Review 2013/2014 Pt 2 — The Good, the Bad and the Unexpected
The past two years running Karman have had their fair share of highs, lows and surprises. We try to enjoy the highs and learn from the lows but the surprises make the best talking points. I’ve tried to capture some of that adventure in this post and just maybe there will be some useful information in there for others. If you missed Part 1 from last week, be sure to check it out.
What Went Well
The Work we Did
For a couple of developers who bootstrapped Karman just two years ago, we’ve worked on some incredible mobile projects. We have been fortunate in that our clients have put a lot of trust into our little company. We always knew we were up to the task but with little to no portfolio, establishing that confidence wasn’t always easy.
To the clients who trusted us we are incredibly grateful. We never would have thought that after just two years we would have contributed to such high quality apps as Hubbelville and PCH Cash Slots. Not to mention leading the tech and delivering all of the dev work for the Funny Fables Series and Tiki Rush.
Aside from the case studies on our site and work featured in our portfolio, we’ve had the opportunity to work on countless other smaller and white-label jobs. It’s been invaluable for us to integrate ourselves into other dev teams in order to learn their workflow, pain points, as well as meet fellow professionals. In a number of cases we’ve been able to suggest improvements which help improve a team’s effectiveness or a product’s experience. Sometimes, a little outside perspective is just what a team needs. Making an impact on a well established and talented group is always an incredibly satisfying experience.
Our Outlook
When you found a business part of writing the plan involves projecting your first five years of revenue… Soooo, do some research, pull some numbers out of the sky that look reasonable, and make sure they are greater than your expenses (otherwise you’re in for some trouble). Our projections assumed we would be booked at 50% capacity for the full year. Seems reasonable right? We figured that in a two-person company at least one of us would always be on a job. Well, flash forward six months and we were way behind schedule….like 40% behind where we should be at that point. So we assumed our original projections were too lofty and prepared ourselves for a longer haul towards our five year goals. New work was taking much more effort to land than we had expected. Then the next six months hit us like a train.
The relationships we had cultivated earlier in the year and longer pitches started getting back to us and we were winning them! By years-end we came in just over our original targets and set our sights nicely for 2014.
Coming into 2014 hopes were high and we were optimistic that we could maintain the volume of work from the end of 2013 throughout the entire year. We increased our revenue targets accordingly and got down to work. As we made our way through 2014 we were surprised to find that we weren’t matching our monthly revenue from late 2013. However, we were still doing much better than the same time the previous year so it wasn’t all doom and gloom. It may be too early to say but it seems there are pronounced seasonal peaks and valleys to our line of work. One year of data isn’t enough to claim that we’ve found a pattern, only time will tell if our observations are correct. In the meantime, we do what we can to prepare for slow periods from the years before. We figure that it is best to play it safe.
Being Cautious
Jon and I are careful by nature but we are trying to strike the balance between being careful, but not too careful. We’re building a business that focuses on slow growth, as needed, and quality both of work and life. We aligned ourselves with lawyers and accountants before we had contacted our first client. We drafted up template non-disclosure agreements, statements of work, and services agreements before we landed our first job and we figured out our accounting software before we sent our first invoice. Our attitude has always been that if we’re going to do something, we’re going to do it right. We never want to be in the position where our business reaches further than it’s capabilities. That said, we can’t dwell on doing everything perfect the first time. We’ve done a good job pushing through our discomfort when required but it’s definitely a conscious effort.
Our Fantastic Tools
We use some great tools internally. Part of the fun in having a small business is that changing tools is relatively painless. There’s no need to educate and sell multiple teams on the benefits of something new. Since we’ve had a chance to test a lot of what’s out there I’d like to share some of our favourite tools these days. All of these products are super cheap (if not free) and should last us up until we grow beyond ~five employees:
- Dreamhost — bug tracking, SVN, dev site hosting, etc. Our SVN repos get pretty big and Dreamhost’s unlimited storage is the perfect option.
