This is Signal vs. Noise, a weblog by 37signals about design, business, experience, simplicity, the web, culture, and more. Established 1999 in Chicago. Visit the Product Blog for more information on our products.

Sharding is a database technique where you break up a big database into many smaller ones. Instead of having 1 million customers on a single, big iron machine, you perhaps have 100,000 customers on 10 different, smaller machines.

The general advise on sharding is that you don’t until you have to. It’s similar to Martin Fowler’s First Law of Distributed Object Design: Don’t distribute your objects! Sharding is still relatively hard, has relatively poor tool support, and will definitely complicate your setup.

Now I always knew that the inevitable day would come where we would have no choice. We would simply have to shard because there was no more vertical scaling to be done. But that day seems to get pushed further and further into the future.

Last week I took you through the Highrise signup chart redesign.

This week I want to talk about part of the Highrise home page redesign that we’ve already redesigned. The design is alive – we’re making a lot of small tweaks post launch.

Original: In the cards

When we launched the new Highrise site, we had a block in the middle of the page that looked like this:

Three “cards” as we call them. Each card highlighting a major feature of Highrise. The idea was to rotate these cards every once in a while. They looked good and gave the page a nice splash of color, but they didn’t communicate very well. We were using 163,566 pixels, but we weren’t really saying anything.

Redesigned: In the icons

So we decided to make a change. Instead of using all that space to advertise three features, we thought we’d try using it to communicate eight benefits instead. So in a couple hours we came up with this:

Eight benefits, concisely explained, each with an icon for some color and identity. Now that block says something. There’s more to swallow, but it’s easy going down. And it’s only 98 pixels taller than the cards design. Here’s the overlay (the red is the extra height):

There are only two hard things in Computer Science: cache invalidation and naming things. —Phil Karlton

Karlton’s quote isn’t just for techies. Interface designers are in the business of naming things too. We’re copywriters. It matters if we call something an Event or a Milestone or a Deadline. And it also goes deeper than that. The names we choose shape our software. They define the way we think about it and the way our customers interact with it. To understand why this all matters, you should meet two important ideas from the programming world: domains and domain languages.

When you’re working on software, the domain is the life situation your software is involved with. Basecamp’s domain is the life situation where people are trying to collaborate together on a project. iPhoto’s domain is that situation where someone has a collection of photos and they want to look at those photos and share the photos with others.

Now here’s where it gets interesting. Each application has a way of approaching its domain. Software designers think of a domain like a big cake and cut it into slices. Basecamp cuts project management into Messages, Files, Milestones, To-Dos. Photo organizers before iPhoto ‘08 always sliced their domain into Photos and Albums. In both cases, the software designers take a complicated life situation and boil it down to a few easy pieces with names. No domain comes pre-sliced—unless you’re blindly copying someone else’s software. It’s up to the designer to cut the pieces and give them names.

This process results in a domain language. A domain language is the set of words that reflect the way you cut up a domain. It consists of the pieces you sliced and the names you chose to give them. This language defines an application and makes it special. And for the last couple years Apple has been innovating iPhoto’s domain language very intentionally.

Last week I set out to improve the performance of the Dashboard and Contacts tabs in Highrise. Both tabs would frequently be much too slow. Especially the Contacts tab, which for our own account some times could take upwards two seconds to load.

The number one rule for improving performance is to measure, the number two rule is to measure some more, and the third rule is to measure once again just to be sure. Guessing about performance never works, but it’s a great excuse to get you out in the weeds chasing phantom ponies.

Looking outside the epicenter
So I measured and found that part of the problem was actually not even part of the epicenter, the notes and the contacts. In fact, we were wasting a good 150ms generating New Person/Company form sheets all the time (through a complicated Presenter object that’s high on abstraction and low on performance). Even though these sheets were the same for everyone.

That left me with two choices: Either I could try to speed up the code that generated the forms or I could cache the results. Since speeding up the code would require taking everything apart, bringing out the profiler, and doing lots of plain hard work, I decided to save myself a sweat and just cache. People using Highrise couldn’t care one way or the other as long as things got faster and frankly, neither could I.

I ended up with this code:

<% cache [ 'people/new/contact_info', image_host_differentiation_key ] do %>
  <%= p.object.contact_info.shows.form %>
<% end %>

This cache is hooked up to our memcached servers for Highrise. The image_host_differentiation_key makes sure that we don’t serve SSL control graphics to people using Safari/Firefox, but still do it for IE, in according to our asset hosting strategy.

