Interview with Jason Fried of 37Signals

September 6, 2005 in An interview

Jason Fried heads 37Signals, a web services firm turned product firm (mostly). They offer the insanely successful Basecamp, followed recently by the sharply concieved and executed Ta-Da lists and Backpack services. 37Signals is now working on 3 new products (details below) and a new self-published book.

Jason himself has gained a fair amount of visibility due to the success of his company. His last interview was with super guru Tom Peters. Today he sits down with me to offer some insights about what makes him and 37Signals work.

Before we get started, can you settle some bets and tell us how to pronounce your last name?

Ha! FrEEd. Spelled like "fried chicken" pronounced like "freed" as in we've freed people from bloated software.

1. Now you, and 37Signals, over the past couple years have become a new standard of sorts for Internet-centric entrepreneurs. Particularly for those that aspire to move from a service model to a product model. How did you make the leap successfully? There have been thousands who have tried, but you guys pulled it off. You've got a profitable company. That's no small feat. What do you think it is about what/how you guys are doing it that made it fly where so many others haven't?

Well, like most good things, this happened by accident. When we set out, we didn't plan on shifting from a service model to a product model. In fact, we originally built Basecamp to help us manage our client projects. We wanted to make our service model business easier to manage. It wasn't until a few months in that we realized this could be something other than just a tool we could use for our own projects. Then we decided to make it an actual product. We generally don't deal with projections or estimates (why waste time guessing?), but we did take a stab at the projected monthly revenues after 12 months. Turned out that we beat that estimate after the first 6 weeks. It was at that point that we had a feeling we were on to something.

I think our focus on simple tools really helped us succeed. There's too much bloatware out there. It's everywhere you look. I mean, we all use Microsoft Word, but have you ever heard someone say a single good thing about it? Software shouldn't be something you feel like you are forced to use, it should be something you want to use. You should be passionate about the tools you use to get your job done.  Our anti-bloat stance can be summed up in our "Less Software" approach.

In the end, we wanted to build a product that we were passionate about. If we weren't passionate about it, we wouldn't use it and if we wouldn't use it then we wouldn't care about it. And if we don't care about it how can we expect our customers to care about it?

So, I think the only way to build a great product is to build something for yourself. If you're happy with it chances are there are thousands of other folks who think like you and want exactly what you want. So, deciding up front not to try to please everyone is the best way to build a great product.

Of course you need to build something good -- building a crappy product for yourself won't work for anyone.

2. To date you've got 3 awesome products, and a book. All seemed to be marketed to, and aimed at a fairly targeted and limited niche audience (your professional peers essentially). But now you're starting to make inroads into all sorts of industries, especially with Basecamp. Reading about you in Business 2.0 where they profiled the maker of KidRobot and he sang your praises I thought "man, these guys are going to conquer the world." What do you feel has been the key in helping you move into the broader market?

The key is less software, or I should say more general software. 

Sure, we've targeted niches, but only through marketing -- there is nothing in any of our products specifically targeted at our peers. There's no exclusive web-designer features in Basecamp. Basecamp is just messages, to-dos, and milestones (and now time tracking for those who want it). Anyone with a client or anyone with a project can find value in messages, to-dos, and milestones. So, by keeping our products simple and general we're able to reach a much larger market.

So my advice to people trying to build products is this: Give people just enough to solve their own problems their own way and then get out of their way. Basecamp and Backpack are all about simple useful little "tool nuggets" -- messages, to-dos, reminders, milestones, notes -- that give people the basic tools to do what they want their own way.

3. You're obviously a brilliant marketer. You're very generous in sharing your ideas, you have a popular blog, and you've got great products, including a sort of "shareware" now with Ta-Da lists and the free versions and trials of Backpack and Basecamp. What have been your most successful marketing efforts?

I don't think we're brilliant, we're just getting back to basics. The best marketing in the world is to give people products they love.  Give them things they want to tell others about. Make your customers your salespeople. And be honest with them -- if there's a problem, let them know about it. If someone asks you a question, give them a straight answer. People can see right through the bullshit. Be direct, honest, and clear and you'll build trust which builds great customers.

Now, of course the toughest part is getting the initial word out. You can't have word of mouth until you've captured a few ears. So we think the best way to do that is to give away your knowledge and experience so others can benefit. Use education to educate and promote. For example, when we developed the Yellow Fade Technique we wrote a post about it on Signal vs. Noise. That post made the rounds -- thousands and thousands of page views (even today it's doing huge traffic). That was an educational post as well as a promotional post.

