A lot of people are dreaming about starting their own business. Somebody lefts a job and starts working on himself, building his own business. Somebody starts side projects, parallelly working on a full-time job, building side hustle after work.
Startups’ success stories are everywhere nowadays. Airbnb, DoorDash, Slack, and Uber tell us that you need to solve real problems for your users. And everybody who doesn’t follow this rule goes to the 42% club (42% of startups die because of no market need). Unfortunately, there are still a lot of entrepreneurs who are building their apps, websites or services without validating the market demand and designing solutions for the problems that don’t really exist.
One of the best ways to be sure that your solution is viable — solve your own problems and use your product/solution by yourself very frequently. In the article, I will show such examples that started from own solution but later lead into multimillion-dollar businesses.
Another case of validation — to find people who really love your product and use it every day. They can invest their time (use very often) or money (pay for it). Both options are a validation that your product is needed, and you can build a business around it. Btw, we had an article dedicated to this question (take some time and read this article too, worth your time).
Many great businesses started as small, part-time projects. Let’s look today at the 10 successful startups that started as a side project, validated demand, and grew into the popular services that we use now.
Before GitHub became the billion-dollar company it is today, founders Chris Wanstrath and PJ Hyett were building websites on Ruby on Rails for CNET, the tech news and review site. Wanstrath and Hyett wound up making a lot of improvements to Ruby on Rails itself. Following the then-dominant model of open source development, Rails was managed by a cadre of trusted coders who’d been given permission to “commit” changes to the project’s source code. To get one of their changes added to the central code, guys would have to lobby one of those trusted coders and convince him that their change was worth integrating. That was often more work than writing the code in the first place. So they were very upset with how difficult it was to change open source code and decided to build their own repository, working nights and weekends.
If you aren’t familiar with GitHub.com, it’s a service best thought of as Facebook for geeks. Instead of uploading videos of your cat, you upload software. Anyone can comment on your code and add to it and build it into something better. The trick is that it decentralizes programming, giving everyone a new kind of control. GitHub has shaken up the way software gets written, making coding a little more anarchic, a bit more fun, and a lot more productive.
As of May 2019, GitHub reports having over 37 million users and more than 100 million repositories (including at least 28 million public repositories), making it the largest host of source code in the world. In 2018 Microsoft acquired the company for $7.5 billion. Not bad as for a side project.
Trello (well known as a free collaborative task manager and productivity tool, great for visually managing team projects and keeping track of your top priorities) was born as an internal project inside Fog Creek Software, as a way to solve high-level planning issues within the company. Around the summer of 2010, Fog Creek Software starts doing regular Creek Weeks, inner explorations for potential products. In January 2011, a prototype that hopes to solve some high-level planning issues was pitched. It’s called Trellis. Full-time development begins soon after. After solving their own pain points and rolling out a minimum viable product to a closed group of beta testers, Trello launches at TechCrunch Disrupt in September of 2011 with apps for the web and iPhone (some name ideas were Cardvark and Planatee, but the team decided to choose the name Trello). In the summer of 2012, Fog Creek co-founder Joel Spolsky’s dog Taco becomes the official Trello spokes-husky, the same year trello reaches 500,000 members. Today this SaaS tool is used by millions of users from around the world, and in 2017 was acquired for $425M by Atlassian.
Everybody knows Gmail as a monopolist on the market of webmails, although it was not the first service on the market. In 1996, Paul Buchheit began to build webmail, but he failed several times and stopped. In 1999, Paul joined Google as a 23rd employee.
In August 2001, he received a specific task from top management — to create webmail. “Larry Page said that ordinary Internet users in 10 years will be like us, so we focused on solving our own problems with emails.” From 2001 to 2004, they created several revolutionary features (the first in the world):
- advanced search in Google-style through all user’s emails;
- this led to the decision to give each user 1 GB of space for mail.
- Hotmail and Yahoo had a very slow interface at that time, which, after every click, reloaded the whole page again and again. The Gmail team developed a completely new technology called AJAX, which worked so fast in the browser that it was comparable in speed to desktop software. Later, AJAX became an industry standard — now every website uses this technology to make UX better.
