Fog Creek Software
Discussion Board




Revenue

Joel, how much revenue has Fog Creek brought in this year?

Carl Sagan
Friday, November 08, 2002

The answer to that question is meaningless without also having the answer to "What were FogCreek's total overhead expenses this year?"

Bella
Friday, November 08, 2002

maybe Carl is not interested in expenses, et. all :-)

Prakash S
Friday, November 08, 2002

Still, it's a rude question. Fogcreek is not publicly listed.

Alberto
Friday, November 08, 2002

I fail to see how it's rude. I'm not interested in if they're profitable or not, I'm interested in seeing how successful the company has been in selling products.

Carl Sagan
Saturday, November 09, 2002

I'm no expert but to some people the question might seem the equivalent of asking, "Joel, what was your income last year?"  The company is private and probably mostly owned by Joel.  That may be a reason why the question appears rude to some people even though you are not interested in Joel's income but the profitability of running a software company.

I think people will know you meant no harm and understand your curiosity about the profitability of running a company that is small yet smart and innovative.

Diego
Saturday, November 09, 2002

*the profitability of running a software company.*

Sorry, Sagan.  I meant:

I think people will understand that you want to know how successful Fogcreek has been in selling their products, not about profitability.  Sorry...  i seem to confuse success with profitability which is wrong depending on the case.

Diego
Saturday, November 09, 2002

Not all companies view it as rude.  I've worked for private companies that boasted about their revenue.  Still, it deserves a little more tact than blurting out a request on a message board.

...
Saturday, November 09, 2002

Do you really expect Joel to share this with you? speaking of naiveity

Farid
Saturday, November 09, 2002

Joel uses joelonsoftware.com to spread the word that he is clever und runs a successful company. He covers everything to prove that, how he hires people, what tools he uses, which he doesn't and why, what other companies make wrong. And mostly I agree with him; after all that's why I come back to his website. Yet, there is only one aspect that Joel leaves out: profitability of his company; though that would ultimately prove if he's right or not. In this view, Joel could be happy to have a possibility to say:
Yes folks, my preaching is right and I have a worthy company.

BTW, the only one who may think the original poster's question is rude is Joel.

René Nyffenegger
Saturday, November 09, 2002

It's always seemed a bit like armchair quarterbacking for Joel to write about how he has all the answers about how to run a software company *before* he ever actually tried to do it himself.

From the few indications that he's given about revenue, I suspect it's not as easy or cut-and-dried as he thought.

I think most of Joel's writings are well thought out and show the carefully considered experience of a "trencher."  I would be pleased to see that such experience is all a company really needs to succeed.  But I doubt it.

Bob

Robert Anderson
Saturday, November 09, 2002

"It's always seemed a bit like armchair quarterbacking for Joel to write about how he has all the answers..."

Have you ever read, "Philip and Alex's Guide to Web Publishing", by Philip Greenspun?  It was written when he thought the world was his oyster.  I imagine he finds it slightly embarrassing now (Greenspun's company ArsDigita crashed and burned in a spectacular fashion.)

Reminds me of my friend Francine's wedding from 1996.  It was a very lavish, formal affair.  Must have cost tens of thousands.  The bride and groom seemed happy together.  Fast forward six years:  the couple are in the midst of an extremely nasty divorce, among allegations of infidelity, spousal abuse, and drug addiction.  When I flip throught "Philip and Alex's Guide", I feel about the same way as when I look at photographs from my friend's wedding.

J. D. Trollinger
Saturday, November 09, 2002

"Hey General, what's your next target?"

"Why won't you tell me?, I'm not asking if your winning the war"

the competition is listening
Saturday, November 09, 2002

JD,

Good point. Perhaps lavish spending and trying to impress friends is a good predictor of failure for both marriage and small business. On the other hand, thriftiness and hardwork would be indicators for success.

--

Others,

Yes, it is quite rude to ask questions of income in US and some other western societies. In some traditional cultures such as parts of Africa, the amazon and some of the South Pacific, such questions of curiosity are considered normal. In this particular case, it seems the reason for asking is to gather information as a set up to shoot down or criticize another person in which case it would be considered rude in all cultures.

--

BUT, a related question is of interest and might serve to answer your agenda better. What is the market penetration of CityDesk? I estimate, having done 5 minutes of research, that there are between 200 and 2000 copies that have been sold. Could be completely wrong of course. I just looked for a few keywords I thought might appear on some joel sites, then came up with a wild estimate using a randomly chosen fudge factor.

I assume that consulting in FogCreek's major source of income, followed by FOGBugz, and finally CityDesk, which being consumer shrink-wrap software with free competition, probably is a loss-leader that draws interest to the company and its products.

Ed the Millwright
Saturday, November 09, 2002

I suspect Fog Creek is barely breaking even, if that.

Two very competitive markets he is attempting to penetrate.

High fixed expenses given where he locates his bidness.

Don't let the (finely tuned and well done) Joel Jive fool you ...

George Leroy Tirebiter
Saturday, November 09, 2002

Personally, I hope he's making a bucket, the products are good and deserve some success.

