This is a small company with exactly five employees, all programmers. When the dot com work began to dry up they started looking around for another revenue source. They found one in the web based project management tools they had built to manage projects internally.
They took their project management software and began offering it as web service that anyone could use. Their software is intentionally limited in feature set to minimize the learning curve. As anyone who has used, MS Project knows, the learning curve on modern project management software is HUGE. MS Project is the market leader in this market but 37 Signals has a great shot at achieving significant market share. There are several reasons for this.
- The old WordPerfect study. It's pretty simple. Word Perfect found 90% of the users use roughly 10% of the features. That means that for most people, Textpad is more than sufficient for their needs. Without the huge investment of learning the program, most users can be more productive more quickly. Spend more time working and less time working with management tools. Here's their philosophy,
"We believe software is too complex. Too many features, too many buttons, too much to learn. We build products that do less, work smarter, feel better, let you do things your way, and are easier to use."
You know what, they are right too. - It works simply with a browser. 37 Signals is a big advocate of Ruby On Rails and with AJAX are able to provide a solid user experience. As it's browser based it's platform independent so it works pretty much the same for everyone.
- MS Project is built on the MS stack. In other words to use the full features of Microsoft Project you need Microsoft Office Project Server. In short, you really need to be a Microsoft shop. 37 Signals can work on any modern browser. These means no license management and no head ache. Project is still far to desktop-centric to be thinking this way. Furthermore a radical change like this would require MS to knife the baby and think outside the box. MS is too busy thinking how can we lock them in. This lockin requires that companies work around Microsoft instead of the other way around.
Projects and companies like this won't appear on the radar of Microsoft. Since they don't ship software, they don't really appear on the Project's product manager's radar. When they do appear, MS will undoubtedly put out a product spec sheet touting the number of features that Microsoft Project has. This is missing the point entirely. MS Project has too many features to be used effectively now. The learning curve is far too steep and it's far to MS centric to effectively compete.
Companies like 37 Signals are going to continue to flourish. It's a great time to be an entrepreneur. That's the subject of my next post.
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