Good enough performance
But saving 150ms per call wasn’t going to do it. So I added memcached caching to the display of the individual contacts and notes as well. The best thing would of course be if I could cache the entire page, but since Highrise is heavy on permissions for who can see what, that would essentially mean per-user caching. Not terribly efficient and hard to keep in synch. So instead we just cache the individual elements and still run the queries to check what you can see.

Learning grammar has to be one of the most boring parts of studying language, especially studying the grammar of your native tongue. There are always exceptions of course—perhaps grammar is your cup of tea—but I’d bet it’s safe to say that most of us would rather undergo a root canal than sit through a lecture on inflectional morphology or modal forms.

However, when my wife was in college, studying linguistics, a classmate of hers had a really fascinating senior project. He proposed (and in fact, implemented) a sixth-grade grammar curriculum with an interesting focus: he had the kids create their own conlangs, and introduced both grammar and orthography concepts as part of that process. He supported the curriculum by showing the kids interesting real life examples, including (among other things) Mayan heiroglyphics!

I wish wish wish wish WISH that I’d had that man as my English teacher when I was in school. What a fascinating way to present an otherwise dry topic. Practical applications trump contrived examples every time.

Also, if you happen to be into conlangs, you may be interested in the 3rd Language Creation Conference, to be held on March 21 and 22 in Providence, Rhode Island. Whether you want to present or just attend, it looks like opportunities are available. (Disclaimer: I’m not affiliated with the conference, but it’s being organized by a friend of mine.)

Have you noticed how everything is trademarked these days? Company and product names I get, and some taglines I understand too, but some of this stuff just seems a bit much.

A few days ago I picked up some new shampoo. I was reading the bottle and it said “The Kiehl’s Patch-Test™: Before applying…” Why does that need to be formally trademarked? Are they worried Aveda or Redken or some other shampoo brand is going to suggest you use the “Kiehl’s Patch-Test” before you try their shampoo? What exactly is Kiehl’s trying to protect?

In the end none of this is a huge deal, it’s just something I’ve been noticing more and more lately. I wonder how much of this is lawyer driven. I assume it’s a pretty easy way to send a client a bill.

I’ve only known one method for approaching a Design project. There are many variations out there, but it can essentially be broken down into 4 steps: Discover, Plan, Design/Develop, and Deploy. It didn’t matter where I worked—agency or internal design department—these were the steps, and I didn’t question them.

Then 37signals published Getting Real, and I wondered if this might be a better way of approaching a project. I’d like to share with you a few stories from past Design projects while reflecting on how Getting Real would have helped. I’ll also share some insight into how the process here at 37signals works.

Charlie Rose interviewed Malcolm Gladwell recently. They had the following discussion on meaningful work (at 26:00 into interview).

Gladwell: Meaningful work is one of the most important things we can impart to children. Meaningful work is work that is autonomous. Work that is complex, that occupies your mind. And work where there is a relationship between effort and reward — for everything you put in, you get something out…

If you are convinced that the work you are doing is meaningful, then curiosity, there’s no cost to it. If you think there’s always got to be a connection between what you put in and what you get out, then of course you’ll run off with a great excitement after an idea that catches your idea.

Rose: People often ask me to define leadership and I say to them what you just said all the time. You have to communicate what the mission is all the time — and how meaningful someone’s contribution is to the mission.

When you believe that the work you’re doing has meaning, it’s an extra shot of adrenaline. Good food for thought for anyone trying to create a workplace culture that engages employees.

In the interview, Gladwell also mentioned he meets with Nathan Myhrvold once a month to discuss ideas. Myhrvold sounds like quite a character: formerly Chief Technology Officer at Microsoft, began college at age 14, worked under Stephen Hawking studying cosmology, is a prize-winning nature and wildlife photographer whose work has appeared in scientific journals like Science and Nature, is a master French chef who works at one of Seattle’s leading French restaurants, and he won the world championship of barbecue. Talk about a renaissance man!

A couple weeks ago we launched the new Highrise marketing site. We’re still iterating that design post-launch, and we have a big post brewing about that design process, but today I wanted to share some of the iterations we explored for the new signup chart.

