iPhone App-Trepreneur: Part 1 -- Desperately Seeking Ka-Ching

Tue 06 July 2010

“You cannot get rich selling your own time.” -- Scott Adams^[1]^

You can, however, make great fortunes selling things. When I was a kid, there was a girl in school who was heir to a pencil fortune; every time you took a standardized test and filled in one of those ovals completely, her accountant smiled. I don’t know how much more money there is left in building a better mouse trap, but an iPhone app that makes farting noises can pull in “more than 10,000 dollars per day.” ^[2]^ (more, mind you).

In 2002, I wrote a book about programming. It so happened that my book contract very explicitly gave me all electronic rights for publication; this, while unusual, was not considered a big deal back in the mid-late ‘90s when the contract boilerplate that I essentially inherited was created. This was right after the dot-com boom and developing an eCommerce Website was still somewhat esoteric. Were you to poll a group of small companies that sold specialized products online, the average cost of developing an eCommerce Website in the early 2000s would certainly be in the tens of thousands of dollars. (“Somewhat esoteric...high average cost...” This is going to be a theme.)

So, I wrote a simple little eCommerce Website. The coding was simple, as it was something I had done before. The harder part was aiding my bank in understanding the then-odd idea that this company run out of a cottage on Creek Road was going to be generating tiny electronic deposits throughout the day and night. and sold the electronic copy of my book at a bunch of pricepoints (If I recall correctly: \\(3.95, \\)5.95, and \$11.95). Two important things need to be noted here:

  1. It was considered indisputable that an electronic version of a book was considerably less valuable than a print version of the book, but it was evident to everyone that some amount of revenue was possible from eBooks, and;
  2. My royalty on the first several thousand copies of the print book, whose cover price was \\(49.95, was about \\)3.75. In other words, I made as much money on the cheapest electronic version as I would on the print version.

The most important thing I did was write the software so that every time I made a sale, my computer played a cash register “KA-CHING” sound.

I’d be sitting at the computer writing the book or working on some code and I’d be distracted by the “KA-CHING.” But that was okay -- it spurred me on and there are worse ways to be distracted. Much more importantly, I’d be eating dinner and talking with my wife and off in the distance -- “KA-CHING.” Sitting on the couch watching TV -- “KA-CHING...KA-CHING...” And I’d apologize to my wife and go over to the computer and turn it down (but I’d usually try to leave it at a just-barely-perceptible-to-me level).

Sales weren’t great; it was hardly like living inside a pachinko machine. But if you make your living selling your time, there’s no KA-CHING except when you are on the clock. Eating dinner? No KA-CHING. Watching TV? No KA-CHING. Sleep, checking baseball scores, walking the dog? No KA-CHING.

This was a profound realization for me. At the time, I had a wonderful dog who needed (and got) an hour-long walk every day. For the first time in my life, when I came back from that walk, I was (by a small amount) richer than I had been when I left. Not as much richer as I’d have been had I neglected Cheyenne and spent the hour on the clock for someone, but that wasn’t an option.

Being a fool, I mentioned my situation on a mailing list for authors and publishers. And, apparently, it caused quite a kerfuffle at the publishing company that was about to squeeze a bunch of ink onto a whole bunch of dead trees in order to produce something with a \$49.95 cover price. No one knew how much money an eBook was worth, but publishers sure as hell weren’t happy with the amounts I was charging. Being, as I said, a fool, when they demanded that I stop selling the book electronically, I complied immediately. I thought we could work something out (again: Fool). It all ended in tears. ^[3]^

In the end, I vowed two things:

  1. If I ever again spent 10 months writing a book again, it damned well was going to be a novel, and not 1,184 pages on C# programming.
  2. One day, the KA-CHING would be mine again!

Stay tuned for more heart-pounding entrepreneurial advice from a self-described Fool! Tomorrow’s Episode: Opportunity Always Ring-Tones Twice!


iPhone App-Trepreneur: Prologue


[[1]{#1}] Unless you’re a doctor or lawyer. Both of which are professions that use strict licensing to forbid (or at least highly discourage) competition from smart people who live overseas. Which is something that’s always cropping up in software development circles under the guise of assuring “professionalism.” Uh-huh. Because if there’s one thing that the past decade has proved, it’s that companies recognize, reward, and seek out professionalism and not the promises of low-bid incompetents.

[[2]{#2}] http://www.thedailyshow.com/watch/tue-july-21-2009/ifeud

[[3]{#3}] Lawyers got involved. Which is short-hand for “the guy in the little cottage on Creek Road got screwed and humiliated and paid for the privilege.”

  1. Prologue
  2. Part 1: Desperately Seeking Ka-Ching
  3. Part 2: Opportunity Always Ring-Tones Twice
  4. Part 3: Cost Control