Tips and tricks for running a development shop

Question

Guys, so I've started my own bodyshop/development company/freelancer-to-enterprise middlemanshipry, jumping from a freelance web development myself.

Currently, I'm working on it extremely fast, going from an idea to a staff of developers and a first outside salesperson in four days—yet, I'm already feeling I'm doing some nasty mistakes right from the start.

Those of you who have had a similar experience—what is the worst mistake you wish you've never made on your way and what's the best bit knowledge you wish you knew when starting?

Answer 1

Here are my two cents.

This experience comes not from a dev shop, which at some point I would like to start, but from a little grocery store I run when started college some (long) time ago already.

Two most important things I remember from that time by making mistakes on them, and luckily correcting them quickly enough, were:

1) it's all about the customers

2) control your costs, and make them as variable as you can

1) means, sometimes, you'll have to sacrifice things for the customer, like not playing with your favorite tool but those which are right for their job. In my grocery store, it was about doing daily re-provisioning instead of 2 or 3 times a week, to make sure customers found what they needed.

Also, make sure there's a Sales/MRK guy in there to transmit engine's energy to the surface! No matter how good your idea is, you need someone making it known, knowing your audience, develop a great segment and positioning strategy, etc.

2) is simple - make sure you can increase/decrease operation with minimal hassle financially speaking. That may mean e.g. get people to share gains & looses at least until the shop has enough financial buffer. (How possible is that today BTW? Is that an usual practice?)

And for a dev shop, I would add one - have a great partner. I don't know of statistics for this, but I'd bet that, most shops that succeed came from partners with great understanding, mutual support and, most important, trust. You need to be able to rebound ideas, trusting the judgment of the other person and trust on their execution.

BTW, this book is pretty decent on the subject, Eric Sink on the Business Of Software

Answer 2

Hire a fully qualified, professional, genuine Accountant.

Hire a fully qualified, professional, genuine Lawyer.

Have them handle ALL of the regulatory, financial, and legal paperwork, filings, recordings, calculations and such.

You are the technical leader, the guy with the software/hardware knowledge. DO NOT try to do everything. Rely on teamwork and delegation, do what you are good at, and surround yourself with people who are good at the things that you are not good at.

Answer 3

My boss once said, "People think that it's important to keep the books and so on, but what matters most is sales: without sales, there are no books to keep."

Answer 4

Cashflow, cashflow, cashflow. Manage it carefully.

Answer 5

20% of customers bring 80% of trouble

Sometimes it is better to deny a possible contract, than to get stuck fighting the windmills.

Answer 6

Just remember the most important rule,like a wise businessman once said:
“Look after the customer and the business will take care of itself”