Starting a Software Business is Getting Easier

It used to be that starting a software company was hard. It was hard because you had to do everything yourself, and doing a lot of those things was expensive. Over the past 25 years, since the birth of what we would call the first modern software companies – Google, Yahoo, Viaweb – the trend has been that starting a software company involves doing fewer things yourself, and the things that you end up having to do cost less money.

We are at a point in 2021 where you can start a software company and launch a product entirely from your couch in around two days for around $500. And that $500 is literally just for incorporating the company as a legal entity. The product you can build and host for free. And you don’t even need to pay that $500 if you want to run your business as a sole proprietorship, which is just a fancy term for a one-person business that doesn’t have a legal entity.

We are also at a point in 2021 where software companies are making money hand over fist at crazy high margins. People who own equity in successful software companies are getting massively rich every day. But unless you live in a small number of locations and run in certain circles, you probably don’t know very many people who have started their own software company. Why is that? It’s a low-risk strategy for becoming very rich, so what gives?

One reason is of course lots of people just don’t want to. Starting and running a business requires a lot of initiative and time commitment, and comes with a lot of responsibility. You have to deal with customers when people start using your product. You have to make sure your software stays online. All that. Some people just don’t want that headache, even if it might result in them getting rich. They like the stability, predictability, and narrow responsibilities of whatever job they currently have. That’s cool.

But my guess is there are millions of people that don’t start software businesses simply because they don’t know how. And even if they have heard some things about what to do from talks and blogs, they don’t have the kind of playbook that would put them over the edge to believing they could really do it.

I think a playbook like that is possible to create, and I think the fact it doesn’t exist yet is just because we are so early in the internet age. We are still figuring out what it means to be always online and to integrate software into more of life. The knowledge about how to reliably build a profitable software business exists, it’s just not evenly distributed yet.

There is a combination of skills that will become more common to see in a single person. Coding, design, copy writing, marketing, selling, finance. The fundamental skills of running a solo software company on the web. As tools for building apps get more powerful, you’ll need less specialization in programming and design, so it will be possible to also be good enough at the business-side skills. This is already happening but is not evenly distributed. It’s happening with people who care enough about building their own software company to work on it on nights and weekends, teaching themselves the skills outside their current expertise. But the people who are on the frontier now, figuring it out for themselves, will write down what they figure out and soon “indie software founder” will be a viable career option people consider starting in high school.

There will be online curriculums that teach you everything from JavaScript to Figma to good copy editing. There will be playbooks for finding toy business ideas and executing on them and making real money, just to get a taste of what it’s like and to show you that it’s possible.

And the thing about software is that it is capital. It can make money for you while you’re sleeping, or more exciting, while you’re hanging out with friends and family. The cool thing about software companies becoming easier to start is not that everyone will be rich and famous like Mark Zuckerberg. Most people would hate to be Mark Zuckerberg. The cool thing about software companies becoming easier to start is that more people can spend less time working, because their company is making money in the background.

Matt Roll @mroll