What advice can you give developers who would like to start selling components?

I got "found" via twitter late last year by Adam Tel, an author for Smashing Magazine. He was writing an article and wanted to talk to component developers and was writing an article about such things. I answered a few questions for him over e-mail and this is a transcript of my answers. I'm not sure if I'll make it into an article. At the time I'm writing this post, I cannot find such an article on the site. This is a transcript of our conversation.

Hi guys, Thanks for agreeing to participate in this article, which would be published on SmashingMagazine.com. I have a few questions, feel free to skip the ones you don't feel like answering. Please note that these answers would be quoted in the article, and probably published, so if there's info you don't want to share, feel free to omit it. So here we go:

1. Can you please describe shortly what kind of components you develop, and who uses them? Assume some of the people reading do not know anything about Flex.

At Flextras, I build User Interface Flex Components. Flex is part of Adobe Flash Platform and is used for creating Rich Internet Applications, on the web, on your desktop, and on your devices. I provide developer's with user interface widgets, such as a Calendar, that they can use as a starting point to more complex application. Our goal is to provide developers with a Flexible, extensible code base that they can easily adapt to their needs.

[Future Jeffry Note: I probably should have said that our main selling point is that we save developer's time when compared to writing similar components on their own].

2. Are you currently making a living from selling these components? Or is it just a side gig?

The long term intent is to grow Flextras into a five person company, generating about $600K in sales. We are not there yet. Flextras is about to enter it's third year in business. During our first year, the company had a financial loss. This year, we will turn a profit, however not enough for me to take a salary.

I make up the "balance" of my income by doing some private training, and small custom development projects, primarily for small businesses.

3. What are your goals for the next year?

Our biggest goal is to stay in business for another year. We haven't figured out how to make the business work yet. We expect to add at least one, if not two, more products to our component set. We also plan to introduce some behind the scenes changes so we can start selling premium support plans and subscription style offerings.

[Future Jeffry Note: I often use 'we' a lot when referring to the company, because I consider as eparate entity than myself. But I am the only employee]

4. What advice can you give developers who would like to start selling components, or code-related products (as opposed to just providing coding services) Your answers could be as short or as long as you wish - the more information the better, I just don't want to be a bother:)

I can offer a lot of advice for developers.

First, they need to realize that it takes more than good programming to make a business work. You'll need to learn about marketing, and cash flow, and customer support, and project management, and taxes, and dealing with the competition. How are you going to make money? Who are your customers? What need are you solving for them? Do you know what you're really selling? It is probably not components. Flextras is selling time. Instead of taking 3-6 months to build something, they buy it from us for a day's wage. The savings to them can be significant. But, only If we can communicate the value of our offering.

Second, you need to be aware of the market you're in. We live in an age where digital bits are infinitely replicated and easily distributable at nominal cost. It has happened for the music industry, and it is happening for the movie industry. Software won't be far behind. A lot of business models focus on using Digital Rights Management to make an infinite good scarce. That is why you can't watch Hulu on Google TV, for example. That is why I can't install Photoshop on both my laptops.

DRM is an annoyance to customers and does not stop the pirates from getting at your content. Think twice before you go down that route. Instead of trying to limit your customers, what can you do to use these promotion mechanisms to promote your business? A good business will focus on selling scarce goods, not easily replicated. Many software companies make their money by selling support contracts and giving away their software for free. I call that the scarce good of "access". Another scarce good that I think will be of interest to software folks is the ability to create more. Perhaps people will pay for future updates, or new product. The cloud business model is to sell access to a server somewhere that resides your data. It is something that is not as easily replicated as a boxed software product.

Finally, I'd say be sure to ignore the experts of your field, including me. They'll often tell you your idea sucks or can't be done. The biggest changes are made by the people who didn't know enough to know better. I'm never comfortable moving forward with an idea until someone tells me it's bad; because then I know I've gotten at least one honest opinion about my idea.

[Future Jeffry Note: I'm posting this in late December, with a release date of February. I just wanted to get it out of my "list of things to do" and I thought it might be interesting to some]