Vlad Mazek – Vladville Blog

Yes, I’m alive. No, I have not suffocated under the pile of money we made in Q3 and ExchangeDefender is well on it’s way to being a defacto security platform with 5.0 release coming-any-day-now-Duke-Nukem-Forever-style.

Yes, that’s really me on Facebook. Yes, I’ll be your friend.

Now that’s where the good news ends, at least for me. I’m back to the Ironman mode, working about 12-20 hours a day. On Friday, I started my vendor tour at ConnectWise trying to solicit feedback and figure out what the next 5 years holds for us.. because the IT industry as a whole is dying.

Now dying could just be consolidating. It could just be outsourcing. Whichever way we look at it, the road ahead has far fewer players with far less profit margins for premium products and the traditional way of marketing ourselves is just not going to cut it anymore because competing with free is just not a possibility.

But what if free lead to product differentiation and instead a marketing upsell opportunity?

Here is the bottom line: everything is trending towards free. And given the option of taking a freebie or paying for something, almost everyone would try the free route first. What do you have to lose? If you really get what you pay for, all you have to do is pay a little more than $0.

Our partners and vendors need to get aboard with a plan to cross-promote ourselves.

If you work with us or we work with you, please reach out and find me. If you don’t work with us then this is probably one of those posts I’ll be linking back to a year down the road to explain why things are the way they are and how early you had the opportunity to do something great.

I read a lot of self help books.

Not because I really need help, mostly because deep down inside I’m pretty sure I’m an idiot. Just not quite sure about the extent of it. So it’s nice to have it pointed out.

I also happen to work between 12-20 hours a day. Not because I don’t have any other employees here. Not because I’m a sociopath. Not because I’m not focused and watch Youtube videos all day long. Not because I’m a control freak and can’t trust anyone round me. Not because I hate life and everyone around me. Simply because I like to make sure we do our very best.

So… let’s try to defeat everything with random objections and arguments:

If you don’t focus, you’ll never get anything done. But if you just focus you won’t take the time to consider things thoroughly and the end result will likely flop. Your career/job/company has a shelf life so you have to move quickly! But move too quickly in the wrong direction and you just might bet on the wrong horse leading you to doom. If you just got organized there would be no stopping you. But if you spend all your time organizing things and filing them properly, you’d have no time for anything else (same applies to developing procedures, measuring activities, any analytical work of any kind that doesn’t directly result in you getting paid).

Aaaaaaaaaaarrrrrrgggggghhhhhhhhhhhh!

So, the point of this whole thing isn’t to show that cynical people never get anywhere. The idea is that the evaluation process is continuous and that you really have 3 options: 1) Settle for mediocrity / gamble / wishful thinking, 2) Work and hope that effort somehow trumps talent or 3) Try to make #1 sound a little more sophisticated.

Now, I don’t want to make it seem like option #1 isn’t successful. It is! For everyone from professional athletes to lottery winners and even curiously deformed rappers. Unfortunately, you probably don’t belong to that pile.

Yet, most people are in group #1..

How do you go from the first to second? Stock up the fridge with Mountain Dew and take up heroin? How about… try to think outside the little box you’ve got yourself stuck in? Ask questions. Ask followup questions. Share ideas. Ask for ideas that people get while listening to your ideas.

Here, I’ll get you started with something.

You work in an office. Or at least interact with clients. Right? What’s your policy on working from home? Tough you don’t have one, come up with one now. Why not? Oh, you don’t think you’re affected? Two of my close friends got taken down by the swine flu bug. One in Australia, likely chasing down a Kangaroo.. Other in Dallas, cornered by a client in a small server room and then told an hour later that he had to go visit his wife in the hospital because she is down with the flu.

Consider all the ways getting the swine flu would impact your business and career. Write down your objections. Write down your recommendations. Ask all your employees and clients to do the same. Even if it’s black and white, will never change your mind in a billion years, write it down. Come up with a strategy.

