Articles on Building a Business

Following a marathon effort, I’m delighted to announce that we’ve closed Webvanta’s Series A financing. It’s very exciting, and quite a relief, to have this behind us and to be able to really focus on growing the company in 2010.

Webvanta has been so different from my previous startup, Fotiva. We financed Fotiva (originally called PhotoTablet) in early 2000, in the final days of the bubble. We had nothing but a PowerPoint deck, yet we raised considerably more money than Webvanta has raised, and at a higher valuation. Times certainly have changed.

Fotiva existed for less than two years from conception to the sale to Adobe. In retrospect, it was amazingly quick, though it didn’t feel like it at the time.

Webvanta has already been in business for longer than Fotiva’s entire existence, and we just now closed the Series A. We’ve had our product on the market for several months, we have paying customers, and we’re well on our way to 2.0. And we’ve done all this on a fraction of the capital that Fotiva consumed.

By building the company more gradually, instead of being urged on by the VC-driven “get big fast” mentality, we’ve been able to explore market opportunities and evolve our product strategy more naturally. Keeping the company small has had its challenges, but it’s also been empowering.

We’re well set for great growth in 2010. I’m grateful to everyone who has played a part in making this possible: my family, which has endured a dramatic reduction in my income along with long work hours; my business partner, Christopher Haupt, who has done most of the real work of building our product; our board members, David Hehman and Greg Seal, who have been extraordinarily supportive; the angel investors who have provided the capital; and the designers and site owners who have been our pioneering customers. Thanks!

The First Two Years: Conception

It was 10 years ago last week that the idea for PhotoTablet came to me—an Internet tablet that takes care of your pictures. The day that name came to mind, I bought the domain and started writing a business plan.

Four months later, I had quit my job, had $2 million in venture funding, and was building a team.

Another four months later, we realized that the tablet idea was not going to work (as a business), and we transformed into Fotiva—a PC software company.

Within a year, we were in discussions with Adobe about selling the business to them. We had the product nearly ready to take to market in the fall of 2001, but with venture funding in a serious drought, we didn’t have a lot of options.

Two years after conception of the idea, we completed the sale of the company to Adobe. In retrospect, it seems an incredibly short period, though it didn’t feel that way at the time.

Last month, Adobe laid off the last of the original Fotiva engineering team, marking the end of an era.

My Stint at Adobe

A year after the acquisition, the software we built at Fotiva debuted as Photoshop Album. After two more years, it was rolled into Photoshop Elements as the Organizer, where it lives on today in version 8.

In my first year at Adobe, I was focused on getting Fotiva’s software turned into a shipping product. After a year in product management, I moved into engineering, managing a small research team and doing technology acquisitions.

For five years, I tried to find or create a role at Adobe that I enjoyed, and I can’t say I ever really succeeded. Although there were some great times and lots of good people, my entrepreneurial spirit and Adobe’s big-company culture did not mesh well. In the fall of 2006, I left Adobe to focus on the Web—something that I found almost impossible to do at Adobe.

Adobe and the Web

From the start, the PhotoTablet/Fotiva vision was for software and an Internet service working in conjunction to deliver the complete product. After the acquisition, however, Adobe senior management was totally disinterested in the online aspect. After pushing on this issue on and off for a few years, I eventually got support for building an online photo service. A dozen people worked on it for nine months—and then Adobe decided not to fund its rollout.

Another year later, I tried again, and once again saw projects started and then canceled before shipping anything. About the time I left three years ago, yet another online effort was underway; I left because I had no confidence in the way it was being approached. This project too ended without shipping anything.

Finally, in 2008, Adobe delivered Photoshop.com. Aside from the “third time’s a charm” aspect, I think the reason Adobe was finally able to launch a photo service was that the driving force was the creation of a Flex showcase. Unfortunately, it was too late to make much of an impact.

