What, Me Worry? Fearing Your Company's Permanence

This week the Founders talk about dealing with fears their company could disappear at any moment and what makes them confident that it will be around tomorrow and beyond. They also talk rollerblade chairs, Kung Fu Panda, wrapping up 2020, and the upcoming FounderQuest hiatus! Also, please vote!

Show notes:
Links:

Rollerblade Chair Wheels
FounderQuest Twitter

Full transcript:
Ben:
So, I just moved back into my office after being away for six months, because COVID.

Starr:
I see that.

Ben:
And in the meantime, though, I had all my stuff at home. So I had my podcast setup, I had my monitor, my chair, everything. And while I was at home, I bought these new roller wheels for my chair, you know the ones that look like a roller blade wheels?

Starr:
The ball bearing ones.

Ben:
Yeah, yeah, yeah. And at home I have a normal carpet. It's not shag, it's just standard carpet. But here I have those plastic things you put down so you can roll easier.

Starr:
Yeah.

Ben:
And so at home I didn't really notice much difference on those wheels on my carpet, but here it's really slippery, so now I'm sliding back, and forth, and all around. It's kind of fun.

Josh:
Nice.

Ben:
So, if you want something to entertain yourself, get some of those roller blade wheels for your chair, and then make sure you're on a smooth surface. It's hilarious.

Josh:
Yeah, yeah that's still on my list. I totally want to do that. I mean, I have wheels on my chair now, but it would just be a smoother ride. I feel like I could do some... Have some fun with that.

Starr:
What are you doing? Are you riding in your chairs? What are you doing in your chairs?

Josh:
Oh yeah. You don't like-

Ben:
You got to do something while you're running all those tests.

Starr:
Yeah.

Josh:
Just you can do spins, and...

Starr:
Y'all must have much more space than I do.

Josh:
Bounce off the walls.

Ben:
Next month I'm going to install a half pipe.

Josh:
All right.

Starr:
Well, now I'm only moving my chair around and I'm wondering is it moving easy enough? Do I need a smoother action on that?

Josh:
You need a performance chair. That's right.

Starr:
All right, well before we get started I should make a little announcement. This will be our last episode for a little while. I know I just scared y'all.

Josh:
Yeah, are you trying to-

Ben:
That's scary.

Josh:
... put people on edge?

Starr:
Yeah, for a little while, because, yeah, a bunch of us have leave coming up, and it's just going to be impossible to make it all work. Yeah, and we don't record podcasts while we're on vacation, because that's just, that's bad.

Josh:
And breaks are nice.

Starr:
Breaks are important, yeah.

Josh:
It's good to take a break.

Josh:
Yeah.

Starr:
It'll let our listeners not be tired of us anymore. They'll forget all the things we repeat all the time.

Josh:
Yeah, yeah. I was going to say, yeah, when we come back you'll have forgotten everything we say, and we'll just start from the beginning.

Starr:
Yeah.

Josh:
I think our plan is to come back with some fresh topics, and-

Starr:
Some fresh topics-

Josh:
... fresh attitudes.

Starr:
Oh, really? Okay, well.

Josh:
We'll see. We'll see how the election goes.

Ben:
That's one of the benefits of going on vacation, right? Is get that fresh attitude.

Josh:
Well, I think we'll see. This will be after November 4th, or whatever.

Ben:
Right.

Josh:
It's 4th, right? Yeah so, we'll see how our attitudes are.

Starr:
That's not the reason for this little break.

Josh:
No.

Starr:
But it is a benefit that we just don't have to be on the record.

Josh:
Yeah, listening to own cynicism in 10 years.

Starr:
Yeah, live covering this terrible last month.

Ben:
So awful.

Ben:
Can I just chip in on that for a second.

Josh:
Get it in now.

Ben:
We've tried to avoid being overtly political and stuff, but that made me think again about the stay in your lane comment, that some people like to throw at other people. Like, "Oh, you're a tech guy you should stay in your lane." We talked about this before, but that's just hogwash. We're all people, right? And we all have opinions, and we should all be able to share them in ways that are helpful, and ways that are critical, but ways that are always kind. I don't know. I don't buy this whole stay in your lane, you should only talk about X thing. I think we all have opinions about stuff, and we should feel free to share them.

Starr:
For that to be true it's like the sum of your humanity would be tech guy, which would be pretty sad.

Ben:
It would be.

Starr:
Right?

Josh:
Yeah.

Starr:
It's like all of us are more than tech person. Anyway...

