Making A Living
Here at Bridge Squared, we love software. We have been developing solutions for more than 30 years and we take great pride in continually improving our craftsmanship and helping make people’s lives easier through our work. But like everyone, we have families to look after, bills to pay and as a result we have to find a way to make money.
This is relatively easy when building software for large commercial organisations. As long as you can deliver the required quality in a timely manner, there’s a going commercial rate and these companies are willing, and able, to pay because of the benefit that the solution provides. But for solutions aimed at helping individuals, families and small businesses, a profitable rate is in most cases far too expensive and as a result you have to look at other business models to find a way forward.
With our new range of Family Finance Manager software, this is precisely the problem I am struggling with in this blog post.
Introduction
The purpose of this document is to undertake an exploration of our thinking about how to publish a software application and make a living from it. I examine what it is we have to offer, what our business objectives are, how we might earn money from it and how we might reach our customers.
The Products
We have three main offerings at the moment:
- Family Finance Manager
- Family Finance MS Money Extension
- Family Finance Server
The intention is that all offerings would be downloadable and installable directly from the Microsoft App Store as that is the easiest and safest way for users to get the application.
Family Finance Manager
This is the core desktop application product. It provides the functionality for a single user to record and analyse their, and their family’s, financial activity. The current product is a Microsoft Windows product which can be downloaded and installed directly from the Microsoft App Store.
Family Finance MS Money Extension
This is a specialised component that allows the user to import data directly from a Microsoft Money file into Family Finance Manager. The extension provides that connection and allows for an almost one-to-one mapping of the data into Family Finance Manager and thereby gives existing MS Money users a way of taking their data forward.
The product can also be downloaded from the Microsoft App Store and at the moment the technology is bound strongly to Family Finance Manager but there would be opportunities to provide other functionality to allow people to take their data to other platforms if that becomes a more interesting market.
Family Finance Server
This component offers the ability for multiple users to share access to the same data file. This is predominantly targetted at families where multiple users need to access the data securely and safely. This product has been tried out but hasn’t yet been published to the store and would require further work before it could be made into a proper product.
Business Objectives
Before working through the options, it feels right to try and define what it is that we are trying to achieve, both in terms of getting the solution out to users and how we make a living going forward. For us, this isn’t just about making money as we have a core set of values that we wish to uphold, in particular how we look after customers and listen to their needs.
So the initial thinking suggests the following elements are key to our vision:
- Making an ongoing living
- Reaching a large number of users
- Evolving the application(s)
Making an ongoing living
So the point is that in particular we need to achieve an income that continues going forward. The bills won’t go down and as a result we need to ensure that we have a continuing source of income otherwise any plan will quickly become unworkable. This means that the business plan has to show a way of reaching an income level and sustaining it. The plan will need to consider how we react to change in income patterns, what contingencies we have in place and how we should subsidise the product development until certain objectives are reached.
Evolving the products
I think this is really important. We have visions for how the product can evolve to become more and more useful but to really make real progress we need both to be able to work on it full time but also we need users who can give us feedback and help work out what works and what doesn’t.
Building a community
So one of the questions is what kind of community are we talking about. We want users to get involved in grown the product which means giving feedback. But at another level we would want users to help each other? Another part of this is that we probably have another kind of community which is people that wish to build their own software, I’m not sure how they would get involved but it is worth bearing in mind that there are people who want to get into the software industry and at some level teaching people how to code is a possible part of the offering.
Revenue Streams
At the moment the primary distribution method for the software is the Microsoft App Store. This offers, but does not require, a number of different revenue generation opportunities and it is probably worth exploring other opportunities to try and develop a balance vision as to how we should proceed:
- Microsoft Store
- Patreon
- Github Sponsorship
- Youtube Content
Microsoft App Store
One key potential source of revenue is to charge for the software through the Microsoft App Store. The fees are between 15% and 5% of net price (exc. VAT). To qualify for the lower fee we need to create custom app promotions and get people to access the app that way.
We have options for trial periods and in-app purchases. In-app purchases can include a subscription model if we wish.