Adobe had plenty of engineering folks with a passion for building web services for photography, and a few products have made it to market. But the heavy-weight process and infrastructure, combined with top management that is often unsupportive of web initiatives, has kept Adobe from being a significant player in the online photo world.

Team Shifts

As part of this web initiative that began in 2006, the Organizer code base that had its roots in Fotiva’s code was transferred to a team in India for future development. What remained of the engineering team that I had built, and which Adobe acquired, was redirected to work on Photoshop.com.

In some ways, this was a great opportunity for the team, but it also meant a loss of continuity in the Organizer development. The people who conceived and built multiple versions of the product were no longer responsible for it. The results have been predictably uninspiring, though whether this is due to the transfer to India or to an overall reduction in resources is hard to tell.

I no longer use Photoshop Elements Organizer, after leading its creation and importing more than 70,000 pictures. I just doesn’t perform well enough, and Lightroom is closer to my interests. (I use iPhoto for video clips, since Lightroom frustratingly doesn’t support them, but that’s another story.)

The Annual Purge

More years than not (since 2000), Adobe has conducted an annual purge of employees toward the end of the year. The past two years, this purge has been especially deep, driven no doubt by the sagging worldwide economy.

I understand the need to realign resources when strategies change. But the frequency and vigor with which Adobe rearranges and lays off people leaves a lot of casualties. Having worked there for five or ten years, produced consistently good work, and supported the company through previous transitions is not enough to keep your job when management shuffles priorities again.

I don’t want to get into the debate about the merits of offshore development, but it is a fact that almost all of the Fotiva engineers were eventually laid off, and their work moved to India.

The Power of a Small Company

Aside from my five years at Adobe, I’ve mostly run small companies. After leaving Adobe three years ago and starting Webvanta a year later, I’ve been struck again by the incredible efficiency advantage small companies have.

Two or three people, juggling half-a-dozen roles, can get more done than a team of ten at a big company like Adobe. The absence of the innovation antibodies that are an epidemic at Adobe is a huge boost, not to mention the elimination of most meetings.

But the most important difference of all is having the people with the ideas and passion be the same people making strategic decisions.

I was not an early adopter of social media, being of twice the optimum age. But in the past few months, I’ve become much more involved with it, and I now believe it is going to be central to the growth of my business.

I’ve been on LinkedIn for many years, and found it moderately useful as a sort of distributed address book and business contact list. But its role in my life was very small, and entirely limited to business contacts.

Three years ago, I started getting invitations from friends on Facebook, which I accepted but rarely did anything with it.

About a year ago, the pace of invitations I was getting climbed, and I put some work into my profile. I connected with a bunch of high-school friends I haven’t seen in 35 years. It has been fun, but odd, to get little glimpses into the life of these folks—some of them were a big part of my growing up. The odd part is that, for the most part, these are people I never would have had any contact with if it were not for an online social network, and it’s unlikely I’ll ever see them in person.

A few months ago, I started paying more attention to Facebook, motivated more by business than personal desires. I went through my address book and invited people to connect; and I scanned the contacts of my contact to find other people I knew. In the past 20 years, I’ve worked with hundreds of people, and Facebook has proven to be an easy way to reconnect, however tenuously, to many people who I would like to stay connected with but realistically I wasn’t likely to, out in the “real world”.

With a few days of effort, I increased my Facebook friends from 25 to 250. (If only I had started 10 years ago, I would have thousands of “friends”.)

And then, of course, there’s Twitter. I’ve had an account for a couple of years, but only used it occasionally, usually at conferences. Recently I’ve gotten more involved, though I’m still not a prolific twitterer. (More on Twitter in an upcoming past.)

I’m of the wrong generation for all of this to come naturally, despite being something of an early adopter. I’m just starting to get real value, both personal and business, out of social networks, and I still have more questions than answers. Among them:

• Do I maintain separate networks of personal friends and business friends?
• Can I get myself to post frequent thoughts and updates?
• Do I use Twitter, Facebook status, and LinkedIn updates in concert, or do different things with each?
• How do I filter out the stuff I really care about?

