Michael Cassidy, 36, cofounder and CEO, Direct Hit Technologies Inc.
What’s Your Problem?
“We created the Popularity Engine, a search technology that makes finding relevant information on the Net both quick and easy. We pride ourselves on moving fast, staying ahead of the pack, and always improving what we offer. The great thing about doing business on the Web is that you get so much feedback from your customers so quickly. But there can be too much of a good thing: If we can always make things better, how do we know when we’ve made something that’s ‘good enough’?”
Tell Me About It
“With traditional software, even the fastest companies need six to nine months to ship a product. But we might have just two months to get a product out the door. So we rely on fast feedback. We take a few days to build a prototype, we throw it on the Web, and then we track user behavior. After watching people for an hour — that’s one hour — we have enough feedback to help us improve the product. We can launch six or seven new versions within a few days. Then we face a question: Should we spend another two weeks on this, or is the product where we need it to be?”
What’s Your Solution?
“We make a ‘good-enough’ calculation that’s based on the economic value that our developers create, not on what they cost us in terms of salary. We launched this company a year ago. Today we can estimate a market value — based on the valuations of other companies in this space — of more than $100 million. That’s not a hard-and-fast figure, but it’s suggestive: You can translate that into more than $3 million per developer per year. That’s $250,000 per month, or $10,000 per day.
“If you think about software that way, you realize that even a quick improvement involves a serious investment. Whenever we consider how many resources we should devote to improving a product, we ask ourselves, ‘Do the benefits justify an investment of time by someone who’s worth $10,000 per day?’ That question focuses our attention on what’s important.”
Contact Michael Cassidy by email (firstname.lastname@example.org).