Sure, sometimes there is a bit of arrogance in the writing, but hey, we keep coming back don't we? At the very least Joel created something for a lot of people, which is more than can be said for most of us.

Why the desperation to to see someone fail?

Alberto
Sunday, November 10, 2002

Keep in mind that Fog Creek Software has a source of income other than FogBUGZ and CityDesk -- their consulting work.

programmer
Sunday, November 10, 2002

To J.D. Trollinger,

I don't agree with the comparison you made to "Philip and Alex's Guide to Web Publishing".

The book is of it's time and in that time the world really was his oyster, that's why he was able to grow a company in such a relatively short amount of time. Read http://eveander.com/arsdigita-history for an insiders take on why it failed.

As for the technical aspects, his web publishing approach and solutions still work and are available for anyone to use (see http://openacs.org/ ), they didn't die with the company (pretty nice of him to share this huh). If you really did read and understand the book (or are you in the coffee table book owner category?) you'd realise that the engineering decisions he describes are rock solid and definitely in the REAL world.

It's a great book, nothing at all to be ashamed of (even the indulgence in photographs is replicated in this web site among other inspirations and lessons, see http://www.joelonsoftware.com/articles/fog0000000021.html for details).

With regard the original question Joel himself has said that consulting helps to pay the bills (see http://www.joelonsoftware.com/articles/fog0000000013.html ) other than that it's none of our business ... that doesn't mean I'm not curious though :)

Defender of the Greenspun
Sunday, November 10, 2002

Well, Joel has been sticking around for a while, so he's either making enough to cover his costs (plus some unknown amount of profit) or he's piling up lots of debt. Since Joel seems like a smart and happy guy (and he doesn't mention venture capitalists much, aside from poking fun at them), I'd go with the former explanation. :)

Dan Maas
Sunday, November 10, 2002

BTW Greenspun was able to take some millions out of the venture... from that point of view, he has been quite successful.

Other people having made good money are the guys @ togethersoft being acquired by Borland.

People w/ good ideas and the ability to act will and do get the money. As for the detailed amount, that's another story.

Philippe Back
Sunday, November 10, 2002

I'm another one backing Greenspun.

The man was quite ahead of his time. Reading his book was quite an eye opener for a lot of people, myself included.

His ideas including giving people free training to use and develop with an opensource package was great. I even attended one of the bootcamps in London(UK). All the stuff I have heard about aD University have been positive.

I recall Greenspun himself writing about how when talking to VCs, being told that they would invest, but were not so keen on an untried management. His response had been that if that was the case, they should take the opensource toolkit (forbear to http://openacs.org ) and build a company around it themselves. He seemed to have ignored his own advice somewhere along the line :-(

I remember the old arsDigita website. The man ran the company very openly. Anyone could go through the site, and see the internal workings of the company. Hell, even typical engagement contracts, and financial details were online.

When the VCs came on board, things started changing. All of a sudden, information was not available. From being a good resource, the website turned into an uber sized BILLBOARD.

Then they rewrote the entire codebase in Java .....

Still, Greenspun seems to have come out of it all with a bit of money, so if money is  a measure of success, he did not do too badly.

tapiwa
Sunday, November 10, 2002

I like Greenspun's book.  It sits on a shelf next to my computer desk.  The book makes some good points about creating high-quality websites, but mostly I consult it when I feel that I might be getting too big for my britches.  Reading a few pages restores some humility.

My original point was that Greenspun's hubris makes him look foolish in light of what actually happened to his company.  Recall that he didn't just discuss technical issues -- he also doled out business advice.  See, for example, the sub-section of Chapter 2 that's headed, "Growing ArsDigita the Sustainable Way".  Talk about counting your chicks.

Sure, he and Eve Andersson blame all their failure on the venture capitalists, but I'm skeptical.  Who brought them in?  Who signed the contracts?

J. D. Trollinger
Sunday, November 10, 2002

PANDA is still relevant from a technical perspective, because it mostly spends time debunking overly complex technical architectures.  It's a good read and reasonably sound on that front.

The fact that Greenspun got greedy, ignored his own advice about sensible business practise, and has a bunch of people claiming he's a lousy manager (and incidentally, some of his code isn't very flash when you poke about...), and aD the company tanked doesn't really tell me much about the value of his technical opinions, just that I shouldn't necessarily take his business advice.

Joel, on the other hand, largely defines his technical advice in terms of how it affects his ability to run a successful company, which is why he's an interesting counterpoint to Greenspun and the (many) other people who are looking at things from a more purist standpoint.

Rodger Donaldson
Sunday, November 10, 2002

Outside of the public corporation model, where the point of the existence of the corporation is to make money for the shareholders, a small private company exists to provide a living for its employees. 

In that regard a profit on the bottom line isn't necessarily the most important issue, rather its the cash flow.  If you don't have adequate cash flow in a small company then no matter how profitable it is in the long run it will die in the short run.

There's a sudden realisation when you start employing people that you (as the Principal), aren't just running a business for your own and your family's sake but your employees and their families' sake as well.  When it comes down to it, the employees come first and then the Principal.