Separating Business and Personal Networks

One thing I’m still coming to grips with is the blending of my personal and business contacts. LinkedIn is almost all business, but Facebook and Twitter are a mix (especially Facebook).

The easiest thing to do was to give up on separating my personal and business networks. That’s what I’ve done so far, though I doubt that it’s the best strategy.

The question is, do both groups of people have the same interests? For the most part, I think not. There’s also an interesting twist added by mixing the two groups up, but ultimately I think I’ll separate out my family and close friends network, in one way or another.

Dealing with the Flood

One I had hundreds of contacts, and the social network news feeds became prominent, the next challenge has been dealing with the flood of status updates, tweets, and so forth. To read all of it, even without responding to anything, seems like it would take hours every day.

My solution, so far, has been to simply dip in an out when the mood strikes me. I’m sure I’m missing all sorts of interesting stuff, but I haven’t wanted to devote the time to sorting through all the cruft to get to the nuggets. Some kind of filtering seems like the only real solution.

The Instinct to Communicate

It takes a lot of time and energy to make effective (or even ineffective!) use of all these social networks, and in the early days of using them the energy in is a lot higher than the value coming out. I have no doubt about the long-term value, but it’s still hard to spend the time it takes to keep up with even one of my online social networks.

I’ve been blogging for three years and have never sustained anything like the frequency of posting that I aspire to. I have all sorts of articles running around in my head—the legacy, perhaps of a dozen years writing newsletters and magazine columns. But they take time to commit to bits. What you’re reading now is one that’s been rolling around inside for a couple of months and finally made it out, sitting in a cafe in Santa Rosa while I wait to pick up my daughter from ice skating.

I’d like to get up to at least one blog post a week. And to several tweets a day. It takes a big shift in mindset, though, to communicate this frequently and proactively—it’s an opportunity that didn’t exit prior to online social networks. We’ll see if I get there.

My Success Story

The biggest chunk of business value that I’ve ever gotten from these networks occurred a few weeks ago, when I was looking for a couple dozen web designers who I could interview and get feedback on our new product. I’d exhausted my direct network, and the step to cold calling is a big one.

So I used a LinkedIn question, in addition to a Facebook status update and a Tweet, and with a few days I had introductions to a few dozen people. Because these were introductions, and not cold calls, even though I had no prior direct contact with these people more than half of them have spent an hour with me in a web-based demo and phone discussion.

These networks were a fantastic resource for me. They allowed me to make a casual request of hundreds of people to whom I would have hesitated to email, and I got responses from a good scattering of them—and often not from the people I would have predicted, if I had to select a smaller number to contact.

Coming up in my next post: Twitter stories.

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My favorite presentation from Web 2 Expo:

Read Tara’s blog at www.horsepigcow.com for more.

Her book The Whuffie Factor is due out April 21.

And if you’re curious about the origin of Whuffie, it comes from Cory Doctorow’s Down and Out in the Magic Kingdom.

It’s been an embarrassingly long time since I’ve posted here. I have lots of things running around in my head that I want to blog about, but it’s been hard to find the time for it. But I like to write, and I appreciate any readers I may have out there, so I’m resolved to get back to it.

What has made it most challenging is that I’m up to my eyeballs in running Webvanta, the startup I cofounded with Christopher Haupt. Startups are always all-consuming, and the current economic climate has made it even more so because of the difficulty of raising capital.

We have managed to raise a modest amount of capital, but it’s been very time consuming, and it’s not enough for us to get out of bootstrapping mode. So my time is split between ongoing fundraising, growing the business, and doing contract work as part of our bootstrapping process. It’s fun, but exhausting.

More soon.

Today we reached an important milestone in the short history of Webvanta—we closed the next phase of our financing. We now have the capital we need to take our platform to the next level.