Apply above to everything you do, or should be doing. Even if you can’t have it implemented today, time has a way of helping you perfect what you really need to do.

This self help book is brought to you by me taking a moment from the crap I do to consider and share what’s on my mind because it gets me attention. Lot’s of it. And that attention constantly feeds back information and insight that fuels Own Web Now. Yes, without a single ad to it, or a fire sale, giving away a thought materially impacts the Vlad’s Ferrari Fund. But hey, you can always do something tomorrow right?

As my buddy Alex Rogers from Chartec would say, you’ll need to turn down your sensitivity meter.

“You shouldn’t do business with assholes.

You are in business to make money, not take abuse.”

Sign of business maturity is when you can focus on your business development and growth, without compromise that you had to make during the startup stage.

You know what I mean: You’ve taken someones money to design their web site in the past. If you’re the one person that didn’t, substitute an equally slimy task that you knew in the back of your mind you shouldn’t have welcomed but you did because you needed the money. We’ve all done it, it’s the core of entrepreneurial spirit and capitalism – sometimes you trade your comfort temporarily for the bigger payoff in the future.

Many people become complacent and forget that the discomfort is a temporary measure to achieve goals. They get emotional, stubborn, refuse to change, make tons of excuses for something they know they shouldn’t be doing. Yeah, I’m talking to you. When you started your business, was this what you signed up for? If you work for someone else, was this what you thought you’d have to put up with to get paid?

Vision.. Mission.. Values.. It’s what the business is built on. But much like any other building, it has to have retrofitting, cleaning, pest control, upkeep and occasional demolition.

I can’t read between the lines Vlad…

Earlier this week, my company decided to end the deadbeat abuse. Over the last year as my company grew by the leaps and bounds, collections became an actual automated role within OWN. We came up with the process, enforcement, followup measures and even concessions we were willing to make in order to get paid for the service that we were providing.

Let me dumb that down for you.

We made it easier for people to fuck us out of the money they legally owed us.

We had people that would loudly dispute their unwillingness to pay the bill. Really!

One deadbeat from UK went so far to refuse not just to pay but ignore phone calls, 10 days worth of followup email, support request updates, etc. When he was cut off, he sent a small encyclopedia alleging abuse, lies, theft, demanded proof that he owed money.

Oh, the humanity!

How was this gentleman confused? Well, in August he had dodged the bill for 25 days. On 26th of August, when we finally collected the amount that was owed since the 1st, he assumed that was a charge for the 1st of September. He also happened to be delinquent 6 our of 9 months in 2009.

Who, in their right mind, would put up with this? Not just the deadbeat, but the abuse that comes along with it. The blame game and victimization from someone who knows full well they are taking advantage of the process because they have more time than money and are simply trying to take advantage of the system.

We all have clients like that.

However, our reporting is typically not thorough enough to isolate the abuse. Why? Because scumbags are craftier than programmers. Yesterday saw a story on TV about how a crime syndicate would print fake UPC codes they purchased on eBay, slapped them on Target items, carried hundred dollar items out for $5.99 – $6.99 and then sold them on eBay and craigslist for the difference. That is a crime.

When the same thing happens in our business, white collar abuse of information employees, it’s discarded as a difficult client. Oh Bob, he’s just fiery. You have to know how to work with him.

This is where Karl says… Bob, you’re fired.

So…

Sometimes it’s hard to look at numbers black and white and just slam the door shut. But it’s your business as a business owner to assure it’s survival, pay your employees and deliver a sold service to your user base.

You can do so without being abused.

Your employees shouldn’t be yelled at.

You shouldn’t be The First Bank of Vlad.

You shouldn’t waste your time charging fees for people that ignore bills.

You should just run your business and focus on your product and service.

It’s not really that black and white, cut and dry.. Many people talk about how a business needs to constantly kill it’s C clients and focus on A clients. The reality though is that a corporation is really just another person. And how that corporation behaves in the marketplace is a reflection of it’s ownership: Do you want to be the abusive guy who only takes and throws people off the bus the moment they are not useful.

