Strategy, optionality and Managing Two Products at Basecamp

Strategy, Optionality and Managing Two Products at Basecamp.

We talked with Jason Fried, founder of Basecamp and Hey, in advance of his session at Business of Software USA Online to get some of the important but unnecessary stuff out of the way in advance.

Part 2 of 3 – here we discuss how Jason and David think about strategy and manage risk at Basecamp, and find out how they plan to manage two products following the launch of their new email service To see the whole discussion in one place, click here.

Or pick your topic…

Of course, there is plenty more to talk about and we’re looking forward to spending time with Jason and David Heinemeier Hansson, neither of whom are short of opinions, to delve deeper at Business of Software Conference Online 21-23 September.

You should be in the (Zoom) room where it happens.

Jason Fried Basecamp Hey

How do you think about strategy and optionality at Basecamp?

Jason: “The way I try to do this is try to project backwards, a year, extending from now and think about how I will look back on the last year. What am I going to regret? Don’t do that. I don’t do the things I’m going to regret. Basically it’s how I try to think about strategy. It’s easy sometimes to make decisions in the moment and not think about them in a reflective way.

“I try to do that because I don’t want to show up at work every day to do things I don’t want to do most of the time. Of course there’s always days to do things you don’t want to do. Of course a lot of work is monotonous boring stuff, no matter what you’re doing. I want to make sure that strategically, at the high level, we don’t make decisions we’re going to regret a year from now.”

How do you consider risks?

Jason: “Part of this too is about is about measuring risk. Thinking about things in terms of tradeoffs and making bets. Placing and taking odds. We don’t think ‘strategically’, we’re never interested in trying to be certain of anything. Certainty is not interesting to me. It’s a false hope.

“Most of the time and the amount of effort it takes to be certain is almost never worth the the extra work compared to a really good guess where you feel pretty good about the decision. So certainty is not something we look at. We’re always looking at trade offs and bets. What are the odds? Does this feel like decent odds? OK we’ll take that super, super, long shot. Maybe not. We’re always trying to think about things that way and I’m not trying to ever be that perfectly certain about anything we do.

“People often ask, ‘How do you know if this is going to work?’. The answer – I don’t know if it’s going to work. I’ll never know if it’s going to work. The only way I’ll know is if I build it – then I’ll see if it’s going to work. There’s no other way to know. So mentally we’re just not looking for things to be perfect. We’re not looking for things to be certain. We’re just looking to feel like it’s worth taking a bet on, taking a chance on, and taking a risk without putting the company at risk.

“It’s sort of how we’re always trying to think about how much risk can we take without putting ourselves at risk. If something went wrong with Hey and I had to lay off 20 percent of the company, I never would have done Hey. I don’t want to be in a position where I have to lay people off because of a decision I made about a product I wanted to do. If we felt that would be the reality we wouldn’t have done it. So we’re just trying to find out the right amount of risk for us.”

Hey – The stupidest thing we have ever done!

Jason: “I think Hey is the stupidest thing we’ve ever done. It could have been a big risk. I mean that in the best possible way. How we approached Hey is different on every level we’ve tried to make make it very different from standard email.

“I think talking about what it’s like to take a big risk without putting your company at risk is the deeper more interesting thing. We’re able to do that because we’ve built up Basecamp and it gives us cover to take a risk without putting ourselves at risk. I think that’s important because when you talk about risk with entrepreneurs, they think it’s like you bet everything. You always bet the company. I don’t want to bet my company unless I have to. I don’t want to get that wrong. I would love to talk with people at BoS about that.”

Managing Two Products at Basecamp

Jason: “And now we have two products, Basecamp and Hey. This feels like the right number. Four or five was too many, but two is good – because we can spend six months on Hey exclusively, learn a lot, discover a lot, and then bring those ideas to Basecamp and work on that for a while, bring those ideas back to Hey and we kind of go back and forth. We’re calling it ‘Tick-Tock’ development – tick tock, back and forth. And I think that that’s gonna be a really good pattern for us.”

Hiring and Growth

Jason: “We see the 70 employee mark as something that you would be able to run both services with. It’s a terrifying number to be honest. I don’t look forward to it. I look forward to the new people and everything. I don’t look forward to running a company of that size but maybe I’ll get used to it.

“We’re about to hire between ten and twelve people next year which is a hiring spree we’ve only done once before. We need to now with with Hey taking off.

“But I think that’s what we’re going to really need because next year we’ll also launch the new version of Basecamp and this year we’re also going to launch Hey for work which is the business version of Hey for multi-user accounts for multiple people to use it together inside of a company. So there’s going to really be almost three products. We’re going to need a bigger team. Right now we sort of held off on Basecamp to go all in on Hey, but we can’t leave Hey to go back to Basecamp, and we don’t want to work on Basecamp and then leave Hey there and vice versa.

“So we’re going to actually build up a couple more product teams and that’s what the additional hiring will be. Plus, we need some other expertise that we don’t have in the company today. And so we’re going to do that and have to hire customer service people. So we’ve got tens of thousands of new customers all of a sudden and so we have to do this. This is the stage we’re at right now.”

What’s the thing that worries you most? 😟

Jason: “I try not to get worried about work. What worries me the most right now is, we’re in bug fix mode. We just launched Hey and like there’s a lot of stuff that bubbles up after you do. We’ve had almost 200,000 people signed up for this thing in six weeks. It’s a massive amount of eyeballs and the sudden usage mean things bubble up.

“My biggest worry right now in the short term is that we’re going to stay too focused on trying to solve all the small things and not get back to building the interesting things that we want to do that we didn’t make in version one. This is one of the things that happens with product development – version one you get to build in isolation. You launch into the world and at that moment you’ve got ten thousand, twenty thousand, a hundred thousand opinions descending on you. This is good but also it means you tend to be forced to backfill based on people’s existing expectations. They’re bringing with them 16-20 years of email experience. They want to do everything they love and know. What Hey does they love, but they also want to do everything it doesn’t do because that’s what they’re used to.

“So my worry, and I’m working hard on this internally to remind people, is we should not give in to backfill mode and just try to shore up the basics with what everyone else wants. We made these decisions for a reason and this is where you can, very easily, very quickly, lose track of what you’re trying to do. We have a very strong point of view on this but when one hundred thousand other people also have a point of view it’s difficult to maintain your own point of view still.

“So that’s my current worry and my job in some ways is to protect. We have to fix things but also protect the vision. This is when the vision can get shattered very quickly and then you can’t get it back. So that’s in the short term and I’m worried about getting it right.”

To see the whole discussion in one place… Or pick your topic…


Of course, there is plenty more to talk about and we’re looking forward to spending time with Jason and David Heinemeier Hansson, neither of whom are short of opinions, to delve deeper at Business of Software Conference Online 21-23 September.

“Everybody who speaks about Business of Software speaks about it in a different tone. It is a special conference. People want to speak there. People wanted to attend that you come away knowing something or knowing someone differently. It’s wonderful.” Jason Fried

Learn how great SaaS & software companies are run

We produce exceptional conferences & content that will help you build better products & companies.

Join our friendly list for event updates, ideas & inspiration.

Unsubscribe any time. We will never sell your email address. It is yours.