The start

Here’s where we started. This was the signup chart for the previous site. You can still see the design action on the Basecamp or Backpack site.

Design A

One of the earlier design directions for the new Highrise site included a light blue background and dark highlight boxes. This was the signup chart direction we were playing with while this design was in style.

We wanted to highlight the main 3 differences between the plans (users, storage, and deals) so we darkened those boxes and colored the text blue. We also introduced a YES/NO list top right to get some key points across related to our signup policy. This was inspired by Southwest’s NO NO NO list on their home page.

The media is biased towards stories that want to be told. This is especially true about the media covering the web world. It’s much easier to write a story about Facebook, Google, Youtube, or any of the other limelight stories where much of the juicy details are willingly shared.

We have so many visitors!
We make so much money on advertising!
We got so much funding!

Inflating evaluations are great when you’re listed on the market, gunning for more venture capital, or trying to bail with the biggest parachute. So naturally these companies drip and drop the honey for the journo worker bees and we get all these silly stories about younger and younger people being worth more and more monopoly money.

In the mean time, many of the real stories are never told. The quiet successes by small teams who stand little if anything to gain by sharing their numbers and telling about their success. Lest they attract competitors or other unwanted interest. They’re just happy making millions quietly from happy customers.

I’ve talked to so many of these entrepreneurs in private and have often been shocked by how well they’re doing. And I always think to myself: 1) why didn’t I know about this?, and 2) if only everyone else knew too.

This is especially evident in discussions about successful businesses online. People point at the big media stories and perhaps a few more and think disparagingly to themselves that this is probably it. If you’re not one of the high profile media darlings, you’re never going to get that trip to space. Bullcrap!

Know that the world of successful businesses online is much larger than that tiny tip that peaks above the surface for a reporter to find. There’s incredible wealth being created below. Sure, they’re probably not making billions (that’s hard to keep quiet), but there are plenty of untold millions.

A few weeks ago we posted a open survey for Signal vs. Noise readers. We were curious what people liked, disliked, what kind of organizations people worked at, how often they read Signal vs. Noise, if they thought the site got better or worse, what they’d like to see more of, their favorite posts, etc.

The survey was open for about 36 hours. 869 people participated before we closed the survey. As promised, here are the complete results.

Thanks again for taking the time to participate.

2008 is over. For all the economic doom and gloom as of late, 2008 was a good year for 37signals. We continued to grow our customer base and our revenues. That makes 5 consecutive years of double-digit revenue growth. We’re very proud of that.

We also hired four new full-time people this year. Sarah Hatter joined us full time in March (she was working on as a contractor prior to March). She heads up customer service/support. Jeffrey Hardy came on in January. He’s a remarkably talented and efficient programmer. Jamie Dihiansan joined us in September. You’ll be seeing a lot more of Jamie’s design work in the coming months. And Joshua Sierles also joined us in September. Joshua’s our second system administrator. It’s really an honor to be able to work with these people — and our whole team — every day.

We’ve also been very hard at work improving our products. Aside from some significant infrastructure enhancements to increase speed, capacity, security, billing, and reliability, here’s a list of some of the major public-facing improvements to our Big 3: Basecamp, Highrise, and Backpack:

Basecamp

• Image Grid View: Any images you upload to Basecamp can now be browsed in a thumbnail grid view.
• Post comments to Basecamp projects via email: Huge new feature. You used to have to log into Basecamp to post a comment. Now you can just reply to the message via email. Especially useful for mobile email users. Hundreds of thousands of comments have now been posted via email.
• More storage, same price: Double (or more) storage increases on all paying plans without a price increase.
• New project switcher: Moving between frequently accessed projects is a lot easier now.
• Bigger file upload limit: Moved up from 10 MB per file to 100 MB per file if you’re using Basecamp file storage.
• Much easier color customization: Brand new color picker brings color customization to the masses.
• Email replies can now include file attachments: Attaching a file to your email reply will post the file to the project now as well.
• Redesigned People & Permissions screen: All new, much easier to navigate, follow, and use.
• Comments (and file attachments) on to-dos and milestones: Huge new feature. Before only messages had comments and attachments. Now you can discuss a to-do item right on the to-do item. Same with milestones. Major productivity gains.