What I’m getting at is that there is a delicate balance between doing the right thing, being compassionate for the client base that may be down with financial issues as well as being tough with the people that abuse you.

As for us… We axed deadbeats. It took us exactly 2 days to make up all the business that those clients were bringing to us. Considering the amount of effort, abuse and general crap we’ve had to put up with and beat down staff.. 2 days of revenues is a small thing to part with to have efficient employees and a focused company.

Do likewise… Oh, and if you were offended, “Karl” has no relation to www.smbbooks.com where you can find many great SMB books, as all characters depicted in this blog are fictional and any similarities are purely coincidental.. but you should still buy Karl’s books and come see Karl and me LIVE in Chicago, next Wednesday at the Marriott O’Hare.

My last few points have raised a lot of interest. In the past week I’ve received more mail and direct contacts than I’ve received in all of 2009. At first I thought someone had broken my captcha and just slammed my Contact form, but almost all the messages are legit and someone took their time to voice their concerns. Interestingly enough, most of the mail came from people that do $0 worth of business with Own Web Now.

So since my decision making within Own Web Now makes no material impact on the overwhelming majority of people that read this blog, and that chose to contact me outside of public comments, what about me and my decisions is so interesting?*

Love or hate the Vladville act folks, it’s a reflection of the IT market. As much as Susan would like to believe that I’m just having a bad day, or that this is just doom and gloom, most of you seem to relate more to the tough market realities than to OWN’s success with the new portfolio we launched last summer (and the portfolio that your peers are overwhelmingly successful with). But this isn’t a sales pitch. This is a mirror:

The first ugly truth we have to admit to ourselves is that there is danger in self-selective sampling.

I can tell you that the world of cloud services is the future – we’ve made millions, as have our partners. Karl Palachuk (smbbooks.com) will on the other hand tell you that the future is in a mix of on/off premise infrastructure managed by the partner and owned by the client. My friends at CharTec (AARC) would have an all together different story. And Susan Bradley would likely throw some holy water on the cloud while screaming “Devil be gone, devil be gone” out of one side of her mouth while saying you need to make the ultimate decision after extensive research you conduct on your own.

And no matter which side of us you find the most familiarity with and choose to agree with because it gives you the most comfort… you must accept one thing: that we’re all assholes because while we slice and dice a few million accounts, Gmail and Hotmail are signing up 200 million users a year.

You see, 100% of the people that own their own office that Karl manages to find his way into will place value on the physical control of their infrastructure. By comparison, most of my success stories come from people that are polar opposites of the people that Karl meets. I don’t believe the word “migration” should even be in the dictionary anymore, but I’m sure Susan would disagree. We all sample the people that choose to talk to us because our message resonates with them.

Meanwhile, in the real world, mutlibillion dollar companies are trusting their entire communications platform to the security and privacy-ambiguous web site that randomly takes an hour or two off and make billions of dollars giving it away.

Hi, My name is Vlad, and I’m an ass.

I know I’m wrong. That’s why I’m still working. One of the most valuable things that we did this year was a big SMBUP (“Smack My Bitch Up”) session in which I took people on my staff around Microsoft WPC and had my partners beat them up about the stupid things we did.

Things started off nicely: “It would be nice if you could generate the report of consolidated user counts” but about 40 minutes into it when they were no longer concerned about being polite and only wanted to get stuff done the tone changed to: “You guys suck, every response is dripping with insults and you make us feel like idiots.”  [EDIT: Since I’ve managed to offend Wayne I think an edit is in order: These guys are my friends first, customers second. So while they tend to be open with me, rarely do they take the opportunity to totally unload their frustrations with my company on me – which sucks to hear, but helps give me extra motivation to fix things, quickly. We should all be so lucky instead of sticking to our notions of what majority of our customers are saying]

All day, every day, I hear about how great we are. Every day I have one negative review followed by a few dozen “Thank you for making my business so successful”; That’s why my buddy Mark calls me the most sadistic piece of @#%@ he’s ever met – I don’t respond well to positive feedback. I know we rock. Thanks. That’s why I work 60 hours a week. Tell me what’s wrong.