Ben:
Agreed.

Josh:
Mm-hmm (affirmative)

Ben:
Agreed. Sorry, soapbox.

Josh:
Well, I think what we're saying is vote. Please vote.

Ben:
Please vote.

Starr:
There you go. Yeah.

Josh:
I mean, we got to get it in, get our-

Ben:
Yes.

Starr:
We're all just terrified.

Josh:
We're just doing our part.

Starr:
We're literally spending the next, I don't know, six weeks just in our closets. Okay, well. So we just did our Q... What is this? Q4? Q4 Conclave?

Ben:
Mm-hmm (affirmative)

Josh:
Yeah. Final of the year.

Starr:
Yeah, normally, in normal times, we get together in an undisclosed location in a meeting room called the bunker. I'm being serious. And we have a big long all day meeting, in which we hash out what's going to happen with Honeybadger for the next quarter, and so since pandemic started, we've been doing this on Zoom, and so it was spreading out over days, because an all day Zoom meeting would just be like hell on earth. And yeah, so here we are, and we are so... That one went pretty smooth. There are no big changes, we got it done pretty quickly, we got it done in two days under schedule, which made me really happy.

Ben:
Yeah. My wife asked about that. She was like, "So, you doing another day of conclave?" I'm like, "No, we're done." She's like, "What? You're already done?" I'm like, "Well, yeah. This was shorter than they had been in the past." And I was thinking, "Why is that?" And I was like, "Well, our Q4, our plan basically is to try and wrap up stuff, nail down some of the things we've been working on." And there wasn't really any big new initiative, or big decisions we had to make, it's like, "Oh, well just do that in Q1." Right? Right now, it like we're coasting through the end of the year, I think, is the plan.

Josh:
Well, let's be honest. October is basically over. It's basically already November, so we're already halfway through the quarter.

Ben:
Is that pandemic time?

Josh:
I think so, yeah, but I mean, honestly we are, a lot of us are taking time off in October, and we're also probably going to take a lot of time off in December, like we always do. So realistically, we're not making major plans, I don't think, for any huge initiatives.

Ben:
True. True.

Josh:
It was really nice to finish something for the year. Can I just say that? It was nice to say, "This is the last before the new year." I think that we're going to start to get more of those building up, and looking forward to.

Starr:
What do you mean exactly? You mean having this cycle where you start new things, then you work on it, then you wrap it up?

Josh:
No, I mean, it's nice to have something of 2020 wrapped up. It's nice that something in the year is finally over.

Starr:
Oh, I get it.

Josh:
Which is our conclaves, you know? We're starting to where we're heading towards the finish line.

Starr:
Yeah, and we brought a little bit of order in the chaos of the world.

Josh:
Yeah, I need to start on my New Year's resolutions.

Starr:
I really like the idea of a wrapping up loose ends quarter, because it always seems like there's some task on the action items, or thing that we make, where it's important, but it's not really crucial. Like it would be very good to do, but the world isn't going to explode if you don't do it. And so, for me, that's been, for the past year, that's been I want to go in and look at our numbers around our conversion rates, and see if I can find any patterns there. And just do some analysis. And that's sort of thing where nobody's on my case if I don't do that next week, but I've been saying I was going to do this literally all year. And so, it gets kind of embarrassing to just roll over the same action item every quarter.

Josh:
Yeah.

Starr:
So it's going to be nice to just have some time that's just set aside to work on that.

Josh:
That's a good fall task, you know?

Starr:
It is, yeah. It's cozy.

Josh:
Get some tea, and...

Starr:
Yeah, get some tea, get a nice fire going.

Josh:
Tea, and fire, spreadsheets.

Starr:
Crack open the spreadsheets. You're joking, but this is-

Josh:
I know. This is your dream.

Starr:
I love it. Yeah, yeah.

Josh:
Yeah. That's cool.

Ben:
And my wrap up task, we talked about on our last episode about doing the accounts. Redoing how we have the billing relationship to our users, and all that. And that's been something... You talk about having yours on the list for quarters. Mine's been on the list for years.

Starr:
I know, and that's not cozy Ben. That's like Thunderdome.

Ben:
It's going to be a knockdown fight at the end to get that launched, but yeah, that will happen. It is going to happen in October, or else I will die trying.

Josh:
Yes.

Starr:
Yeah. How long was that pull request you did? Like 10,000 lines or something?

Josh:
Oh, Ben's pull request was insane.