Highrise

• Deal tracking and a Deals API: Huge new feature. Track proposals and deals in Highrise. Keep track of deals won, lost, and pending. Keep track of how much money you’ve earned from each client.
• Advanced search: Search by location, phone, email, and more.
• Bulk delete: Top request: Delete multiple contacts or companies at once. Deleting people is no longer a hassle.
• Improved import review and undo: Review previous imports and roll-back with a single click.
• File view: Now you can just view files attached to a person or company. No more wading through all the notes and emails to find the PDF proposal.
• Major improvements to tasks: Cleaner UI, better date picker, iCalendar feed for dated tasks, and more.
• Bulk tagging: Tag multiple people or companies at one. Big request satisfied.
• Better contact filtering: Recently viewed, recently added, people without notes in 30 days, people who aren’t tagged, etc.
• Faster sidebar search: Major speed increase for the most commonly used Highrise feature.
• CSV/Excel import: Import your contacts from CSV or Excel files. Top request.
• Export all notes and emails: Now you can export all your notes and emails as well (before you could only export contacts).
• New marketing site: Total redesign.

Backpack

• Backpack Multiuser: Huge change. Backpack grows up. More intranet-focused, multiple people from your company can use the same Backpack account, share information and files and calendars across the office or group.
• Calendar strip in the Newsroom: Upcoming events now appear in the Newsroom. You don’t have to click to the Calendar to see if anything is going on today.
• Improved calendar reminders: Select multiple people to receive a notification.
• Introducing the Backpack Journal: Huge new feature. Keep track of who’s working on what and what they’ve finished recently.
• Share Backpack pages even if someone doesn’t have a Backpack account: Previously people had to have a Backpack account to view a Backpack page. Now you can just share via email without requiring the other person to have a Backpack account. Big.
• Reply to Newsroom messages via email: No more logging into Backpack to respond to a Newsroom message. Just reply to the email.
• Read-only page sharing: Now you can share a page with someone without fearing they are going to change or delete it. Big improvement for a lot of people.
• Page notifications and up-front sharing settings: Specify who can see a page when you are creating it. Before you had to adjust the sharing options after creating the page. Removed a couple of steps.

There have also been some big developments in the world of Ruby on Rails including the merging of Merb into Rails 3.

We’re working on some very cool stuff for 2009. We’re looking forward to getting it in your hands just as soon as we can.

Thanks again for reading our blogs (Signal vs. Noise and the Product Blog), following our company on Twitter, buying our Getting Real book, posting jobs on our Job Board, and, of course, using our products. Thanks for being our customer. You make it all possible and worthwhile.

Wishing everyone success in 2009!

Design Jobs

Meetup.com is looking for a Head of UI Engineering/Design in New York, New York.

The Shop of an Entrepreneur is looking for a Worldly Graphic Designer with Diverse Interests and Great Taste Who’s Sick of Hustling Gigs anywhere.

Kink.com is looking for a Senior Interaction Designer in San Francisco, CA.

Cities2night.com is looking for a Front-end Web Designer for Social Site with over 100k users in Philadelphia, PA.

An Internet Startup is looking for a Lead Interaction Designer in San Francisco, CA.

Slipstream Studio is looking for a Web Designer in Southampton UK.

Tuitive is looking for a UI/IxD Designer in Indianapolis, IN.

530medialab is looking for an Interactive Developer in Long Beach, CA.

Atlantic Media Company is looking for a Developer in Washington, DC.

New City Media is looking for a Designer with Flash Kung-Fu in Blacksburg, VA.

Check out all the Design Jobs currently available on the Job Board.

Programming/Tech Jobs

The Motley Fool is looking for a Front End Web Developer in Alexandria, VA.

Octopus Advertising LLC is looking for a Head of Web Development in Dubai, UAE.

Superkix is looking for a Senior Developer in New York, NY.

Firstborn is looking for a Software Engineer located in New York, NY.

The MITRE Corporation is looking for an Experienced Ruby on Rails Lead Engineer in Bedford, MA.

Deep Salt Inc is looking for an Experienced Ruby on Rails / RoR – programmer / codesmith in Atlanta, GA.

FIDM is looking for a Server-side Application Developer in Los Angeles, CA.

Sonic Boom is looking for Rails Programmers in New York, NY.

Peer Giving Solutions is looking for a Web developer in Vancouver, BC.

