Pricing That Scales

We recently started charging companies to use Sqwiggle after only a month in private beta. We definitely don’t have all of the functionality that customers asked for, there are still bugs and the price is high enough to put-off some companies from using the service.

At first glance this might seem like a terrible idea, but being clear about our pricing and business model from day one has helped to both differentiate Sqwiggle from other perceived competitors and proved that companies are willing to pay to solve the problem we’ve identified - a crucial part of validating the business idea.

SaaS Kicks Ass

The best pricing strategy balances the needs of your startup and customer perfectly. I believe this is the reason that SaaS has become an increasingly popular pricing choice. Our current model is to charge monthly, per user with a two week free trial. Every factor that makes this a great choice for Sqwiggle also works as an advantage for the customer.

For example, we plan on running servers for hosting video calls with many participants through Sqwiggle. For an app that becomes part of a teams workflow being used all day, every day, the cost of this soon becomes significant. By charging per-user, as the amount of video bandwidth increases, so does our income.

On the flipside, charging per-user allows the cost of using Sqwiggle to grow with the size of your business. If you’re paying an employee thousands of dollars in wages per month then a couple of cents per day to make them more efficient and happy is a no-brainer.

There are also a ton of other advantages that have been covered many times; predictable recurring revenue is the lifeblood of a SaaS business allowing us to plan expansion, costs and hiring. A trial with zero upfront payment means that employees can champion Sqwiggle internally and see the benefits without needing to ask higher management for approval.

The Price Point

It’s very early days and we’re still experimenting with the optimum price to charge per user. At the moment we have a single price of $9 per user, per month. There were a couple of factors that came into our decision to choose this amount:

Value

For a distributed team Sqwiggle offers a lot more value than the competition with persistent presence and instant video chat - we wanted to reflect this in the price, charging more than the typical $2-3 per user.

Psychology

Three studies by MIT and the University of Chicago in 2003 showed "conclusive evidence that $9 price endings can increase demand", even amongst cheaper options. Whilst still charging a premium price and taking into account this rule we wanted to keep the figure as a single digit so that psychologically it still feels like it is relatively much lower than $10 or $9.99 than it is.

Simplicity

One of the key values we have at Sqwiggle is simplicity. We put great pain into ensuring that every part of the product is easy to use and understand. Having a single price keeps things inline with our values and avoids any decision paralysis. “A decision can be treated as over-complicated, with too many detailed options, so that a choice is never made”.

What do you think, is this strategy wise? Is there anything you would you do differently? I’d love to hear your comments.

This post was written as part of StartupEdition, a weekly collection of curated posts by startup-minded people. Read more thoughts on pricing strategies here.

Build Company Transparency and Reduce Email Using WordPress P2

Wordpress P2

At Sqwiggle we’ve been using the P2 WordPress theme for over a month now for a large chunk of our asynchronous internal discussions and I thought it would be interesting to pull apart our time with it a little.

What is P2

For those that might not have heard of P2 before - It is a theme based on Prologue which changes the flow and interface of WordPress to move composition inline. This makes creating posts as easy as Tumblr or Twitter for example, changing the dynamic to that of an internal social network.

In the last month three of us have posted 170 times with 50 different tags, and commented on those posts over 260 times, presuming we would have had these conversations over email we might have saved our individual inboxes of around ~430 emails each and that’s not even counting other interactions such as ‘liking’ a post!

What is it good for

Asynchronous discussions

P2 works like an internal tumblr, you can quickly create different types of posts such as status, link, quote or a more formal blog-style post. Others can comment and comments can be nested leading to good discussions.

Encouraging transparency

With email it is easy to accidentally forget to CC team-mates or not realise that others might have great input on a seemingly unrelated issue. Stripe fights this by having all internal email open, P2 can help you to reduce or cutout email altogether.

Extensibility

Of course WordPress is open-source so in theory it would be possible to make any customisations you like to any part of the theme. There are already some ’must have’ plugins for P2 such as likes, @mentions and more that need to be installed to get the full benefits.

Search and archiving

Of course WordPress comes with tagging, categories and a pretty decent search. Finding that discussion you had on a particular topic is easy with a combination of these (Of course we only have a months worth of content - so only time will tell here!)

Cost

As WordPress is free software the only cost in hosting, we have our P2 installation hosted on a cheap VPS and the cost is negligable. You could use a hosting service like WPEngine if you preferred not to take care of this yourself.

What is it bad for

Realtime discussions

Although not ‘bad’ per-say, we prefer to keep real time discussions to our Sqwiggle workroom - If everyone is online, then it’s just much quicker and easier to make decisions this way.

Items posted in P2 don’t necessarily need a reply straight away, or ever in a lot of cases.

Aesthetics

The out-of-the-box experience with P2 isn’t incredible, the styling is rough around the edges, as are many of the plugins. We spent a couple of hours customising the theme to match our internal admin tools a little better, but nothing too fanciful.

If you want a finely polished experience then this probably isn’t the tool for you unless you like customising your software!