Ben:
About 6,000, I think.

Starr:
6,000. Yeah, it's-

Josh:
And it broke my browser. I had to switch to the native app to review it.

Starr:
Yeah, GitHub can display that much code in the browser.

Ben:
And Code Climate added comments. Like, "I gave up, and I can't even review this thing. It's too long."

Josh:
I almost did that but I was like, "I can't do that to Ben."

Ben:
I would have understood.

Josh:
I suffered through.

Starr:
Yeah. Like, "Start this over, do it in smaller chunks."

Josh:
Right.

Ben:
I think this was a third restart attempt, actually. I think I have two. One that just didn't get anywhere.

Josh:
We had a couple. Yeah. Well Kevin, we had Kevin-

Ben:
Kevin worked on it.

Josh:
... start on it, and then.

Ben:
Yeah.

Josh:
Yeah.

Ben:
Yeah. And yeah, so it's going to happen. And I think once it does, I was talking to Starr right before we started recording. I think once it happens, that's when I'll take my vacation-

Josh:
Very good.

Ben:
As a reward for all that blood, sweat, and tears.

Starr:
Let's wait a couple weeks until after you deploy it, before you take your vacation.

Josh:
Yeah

Ben:
So Josh, what's your wrap up task for the year?

Josh:
Oh yeah, JavaScript, and I can't say that this is... The sad part for me is it's probably never going to be off my list.

Josh:
So I'm just wrapping up some things, though, that I've been working on this year, and, yeah, related to our packages and stuff, and I'm not going to go into it in depth, because I feel like I've already done that, and I would just end up ranting again so...

Ben:
Crying.

Josh:
Yeah. But, yeah, we'll, hopefully, make some progress on that. Actually I have made some, this stuff I've been working on this week with some, again, some improvements to our source map system. I think I've actually made some progress that should be a big breakthrough, actually, specifically for people who are using source maps with their JavaScript. I found some ways that we weren't doing. We weren't really fingerprinting in the optimal way, in some cases, so I'm pretty optimistic about that right now. At least for this Friday. Talk to me next week, I don't know what I'll discover. But, I'm feeling good.

Starr:
You know, Josh, yesterday's history, and tomorrow's a mystery. But today, this moment, is all you have. It's a gift. And that's why they call it the present.

Josh:
That's beautiful. I'm going to tattoo that on my forearm.

Starr:
That's a quote from Kung Fu Panda. It's a paraphrase from Kung Fu Panda.

Ben:
I love that movie.

Josh:
That would just be the greatest tattoo response, when someone in the store asks you, "Oh, what's your tattoo? What's the inspiration for your tattoo?" "It's something they said in Kung Fu Panda."

Starr:
Based on the tattoo artists I've known, that would not faze them.

Josh:
No. Yeah, for sure. I mean, yeah in Portland, I'm sure it would be pretty tame.

Ben:
Well speaking of JavaScript stuff, we had a new message in Basecamp this morning, that just got me so excited for next year, because-

Josh:
Yeah.

Ben:
... something's going to happen this quarter, but it's JavaScript related, loosely. And is going to be awesome. So stay tuned.

Starr:
What? I've got to look at Basecamp. Are you just teasing the audience now?

Ben:
Yes, yes I am.

Starr:
Okay, I'm going to go look at it now.

Josh:
Yeah, I need to respond to that Basecamp.

Ben:
It's going to be awesome. I can't wait. And I'm so excited about that message showing up right now, because the goal was to have something done by the end of this year.

Josh:
Yeah.

Ben:
And we just left it, just like, "Hey, hands off, we're going to delegate, and let's see how it goes," and sure enough, it's showing up before the year. So I'm just like, "Great."

Starr:
Oh, I know what you're talking about now.

Ben:
It's amazing.

Josh:
Is this is going to be our thing? This is the reason you come back, right? After our break? This is why you can't hit unsubscribe at the end of this?

Starr:
Yeah, that'll be our cliffhanger.

Ben:
So we have to come back for this.

Josh:
Yeah.

Ben:
So.

Starr:
Yeah, that's going to be game changing.

Ben:
Game changing.

Starr:
If you write games in a certain platform.

Ben:
It's going to be awesome.

Josh:
Yeah. The other big thing that, well, one of the things that, I guess, one of the other reasons, probably, that our conclave was not super long this year is, we also have our other major effort is launching Hook Relay. So that's going to happen, right? It's not going to be like Block Party launch, but I think it's going to be out there.