Check out all the Programming Jobs currently available on the Job Board.

More jobs!

The Job Board is flush with great programmer and designer jobs all over the country (and the world). The Gig Board is the place to find contract jobs.

My Macbook Pro 2.2 just decided to kill the display and all I get is blank on boot. Apparently, it’s a known issue relating to the 1.5/1.5.1 firmware update. When the software fixes don’t work (and they didn’t), the solution is to change the logic board. Nice.

This incident made me think about all the Macs I’ve had for the past few years and how they’ve all failed in various ways. I often donate older machines to family, so I get to hear about how they do 2-3-4 years into the process. And it’s usually not pretty.

My old G4 iMac had it’s DVD drive fail on it after two years. Three of my older laptops have had their hard drives fail (with painful data loss in one instance). One of my Macbook pros that my brother is using lost its firewire ports and its DVD drive (it’s just 2 years old). Mary’s fairly new Macbook air is making weird noises occasionally.

It’s a pretty terrible statistic. Jason’s current Macbook Pro also has a variety of issues and he ordered a new one just to be sure he wasn’t left stranded. Luckily, I also just got myself a new MBP (and the dual-DVI cable is supposed to arrive tomorrow!).

I wonder if this is just par for course. Or if I, and many people I know, have just been incredibly unlucky with Apple gear. But it has happened enough times that it seems statistically unlikely.

So please share your successful run of Apple machines that have been able to last 3-4 years without breaking down. I need to regain some faith.

I’ve been a happy Sirius Radio subscriber since the day Howard Stern went Satellite. I think I’d miss Sirius more than I’d miss cable or any other entertainment subscription I have.

I was thinking about buying another radio recently, but I figured I’d check to see if I could stream Sirius over the net instead.

It turns out Sirius has two internet streaming options. You can stream for free at 32k, or pay $2.99/month (if you already pay for Sirius) to get 128k “CD Quality” sound. $2.99 ain’t bad, so I signed up for that. If you don’t have Sirius, streaming at 128k costs $12.99/month. Sirius doesn’t stream every channel due to some licensing issues, but they stream about 90% including every station I listen to.

StarLightXM

In order to stream you have to use their web-based player which is pretty crufty. So I did a couple Google searches to see if I could stream it through iTunes or some other Mac app instead. That’s where I found StarLightXM.

StarLightXM is a lightweight app that streams Sirius or XM through a native player instead of the crufty web players. You just enter the same login credentials that you would with the online players, and you’re all set. The UI is simple and compact. It’s free (donations accepted) and works great.

So now I can stream Sirius to my desktop. That works. But I wanted to stream the audio to multiple speakers in my house. I have three Airport Expresses set up to play music from iTunes in multiple rooms, but Airport Express can only stream music from iTunes. That means I can’t natively stream audio from the StarLightXM app to my remote speakers.

Airfoil

Enter Airfoil. Airfoil allows you to stream any audio from any program on your Mac (or PC) to your Airport Express-connected speakers. You can stream all system sound or just sound from a specific app.

The way I have it set up is to just stream sound from StarLightXM to my remote speakers. This way I only get system sounds (beeps, new mail, etc) on my desktop, but Sirius plays on my desktop + my remote speakers. It’s a simple setup that works beautifully. Airfoil costs $25.

Airfoil allows you to set volume for each location independently or you can fix volume to system volume. If it’s fixed to system volume you can use your computer’s volume to raise or lower volume in different rooms. If it’s not fixed, you can change your computer’s volume and not affect the volume of the speakers in other rooms. Nice flexibility.

A great way to save

Streaming Sirius over the net is a great way to save some money too. I currently have Sirius radios at home and at the office, but now I can cancel Sirius at the office since I can just stream it over my computer instead.

So for $2.99/month my MacBook turns into a portable Sirius Radio. Plus, I can broadcast to multiple rooms with just a single stream. So instead of paying for radios in multiple rooms, I just pay $2.99/month to stream and point the sound to whichever room(s) I want with Airfoil.

Software is amazing.

UPDATE: Rogue Amoeba, the folks behind Airfoil, have released Pulsar, a Sirius/XM client for the Mac.

