Ryan Carson of DropSend/Carson Systems

Live Notes from The Future of Web Apps Summit Building a Web App on a Budget: How we built DropSend. Small companies and freelancers Why it's important: You don't have to be big anymore. Much cheaper to do things now without gigantic investments. Broadband is widespread. People comfortable with web apps. Hardware is cheap. Open source is cheap. What's enterprise? Mass market or 1000+ users. Capable of handling a large amount of users. Under £30k. DropSend, enterprise and on a budget. Sending and storing large files. 9.5k users in 2 months. 5 Servers co-lo at 365 Main. Desktop apps which use API (not yet public API). PHP, AJAX, MySQL. The most important thing? Make sure idea is financially viable. Use common sense - would you actually pay for it? Be cautious about projections. Be pessimistic, then assume 65% of that. Will you survive? Aim for profit, not acquisition. Acquisition is a fantasy not a reality. Forget the 'new bubble?' stuff. How much we spent. Set a budget. Diff budgets for diff apps. Branding & UI £5k. Development £8.5k (smalll equity stake for developer). Desktop Apps £2.75k. XHTML/CSS £1.6k. Hardware £500. Hosting/Maintenance £800 per month (BitPusher) for 5 boxes. Legal £2630. Accounting £500. Linux specialist £500. Misc £1950. Trademark £250. Merchant account £200. Payment processor £500 setup. Total £25,680. Cashflow - have a side business to bootstrap and fund idea. How to get and stick to a budget: 1 year to save the cash. If it takes time it's ok! Building a team: Quiet talent, not rock stars. Offer equity (2-5%). Ask friends for recommendations. Outsource - tried India, didn't work for us, might work for you. Scalability on a budget. Enterprise has to scale but you can't afford it. Buy just enough hardware to launch. Wait to see if you're successful before you spend lots. Build scalability into the architecture. How does app handle running out of disk space? Plan but don't obsess. Keep it cheap: Don't spend money unless you have to. "No stationery - we wasted £1k. Dumb." No new shiny machines. No luxuries. No froo-froo features. Cut right back and launch quickly with very few features. Makes product simpler and easier to use in general. Before you spend £25, check yourself. Make deals, give equity, barter services or advertising (on blogs). Use IM, not phone calls. Do as much as you can yourself (did wireframing, marketing, testing, book-keeping, copy writing. Get friends to help (usability testing). Shop around (first quote was £12k month!). Pessimism has it's place: You'll go 10% over budget and 3 months over schedule. Plan on it and update your cash flow. "Holy crap! Lawyers are expensive". Terms of service £1k, Contracts for freelancers £800, privacy policy £15 (clickdocs). Barter! Free one-hour consultation. Cheap software is your friend. Basecamp, Trac for bug tracking, Skype & AIM, Subversion for version control, LAMP Cheap hardware: £200 Linux box for dev server on own broadband. Marketing: Blogs, Word of mouth, viral qualities to app where it makes sense, writing (great way to raise profile - mags in your customers sphere of reference). Venture Capital? Might need it if you need to scale/expand quickly, you can't wait a year to save cash. You need a solid reason to go the VC route. Why give away 25-50% if you don't need to? What we learned:

• Don't spend money unless you absolutely have to
• Bring down costs by bartering
• Cut features
• Be realistic/slightly pessimistic about your cash flow
• Plan for scalability but don't obsess

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