Ben:
Yeah, that's going to happen. Yeah.

Starr:
Are the rumors correct? Is it going to be ready in time for Christmas?

Ben:
It's going to be ready in time for Christmas.

Starr:
Yeah. All right.

Ben:
No, you know the real race though? The real way on is to see whether Hook Relay is going to launch, or my bathroom is going to be done remodeling before.

Starr:
Okay, I thought you're going to say we're going to have it ready by Black Friday, and I was just going to kiss you.

Josh:
Yeah.

Ben:
Black Friday. Oh well, you know? It's a good goal.

Starr:
Yeah.

Ben:
Although, we had a product update meeting this week, and I got that shot out one of my favorite lines, because we've had a few dates just like, "Hey, it'd be nice if we launched Hook Relay by this date." We've had a few those come and go. And so, I set another date, and I said, "Yeah I'm planting my flag in the quicksand."

Josh:
Again.

Ben:
Yeah again. Yeah, we don't believe in the strict hard deadlines here at Honeybadger. We just smile at them as they go by.

Starr:
Time is a construct.

Ben:
The present is a gift.

Starr:
Yes.

Ben:
You know what I also love from that Kung Fu Panda scene where he talks about that, where Oogway is giving him that enlightenment.

Starr:
Oh yeah.

Ben:
I also love the bit about the peach. He's like, "The peach seed is going to become a peach tree. There's nothing you can do about that."

Starr:
Oh yeah, and then the other guy, Shifu, he's like, "Well I can choose where I plant the peach."

Ben:
Right.

Josh:
So are you saying that Hook Relay is our peach tree? Y'all know way too much about Kung Fu Panda, by the way.

Ben:
It is one of the top five movies ever.

Josh:
It is a great movie. I have to admit it's a really good movie so, I take it back.

Starr:
I don't know my kid went through a Hung Fu Panda phase, so I've seen it five times in the recent past.

Josh:
Mm-hmm (affirmative). Yeah, I know how that goes.

Ben:
It's right up there with The Emperor's New Groove.

Starr:
I haven't watched that one yet.

Ben:
Oh, oh, you have to watch that one.

Starr:
Yeah?

Ben:
Oh, yes. You must.

Starr:
Okay.

Ben:
That is the most quoted movie and the Curtis household.

Starr:
Really?

Ben:
It is amazing. Yes.

Starr:
Groovy. So we had... What was our topic that we wanted to talk about?

Ben:
Permanence.

Starr:
Permanence. Oh, this is-

Josh:
This is a perfect time to talk about permanence.

Starr:
Permanence. Yes.

Josh:
And the future, the uncertainty of the future.

Starr:
Man, we are really just doing all the hits. 

Starr:
We were talking at the conclave, though, about, I think a tweet that Justin Jackson wrote about how this idea of, well, if you can make a deal with the devil and maintain your same growth rate indefinitely over time, would you do it, giving up, obviously, the possibility of doing better? Yeah, and he was saying that, I think, he was saying he would make that deal. So we were talking about it, and we were talking about how this ultimately comes down to how stable do you feel in your business, I guess? How reasonably confident are you? Because that was something that we all felt very heavily earlier on. It's like, "We've got this thing, it's taking off, it's doing well, and that's great," but I remember a time, in the very recent past, when it wasn't doing that. And so, this is probably all just going to come crashing to the ground, and we'll be back to square one. I mean that's the anxiety. It's not based on any rational thing, necessarily.

Josh:
Yeah, and I don't think it really goes away completely. But I think we've gotten more used to it. That's a recurring feeling that I've had, but I think as the more times that I have that fear, and then months go by, and then things are still trending along, I think that mutes it a little bit.

Ben:
We've been fortunate, in that almost every month, we've had positive revenue growth. We've had a few negative months, and a couple of just flat months, but that, to me, is reassuring, right? Because I felt, for the longest time, I woke up every day like, "Oh, this could all end tomorrow," and I don't remember exactly when that went away. May have been some around 50,000 in MRR, I don't know. It took a while. It took a while. But now it's like, "Yeah, I think it's going to last." And the thing that surprises me was, with the COVID stuff, and we saw our own revenue take a hit at the beginning of the pandemic, and people were... Some of our customer's businesses just went away, right? And so like, "Well we're going to cancel." And so we saw a hit there. But even then, I wasn't all panicky like, "Oh, it's going to end tomorrow." Still like, "Well, we've made it this far, Probably going to keep on going." So, but I remember, the early days, that was really, really weighing on my mind, and I think that's the same thing that Justin was saying, in a recent podcast episode that he did, talking about topic, was that that fear was just ever present, and just gnawing, and I guess, maybe the good news is, if you give it a couple years, it'll go away.