Some recent posts at the 37signals Product Blog:

Highrise
Highrise one of “Top 10 most useful webapps of 2008”
“Highrise became a big-small contender in the CRM space this year by adding Deal tracking and full data export. Not to mention, no CRM comes close to making it this easy to keep track of your contacts in detail. After falling off the wagon with Salesforce (multiple times), SugarCRM, and PipelineDeals, Highrise is the only one that became critical to my day-to-day activites at work.”

Newsberry, a service to send and track email newsletters, integrates with Highrise
“With Highrise Sync enabled, Newsberry will automatically sync contacts in Highrise to subscribers in your list. All changes in your Highrise account will be visible in your Newsberry contacts list in which you enabled Highrise Sync.”

What size rolling luggage to buy? Shopping at Amazon, it feels like a shot in the dark.

Lots of closeups of handles and wheels, but what’s the difference between a 19” or 22” bag? There’s no real guidance.

This is the kind of situation where a site that focuses on a specific niche can really shine.

Luggage Online offers a size chart (and Carry-On Luggage Regulations for each airline too).

eBags also offers a Rolling Luggage Size Guide.

Sometimes, a little context makes all the difference.

Today we announce a new way to share pages in Backpack. Now when you share a page you can decide who may edit the page and who may only view the page. This allows certain people to be responsible for editing pages and to allow others to read their pages without allowing the others to make changes. It’s a very useful feature, especially for larger teams.

Here’s how read-only pages work. When you click “Make a new page” you’ll see a link below the people checkboxes that says “Specify who can make changes to this page.”

The checkboxes are replaced by a table when you click the “Specify…” link. The people on your account appear on the left-hand column with the familiar checkboxes to give them access to the page. Then to the right of each person you can set whether they can “change the page” or “only view the page.” Two links above those right-hand columns allow you to apply the same setting to all people at once. By default everyone can change the page.

In this example we want to allow David, Jason and Sarah to change the page. Everyone else will have read-only access. The settings look like this:

A couple of days ago we launched the new Highrise marketing site. We’ll be posting a lot of design-related articles about the design process — including the unreleased versions — over the next few weeks.

A peek behind the scenes

Today I wanted to give you a peek behind the scenes at an app we built to help us maintain the “Fresh News & Buzz” strip in the sidebar. This element is called out in red below:

Extra Extra

One of the things we wanted to do with the new site was to have a place where we could display current comments, ideas, and conversations going on around the web about Highrise. We’ll be rolling this out to the other product sites as we redesign them as well.

To do this, Sam built an internal app called Extra Extra. Sam will be talking about the technical aspects of Extra Extra next week, but for now I just wanted to show you how it looks and how we use it.

This is what it looks like:

Extra Extra scours the web and Twitter every hour or so for keywords including 37signals, Highrise, Basecamp, etc. It displays matches in a list view. We can then review the matches and select which product sidebar gets which blurb by just clicking the icon.

Some blurbs may be appropriate for multiple sites, so multiple icons can be clicked. You’ll notice the fourth one is selected for both 37signals and Highrise. Once an icon is clicked the entire row turns yellow so it’s easier to spot which ones have already been published. Blurbs that aren’t appropriate are just ignored.

Once an icon is clicked, the item gets published to the appropriate product’s feed. Right now the Highrise site is the only site with the sidebar, but we included all products and the 37signals logo (for the 37signals site) so we can get into the habit of selecting content for those sites too. Once the new sites launch we’ll already be ready with content.

If we spot something on the web that Extra Extra doesn’t pick up we can add it manually by clicking the “Add a news item” button at the top.

How it works on the sites

In the sidebar we pop in a DIV with some Javascript that looks like this:

      <div class="extra_extra_news" count="8">
        <script type="text/javascript" src="http://news.37signals.com/feeds/highrise.js?no_expire"></script>
      </div>

The Javascript pulls the appropriate feed from the Extra Extra app and the count=”8” tells it how many entries to display.

More soon

We hope you enjoyed this little peek behind the scenes at Extra Extra. Sam will be following up with technical details soon and we’ll have a lot more design related posts about the new Highrise site soon.

We’d like to hear what you think about Signal vs. Noise, what you like and don’t like, and your ideas for improving the site. We’ve put together an anonymous survey to gather your feedback.

It’s not too long and all questions are optional, so if you have a moment we’d love to get your feedback. We’re planning on sharing all the responses once we’ve reviewed them.

So please take the survey! Thanks!