I’m sure it comes as no surprise to anyone who has picked up a newspaper in the last three months that it’s been an incredibly challenging time to raise capital. We began our active fundraising with a presentation at the North Bay Angels on September 18, a day when a Wall Street Journal headline read, Worst financial crisis since ‘30s, with no end in sight. And things got worse, much worse, from there.

The freezing of credit markets, followed by the stock market collapse and the widespread economic malaise, made investors of all stripes extremely risk-averse. This week’s treasure-bill interest rate of 0% is the latest indication of the conservatism that pervades today’s investment climate. Many people are focused not on getting a return on their investments, but on simply preserving their capital.

Despite all this, we kept moving forward, refocusing on a smaller convertible debt financing instead of a Series A offering. We worked closely with several members of the North Bay Angels to craft terms that addressed their concerns about investing in these challenging times.

Today we closed the financing. I’m honored by the trust that our investors have placed in us. It is so easy these days to simply say “no” to any investment proposition. I am grateful to the intrepid souls who chose to support our efforts and say “yes.”

I’m thrilled to be able to put a renewed focus on moving the business forward; raising capital is always a big distraction, and in this climate, it was a huge distraction. Although we hope to raise additional capital in the future, we’ve structured the business in a way that it is not dependent on future capital infusions to survive.

The opportunity in front of us is tremendous: no matter what happens to the economy, the web will continue to be a crucial tool for businesses and organizations of all kinds, and we offer them a lower-cost way to gain more benefit from it. We believe that the way most web sites are built is overdue for a massive shift to software as a service, and we have a powerful platform to enable this shift.

If you haven’t yet seen the Webvanta service, watch our three-minute intro video and sign up for a free trial account. We’ll be adding lots of new features in the coming months, so if there’s things you’re particularly interested in seeing included, please let me know.

(For more thoughts on raising angel financing, see the article I wrote for Spartina.com, one of the first sites built on the Webvanta platform.)

After an amazing year of effort, I’m thrilled to report that the Webvanta beta is now live! Sign up for a free trial on the site and let me know what you think.

Webvanta is a hosted platform that enables anyone to build content-rich, database-backed web sites with all the cool Web 2.0 features, without programming. We think of it as content management system + KnowledgeBase + community.

If you want to build a site that communicates your knowledge about a particular topic and fosters a community of interest, we believe Webvanta is the best solution available.

We’ve found our initial traction with information portal sites, but you can build nearly any type of site using the platform. In the coming months, we’ll be expanding the features to enable more drag-and-drop design, as well as even richer KnowledgeBase features, e-commerce capabilities, and more.

Looking for Custom Projects

Webvanta is self-service, and you can do everything yourself, within the limits of the platform. But we’re also looking for custom site creation work that builds upon the platform.

We’ve found that with our experience in building sites, we can greatly accelerate a company’s time-to-market by helping them think through the structure of their KnowledgeBase. And because we are intimately familiar with the platform and have lots of experience building sites with it, we can implement custom designs very quickly. We can also develop custom extensions to provide features that aren’t available to self-service customers.

If you have a project for which our custom services may be a fit, send me an email or call me at 888.670.6793 ext. 2.

The financial meltdown of the past two weeks has been scary to watch. The New York Times has a nicely done interactive graphic of the stock market decline that puts it in the perspective of previous market collapses.

This came just as my startup company, Webvanta, has been pitching angel investor groups and putting together a Series A financing. The financial crisis has obviously made this process more difficult. It will take us longer to close the financing, and we’ll probably do it in a couple of stages. But we will make it through. We don’t have a high overhead to support, and we’re deeply committed to doing whatever it takes to succeed.

In terms of the market for our service (vs. the market for investment dollars), tough financial times don’t trouble us much; in such times, our service will be even more attractive to our customers because it slashes the up-front costs of having an effective web site.