So share. Share your ideas, share your designs, share your insight, share your experiences, and above all, share your mistakes -- it shows you're human. People like people.

4. What marketing efforts have been stinkers?

I don't know, really. We don't track these things. I sorta see marketing as a side effect of loving what you do. If you love what you do, provide value for your customers, share your experiences and ideas, marketing just happens. Honesty is great marketing too because honesty is free.

We have spend some money on Google ads which have done all right. Is it worth it? I'm not entirely sure. We don't spend a lot on them so the cost of analyzing their success would cost more than just tossing a few bucks in a month to see what happens.

We haven't done any print advertising, but we will be running our first print ad shortly so we'll keep an eye on that.

5. All of your applications cover a similar area. You've previously argued for the opportunity facing companies who can cater to the "Fortune 5,000,000." Are there other specific areas you see opportunities? Anything in particular that you've got your sights on?

We are eyeing a few categories and working on three new products right now. One deals with writing, one deals with conversations, and one aims to redefine the stale "CRM" market, although we'd never call what we're building a CRM tool.  We're aiming to have all three out by January of 2006, but who knows if we'll hit that mark. They'll be released when they're ready.

6. As a successful entrepreneur and businessman, you've got many important demands on your time, yet you still manage to get stuff done. What's your secret to time management? What methods/tools do you employ to manage your time well?

I'm really not that great at time management. I forget to do a lot of things (especially writing thank you notes which is a horrible thing to forget to do). Backpack reminders have definitely helped, but I'm still not great at remembering the little things. It's something I need to get better at (and that's not a software thing, it' a personal thing). Software doesn't solve problems unless you make the software solve problems. Software is dead unless you breathe life into it.

The other thing is to make things easy on you. It's a lot like our Less Software approach -- the less features and the less code, the less can go wrong and the less you have to manage. It's the same with time. Make things easier on you -- make quick, simple decisions and then go back and change that decision if it doesn't work. If you make a mistake it's no big deal if you can correct that mistake quickly.  Don't burden yourself with stuff that really doesn't matter. It's a bit of an art to figure out what really doesn't matter, but it's more than you probably think. Most things we all spend our time on don't really matter.

We have no red tape at 37signals and I try to keep red tape out of every aspect of my life. Red tape makes people afraid to make decisions because they know they'll have to go through the red tape process again if they need to make a new decision. Keeping that cruft out of your life make it easier to manage your time.

7. Are there any books/magazines/etc that you enjoy that you would recommend?

Hmm... Best book I've ever read on interface design is Designing Visual Interfaces by Mullet and Sano. HIGHLY recommended. I also recommend Against the Odds: An Autobiography by James Dyson the Dyson vacuum guy. 

For inspiration I like to thumb through magazines that have nothing to do with my industry. I look in car mags a lot, home renovation and furniture mags, and science magazines. I'm completely inspired by simple creative solutions wherever I see them and the best place to look for these is nature. Go get out your camera, flip on the macro setting, and take pictures of flowers, leaves, tree bark, stones, etc. You'll see genius.

8. Besides WorkHappy.net *cough* and SvN what blogs should every entrepreneur be reading?

Why thank you! The only entrepreneurial blog I read frequently is: Creating Passionate Users Everyone should read this every day. She's so right on the money.

9. Any parting advice for other entrepreneurs trying to get a foothold and become the (next) "37Signals" of their industry?

#1: Don't try to be 37signals, try to be yourself. We didn't try to be anyone else. Nike didn't try to be anyone else. Apple didn't try to be anyone else. You have to have your own vision -- that's the only thing that will ever keep you happy, passionate, and delivering the best you can possibly deliver.

So, find something you are passionate about and go for it. There's never been a better, cheaper, easier time to get started. There really is no excuse not to give it a shot today. Fixed costs are near zero. The only thing you need is an idea, passion, time, and skill. 
We hope you succeed (and use Basecamp and Backpack, of course ;)

Thanks Jason, I really appreciate your time.
Thank you, sir. I really enjoyed it.

Jason has agreed to respond to a few reader questions in the comments of this post if you'd like to ask him something I missed.

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Good interview, i enjoyed it :)

Having put my dipped my toe into the water with Basecode for Basecamp i am being a little more ambitious with my next piece of software (still with integration with Basecamp so hurry with that API and make my life easier). My question is regarding your naming of products.
Did you think long before deciding on a name?
Did the fact that basecamp.com was gone worry you that people would go to that then give up the search?
Did you look into trademarks etc. before finally releasing Basecamp?
How much importance did you give to the name for putting the word out?