At 37signals we sell our web-based products using the monthly subscription model. We also give people a 30-day free trial up front before we bill them for their first month.

We think this model works best all the time, but we believe it works especially well in tough times. When times get tough people obviousy look to spend less, but understanding how they spend less has a lot to do with which business models work better than others.

There are lots of business models for software. Here are a few of the most popular:

• Freeware
• Freeware, ad supported
• One-off pay up front, get upgrades free
• One-off pay up front, pay for upgrades
• Subscription (recurring annual)
• Subscription (recurring monthly)

Cutting new before cutting old

Typically people look to cut new spending before they cut current spending. They’ll often put a freeze on anything they aren’t already paying for. Eliminating new costs is easier than eliminating existing costs.

For example, if they’ve been evaluating something new, they’ll put that evaluation on hold. If they’ve been able to get by without it they can likely continue to get by without it. Or if there’s a big upgrading coming up they’ll stall or just consider it unnecessary.

But if they’re already paying for a service they use, they’ll likely continue using that service. They may downgrade to a cheaper plan, or try to negotiate price, but if it’s still useful there’s a fair chance they’ll continue using it.

The problem with one-off selling

The problem with one-off selling is that once the customer pays you once, that revenue stream runs dry. In tough times, when people freeze new spending, less new customers means less new revenue. And in extreme cases, you may see no new customers at all. That means no new revenue at all. So if you have no new customers for three months, you have no new revenue for three months. If you don’t have reserves, going dry for three months could sink you.

I just recently finished reading “Black Postcards: A Rock & Roll Romance” by Dean Wareham, ex-frontman for the band Luna (review). Great read. I’m a big fan of the man’s music, but I think even non-fans will enjoy his frank descriptions of internal band conflicts, the creative process, life on the road, etc.

It also got to me thinking that Wareham, a smart guy, and his bandmates really did a wise job of exhausting potential revenue streams for the band, while simultaneously making its hardcore fanbase happy.

For one thing, they released a 2006 documentary, “Luna – Tell Me Do You Miss Me,” of its farewell tour. It’s not just a celebratory feelgood flick though. It really takes you inside the disappointments and strains of the band. You don’t often see a band that’s willing to reveal the depressing side of trying to make it as a musician…what it’s like to be approaching 40, touring around in the back of a van, and having people constantly tell you, “I don’t know why you guys aren’t bigger.” Amazon’s summary:

In Tell Me Do You Miss Me, the four members of the celebrated New York-based indie-rock band Luna confront the ceiling of their ambition, the harsh realities of their modest success, and their conflicted feelings about each other as they embark on their final world tour and uncertain futures. Laced with moments of both humor and melancholia, Tell Me Do You Miss Me earnestly exposes the underbelly of a touring rock band in their final days together. Supported sonically with Luna’s dreamy catalog of indie-pop and visually with lush travelogue footage—with adventurous stops in England, Japan, and Spain—Tell Me Do You Miss Me is an elegy for an era.

The book and movie are both surprisingly raw and open. That admirable level of honesty will probably continue to draw in fans (and non-fans) even after the band is gone.

And the DVD landed in stores the same day as The Best of Luna, a greatest-hits CD. Previously, Luna put out a live album too. Both of those are good examples of how a band can make money without having to write new songs and return to the studio. And of course there’s the usual merch stuff like ringtones and tshirts (which was actually the only way the band made money on tour after covering costs).

Revenue is like water going into a dam. The more holes you can poke in that dam, the more ways the money has to trickle through to you. Plus, it gives fans more ways to connect with you and interact with you (especially if you’re willing to be open and honest). When that’s true, everyone wins.

Lead singers aren’t supposed to write books. That doesn’t mean it’s a bad idea though. What are you not supposed to do that’s actually a pretty good idea?

Related:
There’s more than one way to skin the revenue cat [SvN]
Hanson: Still at it and more successful than ever [SvN]

Some recent posts at the 37signals Product Blog:

Highrise
[Case study] How record producer Bill Moriarty uses Highrise to keep track of album projects
“Despite living in the same city we rarely see each other in person, we barely have meetings, we don’t have conference calls, we don’t do IM… Highrise is where everything goes. It’s how Chris & I stay in sync with what was said, what was promised, potential projects, and where I’m currently in an album’s progress. If we worked only in email all these vital communications would just be lost in the email noise. Using Highrise makes us focus just on what’s important to making records and running our company.”