Clearly the situation is bad. The fear is building on itself and making things even worse. The folks who are tasked with trying to stop the downward spiral have an unenviable job. As an entrepreneur, my job is relatively simple: keep pushing forward, and ensure that, above all, the company survives, so we can prosper in the good times that will eventually follow.

As our investor, board member, and staunch supporter David Hehman is fond of saying, Perseverance Through Adversity Leads to Success.

Warnings Galore from Investors

You can read all the gloom and doom predictions you can take by picking up your daily newspaper. Of more interest to entrepreneurs than the mainstream press are the writings of various folks in the startup community. The first was a lengthy piece by Jason Calacanis, The Startup Depression, which first went to his “private” email list but was later posted to his site. It seemed pretty severe at the time, but a few days later it started to seem almost reasonable.

In the past two weeks, there’s been a series of warnings coming from leading investors, giving advice to their companies. These were meant to be private communications, but with plenty of well connected bloggers eager to publish, anything that goes out to a sizable list doesn’t stay private for long.

Ron Conway’s email to the companies in which he has invested, titled IMPORTANT PLEASE READ ASAP …..REGARDING CURRENT MARKET CONDITIONS…, was the first such memo to be leaked. The core of Conway’s message is this:

“The message is simple. Raising capital will be much more difficult now.

You should lower your “burn rate” to raise at least 3-6 months or more of funding via cost reductions, even if it means staff reductions and reduced marketing and G&A expenses. This is the equivalent to “raising an internal round” through cost reductions to buy you more time until you need to raise money again; hopefully when fund raising is more feasible. Letting go of staff is hard and often gut wrenching. A re-evaluation of timelines and re-focus on milestones with the eye of doing more with less will allow you to live many more days, and the name of the game in this environment in some respects is survival–survival until conditions change.”

Even more dire in tone was Sequoia Capital’s Doomsday Meeting. This was an in-person, emergency meeting that the CEOs of all of Sequoia’s portfolio companies were required to attend. It was supposed to be private, but notes from the meeting, as well as the slides themselves, soon made it on to the web.

Prudent, or Self-Serving?

These missives have provoked a variety of reactions. From my perspective, you can’t blame investors for wanting to do what they can to help their portfolio companies survive, and it is clear that there’s hard times ahead. Valuations are going to fall, with some of the drop attributable to the genuine change in exit opportunities and prices, and some of it due to investors taking advantage of the crisis to get better deals. That’s just how the system works.

Venture investor Fred Wilson’s Don’t Shoot the Messenger responds to some of the criticism, and the comments to his post are well worth reading for an assortment of opinions.

The best way to manage a company is indeed different in boom times than in downturns, and investors are appropriately concerned that entrepreneurs won’t adjust quickly enough. After all, being an optimist is a necessary characteristic for creating a new business. We’ve come to a point, however, where we need to be a little pessimistic about the near term to ensure our survival, so we can continue to be optimistic for the long term.

One of the fun things about startups is how quickly things can evolve. Startups can make strategic decisions in 24 hours that a company like Adobe would debate for a year. They might not always be right, but they sure can try a lot more things and adapt more quickly to changing markets and new insights.

At Webvanta, we’ve recently made a major shift in our customer focus and go-to-market strategy. We had been focusing on small businesses as our customers. We’re keeping that strategy in our back pocket for later use as the business evolves, but we’ve decided to focus on web designers as our customers.

Our product is still much the same: it’s a hosted platform for quickly building and deploying powerful web sites. What’s different is that we’re now focused on providing this platform to web designers, to enable them to deliver better solutions to their clients.

This has a huge benefit for us: the web designers get to find, and interact with, the small businesses. That’s something that we came to realize was going to be hard for us to do at scale. It gives us a lot more leverage, since the folks we’ll be setting up to use the platform will be building sites on an ongoing basis, not just once.

The new strategy also enables us to target a wider range of sites, still including small business sites but no longer limited to that. Our platform is also great for information portals, membership sites, and more.