Most people don’t like to hear that. I’ve had people quit and crumble under the pressure and negative reviews. Life is tough, you don’t get rewarded for meeting expectations. That’s for minimum-wage-earners.

I want to be the best: So I decided to expand my circle of bag punchers and keep on improving my company. In doing so, I uncovered a huge opportunity to grow my company and help my partners. And no, I am not about to go open it all up right here.

So what now…

Start thinking.

What are you not doing that would appeal to the wide audience that you aren’t serving (but someone else is). That’s where you need to be.

Here is where we are now, here is what works in the MSP world:

“Second, the products that we use for our MSP offering have evolved over time and fit our pricing model (cost per workstation, or cost per server).

It has taken us 4-5 years to get everything in place, but I am always open to ways to improve my service and possibly save money with different products, although saving a few pennies or dimes at the expense of fewer features is not what we do.”

Folks are selling stacks. One stack, one size fits all – pay more for an XXL size but otherwise if you aren’t buying our stuff…. hit the road.

That worked well up till now. Not so much going forward folks.. so… how do you change it?

Welcome to Vladville. This is typically when I’d get on a long-winded, insult-laced, grammatically-abusive explanation of something very obvious and basic. Really, common sense that is apparent to anyone that took more than 5 minutes to think about things. But let’s spend that time in another way.

Assume things aren’t getting better in this economy.

Assume things won’t get better soon; assume they get worse.

Assume your ability to make the kind of revenues you are making now get cut by 20%. 30%. 50%. 80%. Assume you have a six figure job, that will next month be done by someone out of Phoenix for $11.75/hr.

What… do… you… do?

And now… Mr. Justin Timberlake sings to the MSP industry:

About a year and a half ago my company took an amazing risk to go into the cloud services head first. We took a ton of partners with us. Scary proposition? Hell yes. At the time our #1 product was a $300/month dedicated server running Windows / SBS / Linux at a profit margin that made our $10/10GB Exchange 2007 + SharePoint something that was very hard to stomach. We were trading a ton of dollars for a handful of pennies.

At the time most of our partner base decided to sit on the sidelines, wait and see. More ignorant ones were boasting about how many people they were disconnecting from the cloud and moving them to on premise solutions. Most of them are not around anymore.

Fast forward 1 year. Our growing products are ExchangeDefender (more on that in a moment) followed by Exchange hosting.

Now here is the kick in the pants.

Do you know what the #1 protected IP range on ExchangeDefender is?

Go ahead, guess. I’ll wait.

If you’ve guessed Gmail (Google Apps), you’re right. Yes, the same Gmail that went lights out yesterday for a few hours. Yes, the same Gmail that people pay $0 for is the #1 ExchangeDefender target because of our LiveArchive (Exchange 2007 business continuity suite) product. Yes, the same Gmail that you told your customers wasn’t right for their business that they eventually dumped most of you and SBS for.

Every day… every single day… we play Cry Me A River in the office. Because every day, without exception, I get to hear sob stories about how clients are dropping like flies. And every day I talk about how well we are doing and how things are growing in the cloud and how well the market is developing.

Yet, every day I get ignored. When I look at services for the crying partners, they haven’t added a client in the last quarter. Or even in the last year.

What’s it gonna take to have the folks face up to the fact that computing as we used to know it has changed? You’re already losing clients and sitting on top of suffering businesses while others are growing. Is being right worth the failure of your business?

Believe me, I understand. I understand the fear. It wasn’t easy for me to take the knife to my dedicated server cash cow and slaughter it for a few pennies. But a year later, we’re growing. Where will you be a year from today?

Wake.. the… FUCK… up!!!!!!!!