- grouping emails with the same subject/sender into a convenient conversation thread in which duplicate text was automatically hidden.
- while other free email services showed ads as large flashing graphic banners, Gmail showed small text ads.
At the beginning of 2004, Google started testing Gmail on other employees, and almost all got hooked. On April 1, 2004, Gmail notified the press about the public launch of the service, but in fact, gave access (invitation code) to only 3000 users (because they physically could not support more users at that time). The limited access trick played very well, causing a stir that goes so far that people started selling invitation codes on eBay for $150 apiece. Gmail gradually increased the number of invitations issued as technical power increased.
In February 2007, on Valentine’s Day, Gmail opened public access to its service. From that moment, the Internet exploded in a viral storm of word of mouth. The user base quickly passed a million. Today, Gmail is actively used by more than 1.4 billion users per month.
When Craig Newmark started Craigslist (1995), he was 40 and starting over. After 17 years of working at IBM, he was offered a job in San Francisco Bay Area, and he decided it was time for a shakeup.
The job kept him busy, but he’d make time for local programming events where he met others in his field and kept track of what was going on in the industry. Pretty soon, he was a regular at the meetups and thought, “Hey, there should be a way for everyone to keep up with what’s going on.”
As a software developer, Craig was a techie, so he started an email list where he and his friends could update each other about different events going on in town.
It was a hit, and lots of people started using it. It was perfect for Craig-a fun side project that didn’t take too much work. He spent his days banging out work at his day job and his evenings managing “the list.”
After a while, people started posting about other things. When someone was moving, they’d notify everyone their apartment was available and maybe sell some of their furniture. They bought cars from each other and listed jobs for their employers.
When there got to be too many emails crowding everyone’s inboxes, Craig decided to make a change. He shut down the email list and moved everything to a website.
Picking the name for the URL was easy-Craigslist. And, as a fun and rewarding side project, he kept working his day job for three more years before thinking, “Hey, I could probably do this Craigslist thing full-time.”
It didn’t become a web-based service until 1996 and only started expanding to other U.S. cities in 2000, after Newmark built a talented team to help scale the business.
The net income of craigslist as of today is $500M. What’s interesting? Craigslist still operating with only 50 employees.
It wasn’t very long ago, but the year 2006 was a very different time when it comes to technology. Facebook was still getting started, and virtually no one had a smartphone. But Jack Dorsey had an idea. Wouldn’t it be cool, he thought if there was a phone-based social network that would let your friends know what you were doing in real-time? If you were having drinks at a local bar, for instance, or watching an exciting basketball game, you could post it on Twitter for your buddies to see.
Back then, Dorsey worked for a podcasting company called Odeo. Podcasting was just starting to gain popularity, which put Odeo in a strong position to cash in on the phenomenon. Unfortunately for them, Apple also saw the potential in podcasting and built it into their hyper-popular iTunes software.
Once that happened, the Odeo founders knew their business was in trouble, so they had a brainstorming session to look at other business opportunities. Dorsey pitched his idea for Twitter, and his bosses liked it. While they continued their podcasting efforts, they gave Dorsey the go-ahead to start developing his concept on the side.
It’s a good thing they did. As Apple’s podcasting platform wiped the floor with the competition, Twitter took on a life of its own.
In the intervening years, Twitter has grown with new technology, but it’s still about getting a short message out to your followers. Today, Twitter has over 330 million active users and worth about $26B.
6. Angry Birds game
It might be a familiar progression, that happens in many startups. Three guys open a company, hoping to make a hit game. They launch one, two, three; five years go by, now they are launching their 51st game. And it’s still not a hit. Funding slowly runs out. They are staring bankruptcy in the face. They don’t want to shut the company down. What if they still can make a game that will capture people’s imagination? They go back to the drawing board. They keep believing that they could capture that imaginary character that people will believe. Maybe if they can just get into the zone, unlock their inner humanity, they can think of a picture that others will believe is real. They take a methodical approach — they ask the designer to pitch ten ideas a day. It is 2009. As the days roll on and the funds run out, they conceive a make-or-break plan: make a game for the new hot device — the iPhone.
