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Wow. Just wow.
It's hard for me to believe how much has happened in Balsamiq-land in 2009.
I feel like a completely different person than when I wrote the "A Look back at 2008" post, just 12 months ago. In a way, I am a different person, and Balsamiq is a completely different company as well.
In this two-part post I'll first look at what happened in 2009, then share some of our plans for 2010, which we are beyond excited about. 🙂
Mockups has definitely come a long way in 2009, but we like to believe that it's still the simple and focused tool we set out to build from the beginning.
Number of official releases: 48
As planned, we released almost every week, sometimes even twice in the same week...we also had a few "secret" releases to fix bugs before anyone noticed. 🙂
We are happy we kept the weekly schedule, as it allowed us to fix bugs quickly and showed our customers our commitment to the application.
The drawback of releasing this often is that it makes it harder for us to work on bigger, tougher features. Since we have a few of those planned for the near future - see next post - we might slow down the pace for a little while...maybe to releasing every other week, we'll see what feels right.
I also have recently realized that updating every single week might be more than most people have an appetite for. We don't want you to feel like keeping up with our releases is a job, know what I mean? What do you think?
Here are some of the major features we released this year:
Links! The no.1 new feature of the year was the ability to link mockups together. It's a good feature - no, it's an essential feature - but it's one that I didn't really want to do for a long time for fear it would change Mockups entirely, and one that took me a while to fully digest. That's why the initial release of it was a bit rocky, it took a few iteration to get it to a point where it was really usable. And guess what, we're still tweaking it, and we're not done either (we need to improve how we position mockups while in full-screen, for instance). In retrospect, we needed to include our awesome community earlier in the process for this important feature...I wanted to make it come out with a bang, which was a big mistake. That's when I learned that long-term value trumps any short-term marketing scheme.
Zoom! Probably the other biggest feature we released this year was zoom and pan. This was a direct result of having someone other than me in the code-base: the coordinate translation calculations required for zooming is one of those things that scare me (not sure why, it's irrational), so I was planning on postponing this feature for a while. Luckily Marco had no such fear: he jumped in and had it done in no time. Unfortunately, my excitement about getting this awesome new feature in the hands of our customers made me jump the gun and release it in a bad state, but we fixed it all up in a couple of hours in the end (see below).
Mockups for FogBugz! The other major release of the year was Mockups for FogBugz, Marco's first back-end integration project. We are really pleased with how it turned out and it's selling very well, both the on-premise and the hosted version.
In Mockups for JIRA, we got rid of the annoying watermarks and replaced them with a 30-day trial. We added the Personal (3-editors) license level first, then switched to full user-based pricing, which is more fair and flexible.
In Mockups for Confluence, we added the 3-editor and 10-editor license levels and added support for linking mockups together, which is super-cool.
Other big features, specific to Mockups for Desktop, include the ability to export all of your mockups as a multi-page, interactive PDF, more native menus, the semi-secret but awesome "DropBox integration", the Open Recent menu, the switch from Comic Sans to Chalkboard on OSX, a new application icon and a cleaner application skin in general. We also added support for pasting images into a mockup and a way to reuse common images via the project and asset folders.
Some other editor enhancements worth noting are:
We made hundreds of other changes and bug fixes, if you have a few hours to spare you can read our Release Announcements blog posts for the year for all the details.
There's still a lot to do before we can even say that Mockups is "implemented to vision", a milestone we think we'll hit late this year. I'll blog more about our "Grand Vision" for Mockups soon, I promise.
As stated on this blog post from 12 months ago, my goal for the year was to hit $400k in revenue, with a stretch goal of $500k. Well, once again I was reminded about how bad I am at forecasting financial results. 🙂
2009 Gross Revenue: $1,626,528.93
That's over 4 times my 400k goal and over 3 times my stretch goal.
To say that we are blown away by this success is a huge understatement, I never thought a little app like Mockups could bring in these kinds of numbers...and in a recession!
It's simply awesome...we are literally in awe, every day.