Josh:
Yeah, if you want to go listen to that episode later, it's titled The Fear of the Build Your SaaS podcast.

Starr:
Yeah, I'm trying to think of an inflection point there, when that change... And I wonder if the switch to metered billing, and our going through that together, and almost killing each other over it. And I wonder if that cemented our, I don't know, security a little bit? Because it was a super scary thing we've got... Do you mind if I explain this a little bit?

Ben:
Feel free, yeah.

Starr:
Okay, so when we started on Honeybadger, we didn't have metered billing. We had all you can eat errors, which at the beginning, I was like, "Okay. Our people are freelancers, our customers are developers." And when you go to sign up for a plan, like Airbrake before us, they had these plans where it's like, "Well you sign up based on your error per minute rate." And I want 100 errors per minute, so I want the large plan, or whatever. And my thinking was that, "Who the hell knows how many errors per minute they're going to have, right?" Ideally, you're going to have none, but then you're going to have big spikes sometimes, and just yeah, that just seemed so unintuitive to me. So personally I was very in favor of the all you can eat plan. So we did that for many years. And, but eventually, eventually, people started eating too much. We found that-

Josh:
Yeah, yeah. We left the buffet unwatched, and people were just sneaking in and-

Ben:
The NFL football team walked in and started eating.

Starr:
Yeah, exactly. We thought most of our customers were going to be little leaguers, but then we had some, yeah, we had some major league people show up, and suddenly we were losing money. We were losing money on the amount... On how much it cost us to send email to people. We were sending so much email to these people, that we were paying more than they were giving us every month. And so, Ben led the charge to move that, to move us to metered billing. And it was an uncertain time, and we'd been on a long plateau, in terms of growth. And so, we were like, "Okay, we'll try it. Who knows if it'll work? But yeah let's give it a shot." And then, so Ben flipped the switch, and then immediately our revenue just plunged down, because what happened is that we didn't force people onto new plans. And so the only people who moved onto the new meter plans were the people who are going to save money by doing that.

Josh:
Right.

Starr:
Yeah.

Josh:
It's like a big realignment.

Starr:
Yeah it was a big realignment. And I know I was just freaked the hell out about this, and Ben was a bit calmer, and we argued, but we hugged it out, and made friends.

Josh:
I think Ben was sweating over this too.

Ben:
I was totally sweating. Yeah.

Josh:
I think he was sweating.

Ben:
I was freaking out too, but in a different way, because I was so convinced that that was the right thing to do. But the problem was I had just finished this Herculean task of switching all that stuff. And I remember, Starr, you were like, "Uh-uh (negative). Uh-uh (negative). It's time to roll it back. Let's though stop this." And I'm like, "Oh no, no, no, no. We've too far. We can't turn around now."

Josh:
This is like accounts.

Starr:
Yeah, we'll see if accounts work out. We'll just roll this back.

Josh:
Yeah.

Ben:
Yeah. So, yeah, that was intense time, for sure but-

Josh:
I forget, did we send an email that announced the new plans, or did people just find it on their own? Because, I mean, I feel like this would have been an even more drastic plunge if we had-

Starr:
Oh yeah.

Josh:
I remember talking about that. I think we were like, "Yeah let's not broadcast this one, initially to everyone we know, just because..." Yeah.

Ben:
Yeah, and yeah, all the little guys were switching, downgrading like crazy, and all the people that were using it, that we were spending more than they were spending on us, they, of course, did not switch, and so we decided to go... So we realized that it couldn't persist forever. That would be bad. And so we came up with a plan to ask those customers, who were costing us too much, to upgrade to our new plans, and did that over a period of 18 months or so?

Starr:
Yeah.

Josh:
Yeah.

Ben:
We just did a few at a time, because we wanted to make sure that it was working for everyone, and it's a sensitive issue. If you're going to email a customer and say, "By the way, we've changed our pricing, and you know what? You need to switch, and this is why. And, oh, PS, it's going to be a heck of a lot more money because of our new pricing."

Josh:
A lot more in some cases.

Ben:
Yeah.

Josh:
Right?

Ben:
Yeah, a lot more in some cases.

Josh:
Yeah.