Other than cashflow the other major cause of failure in small companies is under capitalisation.  If you don't have a bedrock to the company then its very difficult when times are rough.

Simon Lucy
Monday, November 11, 2002

Greenspun got greedy, and the company got burned, but let's not forget he came out of it with a Ferrari and a plane...

I'd say that counts as a success. All software (with the possible exception of CICS) is fairly transitory. The trick is to turn a successful company into a pile of money before they go up in smoke. (Something I've never yet learned how to do).


I mean, frankly I'd rather have a big pot of money than a software company anyway (not that I currently have either, but we're working on it) but that's just because money sits there, whereas companies give you ulcers.

Katie Lucas
Monday, November 11, 2002

this is an old horse, that can be fun to beat. i'm reminded of some fun threads at f*cked company.com. Katie says that greenspun is a success, because he came out of it with a ferrari  and a plane. he actually came out of it with a WINNEBAGO and a plane, the ferrari was a company rental.

anyway, the way greenspun cashed out was to file a lawsuit against the company, related to ambiguity in some corporate legalese. he then made it clear that he would be a pest and drag out the lawsuit forever, if they didn't pay up. thus, he was paid off, to the tune of about $5 million dollars. which happened to be arsdigita's cash reserves. too bad for the employees expecting a paycheck the next month. 

i'm not that bitter, because i was just a peon, and  i've learned that's how it goes in business. but the thing that really bit me, is that there were about 5 people who were with greenspun from day 1 at arsdigita, and how much of that $5M did he offer to share with any of them? Zero. 

ex-aD
Monday, November 11, 2002

The Saudi proxy server blocks access to f*kedcompany.com so I can't see the threads, you mention. Perhaps you could regurgitate some of the juicier ones here.

If the management of Arsdigita paid off a nuisance lawsuit with the total of their cash reserves, then  something sucks. It's a bit like committing suicide because the district attorney has decided to ask for the death penalty in a felony trial.

What started this off was the claim that Greenspun was a smart 'arse because he wrote a book claiming to know everything about webpublishing, and then his company went broke. Equating smartness with money has always seemed temerous at best, and the fact that Greenspun appears to have made more money out of a failed company than he could ever have dreamed of making from a successful one, surely backs this up.

Stephen Jones
Monday, November 11, 2002

Stephen,

Here's the URL of the ArsDigita thread (the main one, anyway) at FuckedCompany:

http://comments.fuckedcompany.com/phpcomments/index.php?newsid=82497&sid=1&page=1&parentid=0&crapfilter=1

Don't know if this helps -- there's probably some kind of proxy server you can use to by-pass the censors.

J. D. Trollinger
Monday, November 11, 2002

well, while I was at arsdigita, we turned down 2 $50M+ buyout offers. the rationale being, if "thestreet.com" was worth a billion dollars, then we must have been worth trillions, because we actually _did_ something.

the lawsuit...the books were so screwed up, i don't think that the company knew exactly how much cash they actually had. our awesome initial controller was scared away by greenspun, and the CFO the VCs installed was a knuckle-dragging ape.

I don't have much more to say about this, It was fun at first, and quickly became not so fun. the main thing i learned: don't do anything you don't want to do, and only worry about your own ass, not the company's.

ex-aD
Monday, November 11, 2002

" only worry about your own ass, not the company's. "

Wise words of advice that I too learned the hard way.

It amazes me how 'friends' will act once it's their bottom line.  Definitely a different experience than what Simon refers to in this quote: " the employees come first and then the Principal".

burnt
Tuesday, November 12, 2002

"only worry about your own ass, not the company's."

I think the better lesson would be "know who to trust."

Tj
Tuesday, November 12, 2002

Ah well, when push comes to shove most people will push the weaker folk off the sled to the wolves. 

Though there is a certain woodscraft necessary in order to jump off the sledge, before being pushed, on the blind side of the wolves and schuss down the slope to the handy guide's hut the other side of the trees.

(Continued on extended.metaphor.com/red-ridinghood.html)

Simon Lucy
Tuesday, November 12, 2002

Very true Tj.

I have since learned that all promises are to be put into writing.  Seems like a no-brainer now, but when you have a history of doing deals with these same people with not so much as a handshake...

burnt
Tuesday, November 12, 2002

Know whom to trust?  How about, "trust no-one".

I recently talked to a lawyer who specializes in working with small businesses.  She said she's had numerous cases where relatives and life-long friends have sued each other over business relationships that have gone sour.

J. D. Trollinger
Tuesday, November 12, 2002

Well, I'm sure the people I consider untrustworthy have relatives and lifelong friends. ;)

Real friends get openly annoyed or disturbed when you overextend yourself, even when they'd be better off.  But it doesn't come up often, since there's usually no point in getting yourself in a bad position.  People who let you do so are immediately untrustworthy, and can never change that.

My CFO is one of these people, and though he acts very decently towards me, doing nice little things, it is extremely nerve-wracking to do anything financial with the company because I simply will never trust him.  (And oddly enough, this makes him trust me...)  I've seen him all too willing to let people hang themselves through naivete.

So.. how far can I be offtopic? ;)

Tj
Wednesday, November 13, 2002

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