2009 Profits: $1,139,919.59
We were able to maintain a 70% profit margin even as we went from 1 full-time employee to 3, which I'm really happy about - gotta stay scrappy! 🙂
This also means that we are very well positioned for the years to come, with money to invest in the company and a solid little cushion in the bank to keep us going even if - God forbid - we hit a rough patch in the future. I love it.
Here are a few charts for your enjoyment. These all show data since we launched, 18 months ago:
Those are some sweet charts, I can't believe they're OUR charts! What a ride!
The feeling is the one of being strapped to a rocket, trying to hang on and somehow attempting to steer it a bit by shifting my body weight to one side or the other. 🙂
Sales seem to have stabilized a bit in the last 4 months, which is a nice break while we prepare to scale up more - though it could also be due to Thanksgiving and Christmas holidays, we'll see what surprises January brings... 🙂
The biggest change of the year, of course, was Marco joining in March and Valerie in May.
Looking back, it's funny for me to read the end of year post for 2008, with all those "I"s in there. First of all, I should have already been using "we" since Mariah has been helping out with design and support since 2008, but I guess 12 months ago Balsamiq still felt like "my little baby". That feeling is now totally gone, replaced by "wow I created this MONSTER-baby that now requires 3 people to tend to it full-time, with some part-time help as well! Argh!" 😉
It seems so obvious now, but I have no doubt in my mind that Valerie and Marco were essential to our success in 2009. When I started Balsamiq I thought I would go at it alone for years...I was really scared at the thought of hiring anyone, and I didn't expect this kind of success, by far.
Both in Marco and Valerie's case, I waited until it became clear as day that if I didn't hire someone quickly, I was going to hurt the company. In both cases I just woke up one day and KNEW that the time was right.
I also knew right away that Marco and Valerie were exactly the right people, and consider convincing them to join Balsamiq my biggest personal achievement of 2009.
I feel really blessed to work with such awesome individuals, sharing this adventure, learning together and from each other, every day. That's really what it's all about. I am so thankful.
Speaking of awesome people...the community that formed around Mockups feels like a huge group-hug, every day. We are so lucky to be surrounded by such smart, kind and supportive people. Michael, Adam, Mark, Jenny, Leon, Enrico, Vitorio, Theresa, and countless others. We are so lucky to know you! 🙂
To support the community we started off the year by launching MockupsToGo, which has been a big success (84 posts, 222 subscribers, 290,000 page views). It's so awesome to see the widgets you come up with! In 2010 we plan on making the MockupsToGo stencils more easily embeddable in the app, stay tuned for more.
Together we designed some of the most important features of Mockups, like linking, zoom, the UI library position and others. In 2009 I have learned that we simply MUST involve you in the feature design right from the beginning, or it won't come out right. Thank you so much for helping us with your use-cases and insight!
Later in the year we released a version of Mockups designed exclusively for UX trainers to use in workshops, which is starting to get some traction. We'll try to push it some more in the new year: whatever we can do help UX professionals in our shared quest to rid the world of bad software is a good investment in our book.
Last year also saw the beginning of a community of 3rd party tools that integrate with Mockups, starting with the WebOrb exporter by MidnightCoders, the excellent BMML to Image Maps converter by Vitorio Miliano, the BMML import feature of FlairBuilder, and of course Napkee, "Balsamiq's perfect companion." 🙂
We are thrilled with these efforts, are doing whatever we can to support them (we built the "custom properties" feature just for them, for instance) and would love to see more. Next year we plan on providing more APIs to allow easier integration with other back-end systems...see the next post for more info.
Last but not least, I estimate that we donated around $1M worth of our software to do-gooders, non-profits and other worthy individuals. It's our small way of making meaning, and we're proud to do it.
In 2009 we attended a few great conferences. We had our first little conference booth (at Atlassian Summit, which was a blast), and we also sponsored LessConference and the iPhone Camp Bahm.
I was fortunate enough to speak at the Atlassian Summit (video: one and two), at WebExpo in Prague and at Red Gate in Cambridge, UK for the Springboard startups. Valerie attended and spoke at AtlasCamp, and Marco attended The Business of Software in San Francisco, where we also threw a massive meet-up / after-conference party (with the generous last-minute help of Atlassian).