We’ve been meeting with a wide range of designers to get feedback on our offering, and the feedback has been great. We think there’s a real opportunity here to tune the platform to their needs. The way designers have been building sites involves a lot of unnecessary pain that we can take away.

If you’re a web designer and are interested in being a beta tester, send me a note at michael at webvanta dot com.

More news soon…

We’ve been making great progress at my startup, Webvanta. We recently renamed the company from Collective Knowledge Works, in part because that name was just too long, and in part because it no longer matched our target market. We started out with a broad horizontal focus on knowledge sites, and we’ve evolved to a vertical-market focus on small businesses.

We’re now hosted on a top-quality infrastructure at Engine Yard, and we’ve moved to a largely new codebase with a multi-tenant architecture. BuildingWebApps is now just one tenant, running on exactly the same application that will, in time, host thousands of sites. We’ll be launching the first additional sites within a few weeks, and by the end of September we expect to be in a private beta phase in which invitees can create their own sites.

We’re also ramping up our financing efforts, with the goal of raising a mid-size angel round this fall. Exciting times!

It’s been a while since I’ve posted to this blog, so I thought it was time for an update.

Anyone who has been involved in a startup knows how all-consuming that can be. We also have a blog over at BuildingWebApps.com, and I’ve been writing a bit both for that blog and for the core of the site. But most of what has been consuming my time is crafting a business around the technology we’ve been developing.

Christopher Haupt and I founded Collective Knowledge Works, Inc. last fall, and our first venture was to launch BuildingWebApps, a resource site for Ruby on Rails developers. We also started the Learning Rails free online course, which began with podcasts and has evolved into a series of screencasts, in which we build a Rails application step by step. It’s been tremendously popular, with several thousand people following the course. It’s a lot of fun teaching this way, and seeing how much value people get from it.

We considered building a business around serving the web application developer community, but we’ve decided to keep this as a side project, rather than the core of our business, because we want to build something that we believe we can scale into a more significant company.

In thinking about the application we built to create the BuildingWebApps site, we realized that it has a much broader potential use: building a resource site on any topic. We think of it as the next generation beyond blogs and content management systems. We’ll offer this as a hosted service, enabling anyone to build a site like BuildingWebApps, on any topic.

The next question was which customers to focus on. We found that, as a horizontal technology platform, it was hard to explain to people, and hard to come up with a focused marketing strategy. Some customer groups we looked at include:

• Infopreneurs: people building web-based information businesses
• Passionates: individuals or organizations who are passionate about a topic and want a platform for communicating their knowledge and engaging the community
• Businesses: businesses for which educating their customers and prospects is important

After lots of analysis, we’ve decided to focus our initial product on the last of these categories: in particular, on small businesses. There’s a lot of customer pain here that we can address, and a lot of value that we can provide. Most small business sites are awful, if the business has a site at all. The model of going to a local web developer and building a site from scratch is expensive and painful, and almost always results in a largely static site with no community features.

We’re going to provide a platform to make it easy for small businesses to create powerful sites that engage their customer community and become valued information resources that attract new customers. There’s lots of pieces of this that go beyond what we’ve done at BuildingWebApps, and which we’re not quite ready to talk about.

We may also have versions of the platform for the other two customer categories, and they may be the source of significant long-term growth, but they won’t be our initial focus.

We’ve raised a little more angel financing to take this to the next level, and we’ll be launching the product in the fall. There’s a teaser at the embryonic Collective Knowledge Works site. If you’d like to be notified when we have the private beta ready, please enter your email address there.

It’s been a fascinating process getting to this point. It’s been a year and a half since I left Adobe and gave myself the flexibility to pursue various interests and see what bubbles up. A lot of threads have come together now, and I’m really excited about where we’re heading.

After several months of development, we have finally taken the wraps off the BuildingWebApps site!