- Google Apps for Work (was free) — Email, Google Drive, Google Calendar, etc. We’re still on the free version since we’re under 5 users.
- Toggl — Per project and resource time tracking. We’re still on the free tier of this but will definitely pay for it when the time comes.
- Texture Packer — If you’re not using this to create texture atlases you’re doing it wrong. It can even export sprite sheets with CSS for the web! We purchased licenses but it is possible to get by without.
- Advanced File Renamer — Never rename by hand again. If there is some file name pattern you need to achieve this the tool that will get it done. I still can’t believe this is free.
- Checkvist — ToDo list tracking. This is where we keep all of our action items in order and bug tracking for small projects. We’re still using the free tier and get by just fine with some clever use of tags.
- Rooler (Win) or xScope (OSX) — Make sure a designer never calls you out again for being 1px off. Rooler is free and my favourite. xScope is a little overkill but the ruler get’s the job done.
Note: In the interest of transparency, many of these links are referral/affiliate links and will give us a kickback if you sign up through them. In many cases you get a discount as well. More money for everyone right?
What Could be Improved
Do You Even Know Us?
Our presence. We’re developers at heart and love the warm glow of our monitors but we need to take more time to get out, talk to new people and reach outside of our bubble. The times we did go out we weren’t always making as much of an effort to seek out new people as we should have. We need to go meet more people, find out who knows who, how they’re getting things done and who needs help.
Aside from making real life connections, we’ve started building up our social networks. If you’re following us on Twitter, Facebook, LinkedIn, or Google+ you may have noticed that a post has been going out at least once every day. Thanks to the help of our social media manager, we’re working on promoting our posts and improving our social presence. We’re working hard to cultivate an active network so that when the time comes to release our own IP or launch a Kickstarter people will know.
Note: If you have been following us, I’d love to hear your feedback on the content and frequency of our posts. When you see one of our posts we want you to go “Oh cool!” and either click on the link or look forward to our next post. We want to avoid spouting generic industry info like, “People play games on smart phones” and “Millennials are getting jobs”.
Contractors
To be specific, our contractor selection process. There was a period where the amount of work coming in caught us off guard and rather than turn down work, (which we’re all told time and time again to never do) we scrambled to find new talent to help us out. Our success rate of finding contractors was about 50% and while, not bad we quickly encountered the problem of what to do when a contractor just isn’t working out on a client project and you have no extra resources to back them up. When this happened, Jon and I, with the help of some very talented and close friends (with fulltime jobs), had to complete the work in order to save the project. However, saving these projects came at a cost. Sales stalled, 20 hour work days were had and we used up a lot of one time favours. None of our projects failed but those were tense times in the office. A crazy crunch like that was a serious issue and avoiding that issue was a major reason why we founded Karman to begin with. If we wanted future employees to trust that a work-life balance was important to Karman, we had to make sure that didn’t happen again.
The first thing we did, once we had the chance, was revise our contractor ramp up process as well as our communication standards/practices. For example, we now pay contractors to complete a test project which is modeled after previous client work complete with twists, turns and last minute requests. While the test projects come at a significant cost, they give us a chance to evaluate new contractors, set expectations and start to form a working relationship. We also stepped back and turned down some work in order to ensure we could maintain our high standards of quality and communication with our clients. With the new plan in place I’m happy to say that we’ve already seen increased success from our contractors and a reduced amount of overtime for us.
On that note we’re currently looking for at least 2 contractors/freelancers who do so full time (no night and weekend warriors) who are skilled in either Mobile (Unity, Cocos2Dx, Native) or Web (HTML/JS). Our opportunities are out pacing our availability and we’d like to be able to say yes to more of that work. We treat our contractors very well, come see what it’s like to work for other developers who understand your needs, shield you from crazy or ambiguous requests and can sell work to get you paid on time.
The Blog
The blog…yes this thing. Everybody wants one, nobody wants to write for one. It’s been over a year since we’ve updated ours and frankly it hasn’t been detrimental in any obvious way. Jon has a great series of technical posts in the wings and maybe I’ll get around to writing a couple of my own. It’s hard to find time to write posts. I only managed to finish this one (after starting in January!) because I had a five hour layover between flights in the Oslo airport.