Where next?

I’m really excited to see the development of Inc from the Kippt team as it seems they are tackling this space in a great-looking and easy to use package.

I don’t think we could go back to not having a tool like this in our arsenal here at Sqwiggle. An internal social network is a must-have for any distributed team, whether it be a tumblr, twitter or a reddit clone!

If you don’t have an avenue for casual, rich, asynchronous communication in you company then you might just be missing out.

Why Internal Dogfooding Matters So Much

Om nom nom nom

Dogfooding: A slang term used to reference a scenario in which a company uses its own product to demonstrate the quality and capabilities of the product.

I guess I’ve always been a little envious of companies like GitHub and 37Signals, not for the many obvious or usual reasons but because they get the joy everyday of the software they create and the software they use to create it being one and the same thing.

For certain products I feel like this actually goes a lot further than just dogfooding, every company knows they should use their own product. But in this case It’s recursive positive feedback, an upward spiral of greatness where you improve your product and this in turn makes the team better/happier/more efficient at improving your product. I can’t think of a situation more perfect for a newly born startup - where really understanding your customer and market is the most important factor.

At Sqwiggle we’re lucky enough to have this possibility, we’ve been distributed from the day we started working together and have been using the app as our primary form of communication from the moment it became viable. We have morning banter, long discussions, quick questions, rolling laughter and even more on Sqwiggle. Of course, we consistently come across small and big bugs, performance issues, user experience problems and interface improvements. Being the ones discovering the majority of these things also lets us more easily prioritise the pain that they cause.

We recently got to the bottom of a memory leak in Sqwiggle that happened only in the rarest of circumstances, but when it did occur the browser crashed spectacularly leaving no debugging info behind! Had we not been using the app as much this issue may have gone unnoticed or deprioritised for a long time (in fact it had come up in support as a random ‘white screen’).

Great beta testers and users will let you know of major issues and when they can’t understand how to use or find a feature - but there are a myriad of small user interface interactions, improvements and ideas can only be found by exhaustively using your own product all day every day.

Photo by Sh4rp_i

The Future

The Future

In February I left Buffer after working on every aspect of the app for over a year and a half (and documenting a lot of the interesting bits here along the way!). I’m immensely proud of everything that we achieved in that time, growing the service to half a million users and the company to 10 awesome team members whilst travelling! Buffer isn’t going away any time soon and I’m sure the companies future is very bright with Joel and Leo steering the ship - I can’t wait to see what they have in store.

So what now? I’m excited to say that I’m now building a new company to tackle the problems with remote working and distributed teams with a couple of awesome guys, Matt and Eric.

It’s a problem I’ve been thinking about ever since I stopped working in an office environment - how can you bring back the fun, spontaneity, and speed of communication of an office into the online world? It is a huge challenge, both technically and socially - we’re tackling the problem in a unique way and think we have a pretty great solution brewing

If you have any thoughts on distributed teams then please go ahead and leave them in the comments, I’d love to hear any experiences or problems that you might be facing.

Photo by Sam Howzit

Hacker New

Around a year ago during my time in Hong Kong I started working on a Chrome extension for Hacker News. The aim of the extension was to make the site easier to use and add some (in my mind) much needed functionality.

Today i’ve released the latest version of the extension which addresses many of the concerns from the previous versions both on HN and Github, here’s a little tour of all it has to offer:

User Following

Following on Hacker News

Hover over any username provides the option to “Follow” or “Unfollow” a user, followed users are highlighted wherever the appear, allowing you to pick out articles and comments from friends and thought leaders.

Instant Inline Replies

Previously replying to a comment meant opening a new page, inline replies mean you can type within the page and then submit when you’re finished. It also means that long replies won’t cause a timeout!

Inline Replies on Hacker News

Retina Support

The extension replaces the existing image assets such as vote arrows and icons with higher resolution versions suitable for Retina displays. Thanks to Christian Genco for the idea.

Improved Readability

Hacker New increases the size and colour contrast between links and surrounding elements. It also makes it clearer which articles you have already clicked on.

Quick Profiles

Hover over a username anywhere on the site to instantly see a users Karma and affiliated websites / social profiles. This is a useful indicator of how much respect they have gathered the HN community.

Filters

Filtering on Hacker News

Filtering allows you to hide articles, users and domains from HN that you would rather not see. I have my filters setup to filter a variety of negative keywords and trashy domains!

Endless Scrolling

The frontpage just got longer, infinitely longer in fact. Endless scrolling kicks in before you reach the bottom so the news keeps flowing. The footer and search bar are always available by hovering near the bottom of the screen.

Collapsible Threads

If you just want to immediately skip past a thread, you can now collapse the entire thing on the right hand side and get directly to the next comment.

Social sharing

Social sharing buttons are built in for Twitter, Facebook, Google+, Buffer. Of course they don’t load until you request it so there is no extra bloat on page load times.

I hope the extension improves your HN experience as much as it does mine. If you think something can be done better or would you prefer to tweak the styling go ahead and fork the project over on Github!