Note: I won’t be publishing any more Ruby on Rails or web development articles on this blog. This will be more of a personal blog, with everything related to web technology going on the new site. To continue receiving the Rails articles that I and my colleagues will be writing (and we have plans for lots more articles than I’ve been able to publish here), please subscribe to the BuildingWebApps articles feed.

You can also subscribe to the BuildingWebApps blog, where I’ll be writing about the process of building the site and the business.

State of the site

BuildingWebApps.com is still very much a work in progress, but we’ve gone ahead and opened it up so we can get feedback. Please take a look and let me know what you think.

We worked with Josh Woodlander and Ethan Allen at Raspberry Media on the visual and interaction design, and I think they did a fantastic job. It was a joy to work with people who have such a strong sense of graphic design and who think deeply about the challenges of effectively presenting lots of information. And Ethan is a wizard at making all the browsers behave reasonably. (Any oddities you see are probably the result of my modifications.) If you’re looking for a team to take on a significant web design project, I highly recommend them.

My goal is to build this site into a valuable resource for the Ruby on Rails community, and for people who want to learn Ruby on Rails. Over time, we’ll increase our coverage of other web-related technology as well.

The site includes both original articles and an annotated, organized set of links to hundreds of other resources around the web. We’re in the early phases of building up the content, so I realize that it will seem a little thin in places (and if you’ve read the Rails-related articles on this blog, some of it will seem very familiar). But there’s lots of great stuff to come.

I’m really interested in feedback on the usability of the site. You can also submit suggestions on the site to help us build up the content.

How is this a business?

In case you’re curious about the business model: we plan to make all the core content free indefinitely. At some point, we’ll add some premium content that will require membership or a one-time payment. We’ll probably have advertising. And we’re offering seminars.

Longer term, we believe that the application we’re building to power this site will be applicable to many other knowledge domains and communities. Blogs and wikis are all the rage, but they both have huge limitations that we believe our platform will overcome.

Don’t forget to change channels

Once again, please note that I won’t be publishing any more Ruby on Rails or web development articles on this blog. I will continue this blog to write about a variety of topics beyond web development, so please keep your subscription here if you’re interested in my random thoughts. But if you subscribed to this blog primarily for web development information, it’s time to move on:

• To continue receiving the web development articles that I and my colleagues will be writing, subscribe to the BuildingWebApps articles feed.

• To read about the evolving business of which BuildingWebApps is a part, subscribe to the BuildingWebApps blog.

Thanks!

One year ago today I embarked on my current adventure, leaving Adobe after five years there and two years creating the startup they acquired, Fotiva. At the time I left Adobe, I had only the fuzziest idea of what I was going to do, but I knew it would be related to the web, and I was pretty sure it would be connected to Ruby on Rails. And that it has turned out to be.

I’m as busy as I’ve ever been, and my income in the past year is the lowest it has been in more than 25 years. But I’m having a great time, and I have a good feeling about where things are headed. I thought I’d take the excuse of this one-year anniversary to look back on my decision to leave Adobe, and catch my readers up on my business thinking.

Looking back on Adobe

I’ve not written much about my experiences at Adobe, in part because I want to avoid any possible appearance of breaking confidentiality agreements, and also because I wanted to gain some perspective first.

Looking back on my five years at Adobe, there’s a lot that I’m grateful for. I learned a tremendous amount about digital imaging and the PC software business, and about life inside a big company. I met a lot of great people, was able to immerse myself in digital photography, and had the opportunity to lead a research team and do technology licensing with the power of a big player behind me. The team I helped build for Fotiva continues on, in large part, as Adobe’s Santa Rosa office, and I’m pleased to have had some small role in growing the software business in the North Bay. And the product that started life at Fotiva has an enduring role as the organizer in Photoshop Elements.

In a strange way, though, I’m most grateful to Adobe for being so thoroughly dysfunctional when it comes to enabling innovation that it drove me out. As someone with a entrepreneurial heart, I found Adobe stifling. If I had been able to accomplish a bit more at Adobe, I might still be there, and then I would have missed out on so much.