Unexpected Turns
Type of Work
When working at our previous jobs we always heard stories of the lucrative banner ad work for developers. We expected to start with small-time banner ad work and slowly claw our way up to microsites, games, and stand-alone experiences. Turns out that banner ad work isn’t all that common (or at least not as common as it once was). It appears that, for developers this niche market has pretty much dried up. These days, the simple banner ads are being done completely by designers (my god they’ve learned how to code) and the more complex banners are being done either in-house at ad agencies or by established studios who are already on preferred vendor lists. That said, I’m sure there is money out there to be made doing banners, but for us it just wasn’t as easy to pick up as we thought it would be.
To be fair, we’re not complaining, not at all. We’re very happy with the types of work we’ve had the chance to be a part of over the past year. We managed to jump right into microsites, games and standalone experiences. We were lucky enough to make some outstanding connections at just the right time with people who were willing to work with a brand new company. But more on that later.
CYBF & Mentorship
The CYBF (aka Futurpreneur) provides some incredible documentation and resources to help you think about your business and write your plan when starting up. However, like many government programs, the amount of money vs. the time investment required is a close call. For us, it wasn’t worth it. For more detail on that check out the Financing section of our previous post.
Part of our financing conditions included mentorship. The mentorship has been great but it wasn’t what we expected going in. Jon and I expected that a mentor was someone who would kind of tell us what to do and how to be successful. In actual fact, as owners, we’re the only people who know the specifics of our business. In reality, the value of our mentorship has been in more of a general support role.
There are so many nuances to the way our mentor has helped us, it’s difficult to qualify them. The few qualities we are able to express are:
- Sounding board; our friends and family are only so willing and able to listen to us talk through some of our challenges and frustrations. A mentor is interested in how your business works and have heard from you regularly so they understand where you’re coming from.
- Outside perspective; We live in a bubble when it comes to our own operations and business decisions. It’s good to get a fresh perspective and a reminder that there are no “right” ways of doing things.
- Feedback; Everyday from at least nine to five Jon Keon and I are on a continuous Skype call working towards the same goals. At this point, in terms of the business we’ve totally mind-melded. Having a total understanding of the business is great for us internally but being able to describe aspects of our business to our mentor has been a great low risk way to get our communication in order before we speak with outside clients and contractors. I remember the first time our mentor asked us to describe our offerings. We fumbled through a mix of abstract ideas and cliche industry jargon without providing a clear picture. Our mentor is there to listen, try to understand, and ask questions until we are able to communicate the idea. Clients will walk away when you can’t express yourself succinctly…our mentor hasn’t. At least not yet!
It’s All About Who You Know
As I alluded to in the Type of Work section, the people we knew, were invaluable to getting our first portfolio pieces out there. These were the pieces that helped us win more substantial work later. When we started, we figured that finding clients would be similar to looking for a job. Provide a company description, get on some vendor lists and start responding to RFPs. While we did get on a few lists no work really materialized and we ended up finding work through other means.
Jon and I have always taken the idea of never burning a bridge to heart and that seems to have paid off. You never know when you’ll run into that old boss from that summer job you hated or a former studymate from school. If there’s one thing we’ve learned it’s to stay connected. Finding work through personal recommendations is always easier than cold-calls.
Our first work came from one of our old professors at Carleton University where we both went to school. The project wasn’t huge but it got the ball rolling and proved to some of our other contacts that we were serious and capable of completing jobs in this new venture.
If you’ve checked out our past work you’ll notice that much of it was done for Mercury Active and Relish. Prior to founding Karman we had relationships with a few of the people at both companies. Our personal relationships allowed these established companies to trust that we could deliver quality work up to their high standards. Those first jobs were the start of some great relationships which, continue to be important partnerships to us today.
Originally published on a previous version of our site on October 24, 2014.