- Trial Period
- In-App Purchases
- In-App Advertising
Trial Period
We can offer trial periods both for the main applications and/or the add-ons. The periods vary up to a month for the application itself to a couple of weeks for the add-ons. At some level there does seem something right about there being a price attached to the application but I worry that that will limit the number of users which might not help development.
In-App Purchases
The store can be configured so that we could have in-app purchases for extra functionality. This could be for subscriptions to give access to support lines or alternatively it could be just for an optional donation. We could use in-app purchases to support more functionality, for example we could require users to purchase the MS Money import as a an add-on. There could be special functionality that we make available directly. One area could for people to buy support services over and above the Open Source support we can offer via Github.
Advertising
I think I’m completely against this as an approach for generating revenue. It looks like the majority of in-app adverts are for gambling apps and that’s something I’m completely against.
Github Sponsorship
For a pure open source project, it would be possible to use Github Sponsorship to raise funds. The fees are zero which is very attractive but it would require getting customers to create Github accounts and taking part in the open source model. That would require training on the users side. Though it sits very well with the desire to become the customer’s developer of choice. We could use the funding raised that way to pay for support platform such as Zendesk.
Patreon
Patreon sees itself as an engagement platform for fans. Though typically targetting the creative industries it might be possible to use it as a way of generating funds for our projects.. The charge is 10% and the general expectation is that Patreon customers would get access to special content which might not work for us.
Youtube Content
It would be possible to create You Tube content and maybe benefit from advertising revenue. Maybe we would just use it as a platform for hosting training videos or alternatively could we extend it to doing software development training?
Kickstarter
Another thought is to use something like Kickstarter as a mechanism for raising funds for particular features. I’ve certainly wondered about whether this would be right approach to undertake development to support Open Banking because of the costs involved.
Potential Customers
It’s all very well talking about how we are going to make money, but we must not forget that we actually need people to use the application(s) before they will pay. We will need customers! So it’s probably a good idea to think about who these customers might be.
Microsoft Money Users
One group of customers we should be strongly aligned with are those still using Microsoft Money and wondering where to go. We are probably the only company that is working on trying to extract data from MS Money and are probably a world-expert on that particular topic. Obviously there is a question about how many of these are out there, but there a number of sites I’ve come across that we could place a post and start to generate some interest. In many ways this is the only customer group that I feel that we have a direct route for engaging them.
Individuals
This is an interesting question as to how we target individuals. I think the key individuals will be those with MS Money. I’m not sure at the moment that we can actively pull in millenials with their phones. However, having said that, we do offer a specifically different model, they are responsible for their own data and would not be reliant on some up start cloud based company taking care of it. Also we do offer a wide range of tracking that is more generic than some of the phone app offerings.
Families
I think that the family specific configuration is something we should be making more of as I don’t think they are directly targetted. We might need to do some more work on it, like incorporating a pocket money tracking capability, and I’m not sure how we would target them, unless we go through the social media route?
Retirees
Not sure these are a group that we are targetting just yet, though I think they are more security conscious and maybe the local data would appeal to them. Further more with our view on total return for investments we might be able to appeal to them further down the line?
Core Values
Whilst we consider the options, we should also consider carefully our core values to help understand how we might best address them through the business plan.
- Right to privacy
- Right to your own data
- The customer isn’t the product
- Right to repair
- Self-determination
- Against locking in the customer
- Transparency
- Integrity
- Best practice
- Minimise costs
Customer Privacy
We should ensure that anything that affects a user’s privacy should be an opt-in.
Customer’s Data
Key here is that the data is the customer’s, it’s not our data to use for our own benefit. And with that stance we have a responsibility to ensure that they can access the data and use it for themselves.
Right to repair
We believe that once the customer has bought the product they should have a right to repair it themselves if they so desire. For that to happen they do need access to the source code and the data should be accessible.
Best Practice
If we follow the model of being the customer’s software developer, our best practice has to be to look out for their interests. That should drive a lot of our design, marketing and business model decisions.