Ben:
And those conversations, they have to be handled very delicately, because you don't... I mean, just imagine how you feel on the receiving end of that, "Oh by the way."

Josh:
Mm-hmm (affirmative).

Starr:
I don't have to imagine. I've had Comcast.

Ben:
Exactly. Exactly. But the response was really good. People really understood. I wrote up this huge email, explaining how we'd gotten to where we were, and why we were making this change.

Josh:
Mm-hmm (affirmative). That was an awesome email.

Ben:
Thank you. Everyone was very nice. We had, I don't know, maybe one, maybe two people who were upset. But we just explained it, and like, "Well okay, they get it, right? They don't like it, but they get it."

Josh:
Yeah.

Ben:
But I was really happy with how that went after it was all resolved. Going through it was difficult, but-

Josh:
We had a good track record of, like you said, we've never forced anyone. This was the first time we've ever asked anyone to switch to a new plan for any reason. We always let people keep their current plan forever if we change pricing, and then it's just if you want to change, or it's just new people coming into the business are on the new plans. But, yeah, I think, like in this case, to go back to the Comcast comparison, if the CEO of Comcast personally emailed you, or called you, and explains all the reasons why they're losing money on your account or something, that's that's a lot different than getting some sort of generic broadcast email, or like, "Everyone has to... We're we're changing our pricing. What this means for you." Which is always that it means you're going to pay more money.

Ben:
A bit more.

Starr:
And to, yeah, just to take that a step further, this wasn't actually something we broadcasted. We basically, I went in, and pulled numbers down for all of our accounts, and found the ones that were consuming substantially more resources than they probably should have been on their existing accounts.

Josh:
Right.

Starr:
And they were basically getting a ton of service for pennies. And those were the people that we asked to upgrade.

Josh:
That's the other thing I was going to say, because those people were also much more likely to see the inconsistency there, and appreciate it. Appreciate our position.

Starr:
Yeah, and they didn't actually, since it's metered billing, they didn't actually have to upgrade. They could have just sent us fewer errors too. Right?

Josh:
Right.

Ben:
Yeah.

Josh:
That's the alternative. Some did a combination. They upgraded to a reasonable plan, but then they also cut back some of their unreasonable traffic that they were using.

Starr:
So you might say that, by forcing, or by politely asking them to upgrade, we actually made their apps more usable, and more sustainable.

Josh:
You could say that.

Starr:
We should force people to do stuff more often.

Ben:
I remember in the email, I gave four options for things that they could do. And the fourth option was fix your app, and I put a smiley face on there, right? Because yeah, all you got to do is not send us errors.

Starr:
Just a little wink.

Ben:
Exactly. And some people did that. We had actually a couple be like, "Oh, you know I had no idea," because they never paid attention. They were like, "It throws errors, but I don't care," and they're like, "Oh, I've been sending you millions of errors, and we don't really need to, so we'll just stop that." I'm like, "Oh cool. Perfect."

Josh:
Like those $10 a month Heroku accounts, that would send us... They would be on the top of our leaderboard for the month.

Starr:
Yeah, they're probably paying Heroku more than $10 in CPU costs to send themself errors.

Josh:
Seriously.

Ben:
But that did get us past that plateau, and that, yeah, to Starr's point, that did. After a lot of that transition happened, it did make me feel a lot better about the viability of the business, and seeing that continued revenue growth. I couldn't believe it.

Starr:
Yeah, I mean, it also helped that it actually worked, and revenue growth went up substantially.

Josh:
It worked really, really well. Yeah, I mean, actually, I don't think we can underestimate how much that actually... How big of a deal that was, because I think the more we move into the future now, the more we appreciate the revenue growth from the upgrade cycle. And we did not have that with the feature based plans, where, basically, the incentives were interesting prior to this, because one of the changes, I think we made, when we rolled out metered billing was, before we had one of the things we tiered on were number of projects, right? And I think, so you had a plan that limits you to 10 projects or something. So if you're an agency, you could have 10 clients essentially. So, that was one of the reasons a bunch of the people who were paying us, technically, paying us more on the old plans, switched to the new plans, just because they could remove that limit. But that upgrade cycle, people were not really hitting that limit as frequently as you hit if you actually grow to the point of having more, much more, significantly more traffic. It just seems that's a better cycle.

Starr:
Yeah, that was one lesson I, personally, really learned, is that, if you're trying to drive upgrades in your business, the thing that causes the people to want to upgrade has to happen to them, right? I mean-

Josh:
Yeah.