I am looking forward to speaking at a few more conferences this year - I am confirmed to speak at the Business of Software 2010 conference in Boston (can you believe it? me neither!) and I'm hoping to get confirmed for FOWA London.
We have also been sponsoring the excellent Wireframes Magazine, as well as supporting groups like the Product Group in NYC, the Find Invest Grow and TechStars incubators, the Founders Institute and a few others.
I am looking forward to sponsoring more events, blogs and podcasts next year. But before you email me with a pitch, know this: our policy is to only sponsor things we love, things we want to make sure we can keep reading / listening to / attending in the future. In other words, we will find you, not the other way around. You just focus on being "so good we can't ignore you" and we'll come knocking. 😉
A new thing for the year is that you can now subscribe to this blog via email, or even listen to our best posts as a podcast, provided by the cool new Hear a blog service.
Here are the posts from 2009 that got the most attention:
Twitter continues to be an integral part of our daily lives, and our usage of it is constantly evolving as we all learn more about it. The introduction of Twitter lists now tells us who we are in the eyes of the Twittersphere and allows us to show you a view of our whole competitive landscape, as well as what we consider to be essential startup tools. Even our Twitter background (below, click to enlarge) has received some nice praises, so thank you!
If you live in Facebook, you have to thank Valerie for taking over our little page there: http://www.facebook.com/balsamiq
We now have over 1,100 fans, and use the page to share and discuss topics that are more informal than what we'd share on this blog, as well as release announcements, etc.
We're still figuring out to best provide value to you via Facebook, so thanks for helping us along the way! 🙂
In 2009 we started to dip our toes in different sales channels for Mockups.
For instance, we decided to sell Mockups for FogBugz both as an on-premise plugin, purchased once with an optional yearly maintenance fee (just like we already did for Confluence and JIRA), as well as a monthly subscription, using Spreedly as a payment processor.
On the Atlassian side, you can now purchase Mockups for Confluence or for JIRA directly from us and install it on your servers, or you can purchase it via a few selected Atlassian resellers, or you can purchase it from us and then install it on your Confluence or JIRA server that Atlassian hosts, or now even just purchase it as a monthly subscription on top of your Confluence or JIRA hosted package. In other words, you have lots and lots of options! 🙂
Each of these different ways to charge for our product has its pros and its challenges. One of the first things we're working on for 2010 is a nice "Which Mockups version is best for me?" wizard, to help you buy exactly what you need.
We are learning a lot from these different sales channels, and are happy to support them all for now. I am looking forward to learning a lot more in this area in 2010, as we expand to support more platforms, more resellers and start looking into affiliate programs.
Oh, 2009 should also be remembered as the year we stopped writing invoices and quotes manually in Word - we are happy Freshbooks customers now.
We also had to cave in and get a fax number - we use MyFax and are happy with it so far.
My, it seemed that 2009 was the year of new wireframing tools. Someone even complained that we're drowning in them!
In just a few months Mockups went from being this quirky little new tool with a scrappy, never-seen-before hand-drawn interface to being "the gold standard", the one to beat.
Mockups is even required knowledge for certain jobs, which is hilarious given that it takes about 3 minutes to learn! 🙂
I really didn't expect this transition, and while it's a nice feeling, it's going to take me a little while to get used to this new role. Like Val says, it's easier to get to the top than to stay at the top.
We don't pay too much attention to our competitors - we'd rather spend our time on listening to our customers and giving them what they need - but from what we've seen a number of our features have been included in other tools, which is very flattering. 😉
It doesn't look like any other tool in our same price-range is gaining much traction, but even if they do, if we continue to focus on usability and customer service, I think we'll be fine.
We're always on our toes though...remember Friendster? Yeah, we don't either. 🙂
In general I am very pleased that so many people are trying to help others build more usable software...the more the better! 🙂
The Internet is a big place, there's plenty of room for multiple players. We know Mockups is not for everyone, and that's totally fine.
If you'd like to get a sense of the competitive landscape we're in, follow the tweets from all the wireframing tool makers we know of via this list: balsamiq/wireframing-tools.
