for example. His is a story that is truly inspirational. I learned much from the story of his business, which is shared in his book. It will be a tremendous honor to actually meet him in September as a result of winning the NFIB/Dell Small Business Excellence Award for 2006. I would encourage other small business entrepreneurs to participate in this award program that is so generously sponsored by Dell and the National Federation Of Independent Business.

8) Any parting advice for other aspiring entrepreneurs hoping to take their niche by storm the way you have?

I am a firm believer that many types of business can be grown incrementally. (Granted – not all, and so I speak only from my personal experience) Take your vision and break it into the smallest and lowest common denominators. With your final goal in mind, you can choose wisely where to start and how to spend you money. Surround yourself with those whom you admire, always do your own research, and only risk what you are willing to lose. True passion will soon bubble to the surface and you will be able to build a strong and successful business from the ground up.

Just remember there will be bumps in the road and doors that close, so be prepared with a thick skin and a determination to get up and try again. Persistence, self-education (learning from your mistakes) and determination are keys to success.

Thanks Megan for sharing your ideas and inspiration. We wish you continued success.


Interview with Scott Lake of Shopify

July 5, 2006 in An interview

Shopifylogo I followed some of the pre-launch buzz behind Shopify and everything I saw led me to believe these guys were doing it right. There's such a tremendous need for well done, simple, affordable, clean ecommerce solutions for small businesses. Yahoo stores and a few other players have tried to make this work - but no one that I've seen really seemed to "get it" from a functionality, pricing or usability standpoint, and none of the players is at the level that innovative web development is today. Well, Shopify finally launched a few weeks ago and it looks to me like they're delivering on the hype. It was my privilege to shoot a few questions at Scott Lake, co-founder of Jaded Pixel, the company behind Shopify.

1. Hi Scott, first - please tell us a bit about Shopify and what you are trying to accomplish with it.

Shopify is a simplified e-commerce platform that is designed to remove all the common barriers that small businesses, micro-enterprises and individuals face when trying to sell online. These barriers include hassles such as setting up hosting, integrating with credit card gateways, learning about security, SSL and the high cost of some e-commerce software.

Jadedpixellogo 2. How did you get started? You founded Jaded Pixel with a bunch of smart geeks. Did you guys start as a web development firm and evolve to Shopify, or was creating Shopify your project from day one?

Shopify actually evolved out of an online snowboard store that Tobi Lütke and I started a couple of years ago. We both knew that we wanted to run a company together but hadn't yet decided what it would be. Eventually we decided that we wanted to open a high-end online snowboard shop. We are both snowboarders and it seemed like something fun since we both were also interested in e-commerce.

To get things started, we looked long and hard at all the hosted, open source and commercial shopping carts that were out there and found that everything was either too over-featured or over-complicated for what we wanted to do. So when we sat down to talk it over, Tobi suggested that he build his own e-commerce app based on the then brand-new development platform called Ruby on Rails. Tobi is an amazing developer so I was all for it.

The result was and we sold about 40 snowboards that season. After the winter season slowed down, Tobi and I realized that there was a more obvious opportunity in providing an easy platform for creating e-commerce sites. Thus Shopify was born.

3. How have you funded Shopify? Can you tell us a little about how that process worked and what that looks like now?

We were lucky to have a very supportive network of friends and family when it came to financing Shopify. We raised a small seed round and have bootstrapped the whole thing ever since. We've kept our overhead is very low so we can go quite a while without having to worry about money. That being said, we are just beginning to think about taking an additional investment into Shopify.  So we will have to wait and see what happens on that front.

4. You were originally slated (at one point) to launch Shopify in Fall 2005. It took till June 2006. Looking back, what caused your delay, and how do you feel about it?