Starr:
It's like before we were on this thing where we were like, "Okay we'll offer these different features, and people will see that they need this feature, and they'll upgrade." Or like, "They'll see that they want to do another project, and they'll buy a new plan." I'm not saying that didn't work at all, but that happens much less often than if, suddenly, they find themselves having used more resources than they intended to, and oh, they need to upgrade, or cut down on the resource usage.

Josh:
Yeah, that also works better-

Starr:
That puts it in front of them a lot quicker.

Josh:
It works better for everyone, I think too, because I guess the agency example is one example where you might, like the project thing, might actually work, because you get more clients, you need projects. But we have... An agency is one type of customer, then a lot of our customers are just startups, which are only going to have... They're not going to have, probably, the same explosion. I mean, I guess unless they're building with microservices or something. But, I mean, I think that the metered billing thing works, it covers everyone a lot better, because if you're a startup, and say you're just starting out, your traffic is going to be low naturally, but your traffic is going to increase over time as your business grows, basically. So, I think it's a little bit more equal across the different types of customers that we have.

Ben:
The other side effect that was nice was that we got to tie the revenue to our costs. We know that we can continue to scale out and pay for that, because the reason why we would scale out is having more traffic. And having more traffic means you get to have more revenue, right? So, in our situation, having that straight metered billing makes a whole lot of sense on all those levels, and to Starr's point, yeah, if you have this upgrade thing you have to really keep in mind how your customers are using your product, like Josh was saying with an agency, right? If your product is targeted at agencies, maybe it's number of clients, right? Or if, for some reason, you have a lot of customer support, well then maybe you really need to bill based on number of users, because your users are going to be... More users means more support, which means more money out the door on support people. So you have to find a way to recapture that cost.

Josh:
Yeah.

Starr:
Yeah, and you're going to hate me for saying this, but seats, right? It's like, "You hire somebody. Well, okay, we need to buy another seat."

Josh:
Mm-hmm (affirmative). Yeah, that can... I always wish we could make that work, but I don't know.

Ben:
Yeah, I remember-

Josh:
I just don't think that's our style.

Ben:
Yeah, I remember when we had decided on the original pricing, one of the reasons was we just wanted to differentiate ourselves. Starr really hated the idea of the limiting people. And that was something I also felt like the worst thing you can do, when you're having a really bad day with a bunch of errors coming in, is to limit all that error traffic, because that's when you want it, right? But we also felt like it was a way to stand apart from our competitors. They're all doing this, but we're going to do that.

Josh:
Yeah.

Ben:
And that didn't work out so well. We learned that it actually makes sense to do it like everybody else does it, in this case.

Josh:
Mm-hmm (affirmative). So getting back to the topic of permanence. So Starr, you're thinking that this whole episode was one of the things that taught us that the world doesn't end easily, maybe, or something like that?

Starr:
Yeah.

Josh:
You can have a challenge that seems insurmountable, like for us it was our, I think, this was one of our first plateaus in our SaaS business. Which was a major deal, but even thinking back to that, we could not see over the top of that. I think this was almost, I want to say, this was almost like a last ditch effort. Like, "We got to change something major to break through this," which was why I'm assuming you just didn't sign up to volunteer just to change something this big, just for the hell of it. So there was this thing that drove you to do this, but at the time, I remember it being a major deal. Just like, "How are we going to break through this, and reach the level of growth that we wanted to, that we had envisioned for the business?" And I think that goes back to what I was saying earlier where, as your business grows, and you do it long enough, you have more of these points where you have a seemingly major challenge, and then you overcome it. Or you just keep going, and it's not the end of the world, basically. And I think over time, for me, that's helped reduce that fear of something ending tomorrow, basically. I mean, it's always there. There's always risk, but I feel it a lot less these days, I guess.

Ben:
Another way that I've felt this increased permanence feeling is actually related to competitors. Because I remember, for a long time, I had one of these fears in the back of my head was that some big, big money competitor would come into the space, and take all our customers away. And, and then Google released Stackdriver. I think they acquired this company, and then released Stackdriver.

Josh:
Yeah.

Ben:
And it had error tracking as part of it. This huge suite of stuff, like monitoring, and all this kind of things. And I was like-

Josh:
It was kind of an oh shit moment.

Ben:
Exactly. I was like, "Here it is."

Josh:
I remember.

Ben:
"Boom, there goes the business." And it had zero impact on the business. Zero.

Josh:
Yeah.

Starr:
Yeah.