Before we go I'd like to reflect on some of the mistakes I've made this year, or at least the ones I have identified as such - I might be making more that I'm not even aware of right now! 🙂
A really broken build: this was the most "visible" mistake of the year, when I published a bad build and left the house right after it. We were able to fix it in a couple of hours but now that we have so many customers, even a couple of hours can cost us. Here's my apology - look at the comments to get a sense of how great our customers are. 🙂
Accountants: this year I learned (through stressful mistakes) that finding accountants and lawyers who have the exact experience you need (in my case both international taxation experience AND being bilingual Italian/English) is both extremely hard and extremely important. Also, if you're a founder of a startup that has all of its employees in the same country, don't come to me wining about bureaucracy...you got it easy my friend! 🙂
Setting wrong expectations for the Web App: right, the web app. That's been "the other thing" that we've been working on all year, our "next big thing" that's been in private beta for a few months now. The mistake I made about the web app is to not realize that with all that we have going on, we'd really only be able to dedicate tiny amounts of time to it. We've been working with an external contractor on it for a while - and it's really very close to where we want v1.0 to be - but without having at least one person dedicated to it in-house, and zero revenue, it's been hard to justify investing the time on it. I guess I thought we'd have more time. We are fixing this staffing issue very soon, and are very eager to get the web app in your hands early in 2010. It won't be perfect, but it will be a start, and I consider it a key part of our strategy in the future. Thank you for your patience on this one, and sorry for promising earlier releases. We live and learn.
OK, this has been an epic post, I'd better publish it so that I can get started on part 2, where I start thinking ahead at 2010. Lots to share there! 🙂
Peldi for the Balsamiq Team
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Yeah, Peldi, I’m terrible at forecasting financial performance too. Really cool to see you blow even your stretch goal out of the water. Your profit margin is just incredible, too. Really a sight to see and to motivate other people who want to startup a business. Congratulations.
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Inspiring results indeed, Peldi! Way to go!
And I’ve never seen such an open approach to declaring in public your financial results. You are completely transparent which makes your company even more cool to watch thrive and prosper. You and your amazing team deserve it!
All the best for 2010! 🙂
Do you have any books, or reference materials that you would suggest for a startup? Seems like you have gone through it, learned a lot of stuff. I have just started going through your blog posts 1 by 1 and they are insightful. For instance I would love to know things like what you use the accountants and attorneys for, what did you use before you had their services, etc.
Good information, you should write a book but you obviously don’t have the time! 🙂
[Peldi: Hi Eric, try this: http://www.balsamiq.com/blog/category/books/%5D
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Great story and thanks for sharing all of the information. This helps those who are looking to start there own thing see that if they have a good idea and a solid product you really can build a business in this new information age!
Great work! Its an inspiring tale of focus and dedication to deliver a great product and a great service.
Keep up the good work.
Congratulations, Peldi! Keep it up! You’re a huge inspiration to many aspiring developers hoping to build start-ups. 🙂
Amazing. Simply amazing. Congrats on all the success.
I love the candor with which you share the results so far. It is really inspiring.
With all the candor, i.e. especially with the financials, what changes have you experienced (with respect to others) ?
Considering that now you have a decent amount of cash in the bank, from the boom in sales, what would you consider being the downside to being so transparent? I would think that there would be more people asking for handouts. If that is the case, how have you handled that and would you say the benefits of the upside vastly outweigh the downside?
Also, what is the upside (aside from the obvious buzz-building) ?
P.S. Congrats on all your success, by the way.
[Peldi: Hi Marc, no big changes so far, but we’ll see! Ask me next year! :)]
Amazing! Cheers and hope you do even better in 2010!
Impressive and inspiring results. Well done.
I have a question about the monthly revenue and profit graphs. They seem consistent for most of the period except for October to December 2009 where there is a small decline in revenue (roughly $15k) but a pronounced decline in profits (about $40k). I guess that means there was a particular non-recurring expense that hit you in December. So I guess my question is, what kinds of non-recurring (perhaps unforeseen) $25k expenses should we look out for?