I don't feel that bad about the delay of Shopify. It was unfortunate that people had to wait for it but the reason for the delay had more to do with an evolving strategy then it did with underestimating the development time for Shopify. By this, I mean during the development of Shopify we decided to develop and release several other open source applications that could be used in conjunction with Shopify as well as with any other Rails app.  Here are few examples of some of the open source projects which have spun out of Shopify:

Here are a couple of other apps that we also released but are not open-source:

  • Vision – Tool that emulates a Shopify install for designers
  • Nametag – Domain pointing tool (included in Shopify)

The overall idea is that if something isn't core to Shopify, then we want to make it available as open source for anyone to use. The great news is that all of our open source apps have been used in some very interesting software and by some very interesting companies.

If it had just been just Shopify under development, the delay would have been unfortunate but considering all of the benefit that has come out of this strategy, I think we made the right decision.

5. You've done a brilliant job marketing this product. The pre-launch buzz was fevered and the excitement level of industry leaders reminded me of Jeff Bezos and the Segway. To what do you attribute this marketing success?

The marketing success of Shopify was really just a case of being in the right place at the right time. When we started blogging about Shopify a perfect storm was really brewing and luckily we were swept along with it.  Here are the basic components of that storm:

  • Ruby on Rails was taking off like crazy
  • Shopify was staking its claim as the first e-commerce app for Rails
  • Tobi's star power (core developer of Rails and creator of Typo)
  • People started talking about something called Web 2.0

That being said, we did blog about Shopify a lot, we were also very active in all of our communities and we gave people lots of insight into how the product was coming along and what it was looking like.  So a combination of all that really led to the buzz about Shopify.

6. How have things gone nearly one month after launch? Are they in line with your expectations?

Things have been terrific since launch of Shopify. We have had so much interest from people all over the world which is great. Before we launched there was only a relatively small group of people who had seen Shopify, now anyone can see it and that generates a lot of questions, suggestions, and business opportunities. Perhaps the best part of my day is when I log in and look at all the new shops. It's incredible what people are doing with Shopify and exciting too. Soon enough we will be posting lists of shops on our site so everyone can get a look.

7. There was some hub-bub related to how you planned to price things with Shopify. You settled on 2% to 3% of transactions as your model. Why?

The initial price for Shopify was going to be a flat rate of 3.75%. The idea behind that was we thought that one price would keep things simple. If you have ever checked out what some other hosted e-commerce plans, it's almost like trying to buy cell phone service, the plans are so complicated. In any case, after we let that price slip it became evident that, although it was reasonable for small shops, larger shops doing lots of transactions would actually be paying much more than our competitors.

In order to still make Shopify attractive for higher volume sellers we dropped the price and split it into two tiers, one for sales under $10K per month [3%], and a lower percentage for sales over $10K [2%]. In the end, I think it was the right decision. Most people have been really happy with the pricing and it has certainly shown in the levels of sign ups.

8. What one element of Shopify do you feel/hope will propel you toward market success where others have either failed or floundered? (Just a wish, not hubris!)

The one element that I really hope will propel us towards success where others have failed would have to do with strength that exist within the Shopify store owners' community. Making a profitable e-commerce store is hard work. I love the fact that Shopify clients help each other in our forums. I love the fact that everyone feels like we are in this together and that we all will succeed together.

If I could pick a second element, it would have to be that I truly believe that we have made software simpler. Tobi and Justin Palmer have worked like dogs to make Shopify easy to use and that's not just a marketing quote either, it really is easy to use. I feel that we have gone beyond any other e-commerce app to date on this front and both Tobi and Justin should to be recognized for their efforts in this respect.

9. Can you share some of your favorite sources of business inspiration and ideas? (e.g. certain books/magazines/blogs)




10. What you've attempted to do is hard: Build a very significant application, enter an industry full of very strong players, stay true to your values, and on a budget. Do you have any advice for other aspiring entrepreneurs attempting to launch pull off a similarly insane venture?

Well, the best advice I can give you is what you mentioned above -stay true to your values. Tobi and I knew what kind of company we wanted to have and we have worked very hard to make Jaded Pixel the best place either of us could ever work. I worry day and night about our business but I never worry about how we are doing business because I know it is fair and honest and that is the most important.

A huge thanks to Scott for taking the time to share these insights and ideas behind his journey.

Scott has agreed to answer any questions you may have, in the comments to this thread.

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