Josh:
The other day we had someone sign up, and they filled out our survey form and they mentioned something about, I really don't want to use, I think it was Stackdriver, I think it was Google, like, "I really don't want to use Google cloud platforms, like off the shelf thing." It was either that or Amazon's, I can't remember. But I thought that was funny.

Ben:
Yeah. So...

Josh:
Yeah.

Ben:
When that happened, and then that fear did not materialize, I was like, "Phew, okay, well, all right. I guess..." And in thinking more about it, even if Amazon released an exact copy of our product tomorrow, we'd still have a ton of customers stick around, even if some of them thought it was interesting, because not everyone loves Amazon, right? And not everyone loves whatever Amazon does, and to be honest, a lot of people love the way that Honeybadger does things, right? That's why our churn is so low, because they just like the product, and they stick around.

Josh:
Yeah.

Ben:
And so, even if there was a big ecosphere change like that, still it wouldn't, at this point, sink the business, which makes me feel better.

Starr:
So do you think that we're like the little mammals, scurrying around, that survive when the asteroid hits?

Josh:
I hadn't thought of that, but that's pretty good.

Ben:
Like a honey badger?

Starr:
Yeah, like a little honey badger. A little proto badger. Because, yeah, because these big changes in the industry, and I'm not saying we're not affected by them, obviously, but I can see them being a lot more impactful if you are a startup, that has received a bunch of funding, and was directly trying to compete in the same market that Amazon, or Google, find significant enough to invest in. But in our little corner of it, it's a pretty small, little, cozy place. And it's not really big enough for Amazon to really worry about, I don't think. And I mean, there's a reason, I think, a lot of our competitors, who are VC funded, have pivoted away from a pure error monitoring model, and are going into application performance metrics, and okay, now they're going to take on New Relic, or now they're going to... I think there's probably a lot more money in those things, it's a lot more interesting to those business-y types.

Ben:
Yeah, it's one of the benefits of staying small, right? If there aren't a lot of mouths to feed, you don't have to have this unicorn success to come out winning, right?

Starr:
Oh, you know what?

Josh:
Yeah, what does the payout need to be, or the payoff need to be?

Starr:
And I just realized, we haven't even said it, but probably the biggest longevity booster is positive cash flow. We've had positive cash flow for pretty much our whole existence, so.

Josh:
Right.

Starr:
Yeah. It'd be a lot... If you don't have a runway, you're never going to reach the end of it.

Ben:
True.

Josh:
Yeah.

Ben:
So, I'm feeling pretty good. So I guess the message is, if you're in that boat that we were in, and that Justin also described, you got that gnawing fear that's making you crazy. Well, hey, if you make it through that, it gets better.

Starr:
Right.

Ben:
If you don't make it through it, your business goes up, goes away, and do something else, right?

Josh:
Yeah.

Ben:
I mean, worst case scenario, you find a new business to start, or you find a job.

Starr:
Yeah, you're not dead.

Ben:
Yeah, probably not dead.

Josh:
Right.

Starr:
Probably not. Well, should we wrap it up on that cheerful note?

Ben:
I like it.

Starr:
All right. Well, we here at FounderQuest are glad that you're not dead. Again, we will be taking a little break for the next, I don't know, six weeks, eight weeks. It just depends.

Josh:
Yeah. Who knows? We'll be back. Don't worry.

Starr:
We'll be back. Don't worry. Just-

Josh:
Harass us on Twitter. You can always harass us on Twitter.

Starr:
Yeah, I was going to say, just like King Arthur, we come back when England most needs us. And, yeah, if you like the show review us on Apple Podcasts. If you want to write for us on the blog, well actually, I'm going to be out, so you can go check out our Write For Us page at honeybadger.io/blog, but it's got a big notice on there saying, "Hey, I'm going to be gone for a while," so don't worry if I don't get back to you.

Ben:
And if you have any podcast episode ideas, topics you'd like to hear about, feel free to hit us up on Twitter. We'll be happy to answer your questions.

Starr:
Yeah, what are we? @founderquest?

Ben:
Maybe.

Starr:
I think we are, yeah.

Josh:
I think so.

Starr:
Yeah, that's one of the benefits of having a marketing person, is that you just don't have to keep all that in your head.

Josh:
Yeah, just search Founder Quest.

Starr:
Just look for us. Yeah.

Josh:
You'll find us.

Starr:
It's okay. It's pretty obvious. All right, we'll see you all later. Have a good one.


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