To a large degree, the challenges I faced finding happiness at Adobe would be there in any businesses at that scale. But not entirely. Many of the other entrepreneurial folks I met at Adobe, who tried valiantly to build new products and services, have also left. They’re at an assortment of small companies, but also at Google, and Yahoo, and Apple.

One of Adobe’s biggest weaknesses, in my view, is the distance between top management and the people who have passion for innovative new product ideas. It is exhausting, and usually dispiriting in the end, pushing ideas up through a chain that, at it’s pinnacle, doesn’t seem very interested.

The difficulties I had getting new concepts to market at Adobe, especially when they were web-related, are symptomatic of top management’s resistance to exploring new concepts in the marketplace. Adobe doesn’t like to accept the risk of new markets in return for a role (and learning opportunity) as an early player. Perhaps at Adobe’s scale their approach of waiting until market opportunities are clear, and then buying their way in as needed, makes sense. But it did not make for a satisfying place for me to work.

My evolving Ruby on Rails business plan

When I left Adobe, I had done a little Rails development, and read a lot about it, and I felt strongly that it was going to be a big deal. I spent the majority of this year building custom Rails sites for small businesses, and set up Topaz Web Solutions LLC as the home for that work. I enjoyed it, and some of it is ongoing, but my focus has now shifted to Collective Knowledge Works, Inc., the company I cofounded this fall with my partner Christopher Haupt.

I spent quite a while looking for ways to build a business around delivering Rails-based solutions to other small businesses. I continue to believe there is a great opportunity in this domain, but the sales and support challenges are significant.

Collective Knowledge Works grew out of an idea I had to create a portal for Ruby on Rails developers. We’re now deep into doing just that: you can sign up for the beta list at BuildingWebApps.com. Within a couple weeks, we’ll be letting in beta testers, and early next year it will be public. I can’t wait to show it off, and I think it’s going to be a great resource for the Rails community. After eight years away from the editorial, publishing, and training business, I’m glad to be back in it.

Initially, we don’t expect BuildingWebApps.com to generate much revenue directly. Our first revenue stream will be from the Ruby on Rails QuickStart Seminar that we’ll be presenting in February in San Francisco. Later, we believe we can create revenue from the site itself in various ways.

Christopher and I have just launched the Learning Rails podcast, which has been an adventure of its own.

There’s a bigger plan in the background, too. All the technology we’re building for BuildingWebApps.com can be used for any knowledge domain. After we’ve had time to build out this first site, we’re going to develop additional knowledge domains, and enable others to host their own knowledge domains. That’s why we named the company Collective Knowledge Works.

It’s great to be back in this early business-building phase. And it’s wonderful not to have to try to sell new ideas up through multiple layers of management, but simply to decide what to do, and then do it.

For the past several months, the majority of my time has gone into a web application for a startup called Accreditation Helper. The marketing site went live today, and next week the product will be shown publicly for the first time at the Medtrade show in Orlando.

This web app forms the heart of the business for Accreditation Helper, which assists Home Medical Equipment companies …

See the full article on my Topaz Web Solutions LCC blog.

It’s been awfully quiet here on the blog the past month or so… but that’s only because life here in the physical world has been busy, busy, busy.

I’ve been spending most of my time on a large Rails application for a start-up client. In another few weeks, I’ll be able to tell you about it.

I’ve also been formalizing my web development business as Topaz Web Solutions LCC. I’ve been operating as a sole proprietor until now, and it was time to pick a name and create a better legal structure. (The Topaz name, incidentally, has no particular significance; I was just looking for something short, memorable, and not already used, and came upon this after starting with Ruby.) I’m booked up through October, but would be glad to hear about any projects that could start after that.

I’ve also been hard at work on a resource site for web application developers, and I’ll be telling you about that soon.