Using Highrise export as an offline backup
“We were recently talking to a customer who occasionally needs to access information in Highrise while he’s offline. His solution: He exports all his data from Highrise every few weeks so he’s got an offline backup on his hard drive.”

Basecamp
How Ice-Qube Preparedness System founder relies on Basecamp
“Basecamp has enabled me to function like a big company, makes the most effecient use of my time, gives me the most information I could want to supervise and access my teams participation, serves as the ultimate back up and makes sense of my wild mind and ultimately grows my business.”

[Case Study] The Vianova Group President on “the ‘less is more’ streamlined eloquence that is Basecamp”
“Reluctantly I set up my first project which was a large-scale fundraising event involving a large and diverse committee of staff and volunteers.  Much to my surprise the entire group began using Basecamp immediately. More importantly, there are significant intangible team benefits to the “less is more” streamlined eloquence that is Basecamp.  My clients frequently tell me how much they appreciate us giving them a highly effective tool that is so easy to use.”

“New Journal of Physics” article mentions Basecamp
Scientist Darran Edmundson, of EDM Studio, Inc., wrote an article for “New Journal of Physics” that includes a couple of mentions of Basecamp.

Multiple products
Backpack and Highrise at Wall Street Journal site
“Tips for ‘Getting Things Done’” is a video at The Wall Street Journal that includes a discussion of Backpack (and screenshots of Highrise) as tools that help you be more productive.

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Recently I scored a practically mint condition Olivetti Lettera 22 from Post 27 here in Chicago. I can’t stop myself from inspecting it in awe daily.

Created to be the quintessential portable typewriter, it’s made of sturdy but lightweight steel, designed minimally and simply. There’s nothing under the keys besides air, no added weight or metal. Even the case it comes in wastes absolutely no space – the bottom piece is flat and flush with the bottom of the typewriter, the top part zipping over in perfect proportion to the machine.

It makes me think of the electronic typewriter my grandmother had in the 80’s, this huge bulky machine that took up half her desk and felt like it weighed a ton. Sure, it probably did a lot more – it even had a WhiteOut laced backspace key! – but how much of that was necessary? Bells and whistles and electronic WhiteOut do a lot to blow the mind, but nothing will ever compare to the most simple, elegant solution.

Talk to someone who runs a successful business and ask them, “When was the last time you looked at your business plan?” Chances are they don’t even know where to find it.

“Three Start-Ups, a Year Later” [NY Times] gives some examples of how little the original plan for a business matters once you’re actually doing something.

Tina Ericson recently shut down her online T-shirt store, Mamaisms Gear, in Wilmington, N.C., overwhelmed by the strains it was putting on her corporate job. “It seems like it was only yesterday that we were discussing our plans to make $100,000 in revenue the first year,” Ms. Ericson said. “We made some very expensive mistakes.”…

She predicted sales in 2008 of $100,000 at Mamaisms Gear, which intended to offer a broad line of T-shirts and other products with “Mama Says” slogans like “Quit Whining.” She also talked about creating a Web site for women and starting a consulting company for the financial services industry…

But by June, with economic growth slowing, all three business owners were scaling back their ambitions. Ms. Ericson had abandoned her plans to create an Internet community for women and to start a consulting firm to concentrate on marketing her T-shirts to boutiques.

The other two business profiled are still alive but have also completely rethought their original plans. They’ve changed focus, services, salaries, partnership arrangements, etc.

Sure, you can blame the economy. But this type of thing is par for the course even when things are going fine. Businesses, like armies, always have to adjust to the facts on the ground. If these companies’ one year projections were so far off, imagine how worthless those year three (or five) projections turned out to be.

It begs the question: What’s the point of a business plan if it’s obviously a fantasy that has nothing to do with reality? If these projections are just numbers pulled out of thin air, why pay any attention to them? Wishful thinking doesn’t really benefit you in any way.

It seems like most people write business plans just because they think they’re supposed to. They’ve been told a business plan is what a “real” business needs so they go ahead and start making shit up. Then reality happens and the whole thing goes out the window.

Sure, thinking about the future can help. But writing it down and thinking it’s any sort of plan is foolish. The truth is you’re not going to know what to do until you’re actually doing it.