[Peldi: it wasn’t an unforeseen expense, we just gave ourselves big Christmas bonuses since 2009 went so well]
Congrats on all the success!
It reaffirms for me personally, my taste in entrepreneurs. I wish there were a public market for investing in people, because I would have definitely bought your stock (and clearly, it would have been a wise investment).
Dinner’s on me when you’re in Boston (not only am I speaking at BOS2010, I live here too!)
In a world where there are more commentators than players – you’ve stuck to your guns and did what you believed in.
Hat’s off Peldi and the Balsamiq team.
Now you’ll have all the commentators/experts telling you what to do with your reserves 🙂
Beautiful. Well done.
Well done guys, we use balsamiq at my web agency, and we love it.
So glad for your success, it’s very inspiring.
Keep up the good work!
So happy for you all. Congrats!
congrats on an astounding year, Peldi. and thanks so much for being so transparent about your business – it’s helpful and inspiring for other micro ISVs 🙂
Nice one Peldi, you’re such an inspiration. Hope we can catch up at FOWA this year!
Congratulations Peldi and Team Balsamiq! Your product is outstanding and the effect on your revenue is an amazing validation of that. Inspiring!
Wasn’t FOWA London in 2009? It’s Miami in 2010. http://events.carsonified.com/fowa/2009/london
[Peldi: I think they do two a year, but I’m not 100% sure]
One of my personal values is Transparency. This post is my new favorite to demonstrate that value. I love it and it helps me engage with the company and increases my loyalty. Wonderful.
Congrats on a great year!
Your link for Tools We Use for Running our Startup is not correct.
[Peldi: fixed, thanks!]
What a year!
1. Wall Street Journal doesn’t have business articles as good as this (and certainly not comparable data).
2. My wife asked when we can buy Balsamiq stock. 😉
Congratulations Giacomo and Balsamiq. Stunning results. Great example for the rest of us as well – to keep us motivated. Keep up the good work.
Congratulations Balsamiq! Your success gives more motivation to all small software development shops!
What an awesome, awesome year. And, you’re really doing the community a service by being gutsy and publishing all of this data.
Just imagine what 2010 will be like!
Good job, Peldi et al! You’re an inspiration.
Keep doing what you are doing, mostly 🙂
As Geir says, I don’t know why rapid-fire small releases should harm your ability to (at the same time) work on larger features.
If you are going to keep to even a fortnightly release schedule, *please* get auto-update working – it’s a bit of a killer that I can’t confidently use a new feature in a mockup because I need to first email the other people who might edit it to remind them to update Balsamiq.
This is the sort of thing AIR can look after for you …
Congratulations on a great year!
We’re a somewhat in the same situation: Small company focused on lean product development. We are aiming at perfecting continuous deployment before scaling with many customers, and we are prepared to exercise the discipline that goes with it.
I’m impressed by your 48 releases, and I’m curious as to your remark : “The drawback of releasing this often is that it makes it harder for us to work on bigger, tougher features (…) we might slow down the pace for a little while … maybe to releasing every other week, we’ll see what feels right.”
I think you will see that this problem seizes to exist if you formalize your branching-discipline in your Configuration Management system (i.e. SVN).
Short story: Feature is longer than a release cycle = branch out. Keep branch synchronized to changes in main trunk at all times (minimizing chance of conflicts), but not the other way around, until done. Then merge.
Please do not quit your winning streak. If anything, release more often! Aim for continuous deployment. Good luck!
Congratulations on having surpassed you wildest expectations. I go back to when we bumped in to each other on your return to Italy and the whole adventure started. Plus the passion and love involved make Balsamiq a perfect business model to be studied in the best business school’s worldwide!
(and great post btw :P)
Congratulations! I hope you have an even better year in 2010!
Congrats. I’d be curious to see your face in June when you’ll receive italian taxes (your company is italian, right?). I’m just a consultant but I’m seriously trying to move elsewhere because of this. Anyways congrats again for your accomplishments!
Great to see how you make your dreams come true following your passion.
Have a great 2010!