Daily, the game developers generate ideas and pitch them to the management. So far, they’ve rejected all of them. They are either too complicated, too simplistic, or just outright boring. It was around this time that a 30-year old Rovio game designer Jaakko Iisalo was home alone, his wife had gone out for the evening. Iisalo settled down to play some video games, as he often did when he had free time on his hands. In the background, though, a strange idea began percolating. As he started seeing it in his mind’s eye, Iisalo turned on Photoshop and sketched out a bird with large eyebrows, no feet, and a somewhat deranged expression. Iisalo thought nothing of the bird at the time. When his wife came back home that night, he didn’t even mention it. But when he showed the bird to the management, the presentation turned into an Aha moment for the whole company. Looking at the bird, even without knowing the point or the mechanics of the game, they already found it irresistible.
Rovio’s 52nd game was launched. The rest is history. Now we can ponder if trying something for the 52nd time is ever a good idea.
Kevin Systrom (co-founder of Instagram) had an idea. By day, Kevin was a marketing genius; by night, he was learning how to code. Systrom saw the recent success of Foursquare, so he made his own version called Burbn.
Burbn allowed people to check-in where they are on their app, but, there was one slight problem. The app received little attention. Why would anybody want to use Burbn over Foursquare? But, Kevin had created a small feature in Burbn, which was to photo share. It was a part of the business on the side. The few users of Burbn were using the photo-sharing feature heavily.
More interestingly, the users weren’t using the photo-sharing feature for its design but rather using it to share mundane photos of everyday life. Kevin pivoted towards creating a photo-sharing app and changed the focus to mobile photography.
At a party, he met his old friends who worked from venture capitalist firms and started to discuss Burbn. In the next few days, Kevin would raise $500,000 from those firms.
He assembled a team, including Mike Krieger (co-founder of Instagram), who had a wealth of coding knowledge and had worked on a photo-sharing project for a University class.
Systrom and Krieger decided to change the name Burbn to Instagram (which comes from the words Instant Telegram). Instagram became a sensation. It reached 1 million users in the first two months and was highly addictive.
In 2012 Facebook acquired Instagram for $1B.
8. Product Hunt
“I wasn’t an engineer, so I wasn’t going to invest the time or money in building an entire site from the start, but I could build an email list really easily. I started one and invited a few dozen investors, founders, and other friends of mine who I thought might like this, and who had an inside track of what kind of tech products were cool.”
Ryan Hoover (founder and CEO of ProductHunt) started this successful tech discovery website that was acquired by AngelList back in 2013 as nothing more than an email list between friends to share cool new products with each other. From there, Hoover would share new products his community discovered on Twitter, Quibb and other entrepreneurial online communities, which helped him acquire his first few hundred subscribers.
Do you need to be technical to start a tech business? What about one that’s based around uncovering the latest tech tools? For Ryan Hoover that was never a problem. Instead of agonizing over the technical aspects of his side project idea, he decided to do what he knew he could.
In the few years since launching, ProductHunt has grown into a community of hundreds of thousands of monthly users and sold to AngelList for $20 million. Also, keep in mind that even if you are an engineer, choosing to consciously make the switch away from actually building and instead toward managing a team of developers working on launching your side project might be the best course of action in terms of utilizing your own limited time resources.
Little over 3 years ago, Mikael Cho and the team at Crew started Unsplash, a weekly roundup of quality stock photos, as a side project to help grow their primary business-a high-quality community of freelance designers and developers for startups to tap into. What started as a Tumblr blog with Dropbox links, Unsplash barely worked on day one. However, they chose to focus on engaging their existing community and within a matter of a few months, Unsplash had received over 1 million downloads, all by word-of-mouth. Cho cites this side project as having saved Crew from nearly running out of cash, and it’s now spun off into its own business.
With more than 150,000 active members in the digital marketing space, this online community is a great example of how powerful it can be when you listen to what your audience is asking you to build. GrowthHackers was created as a side project by Sean Ellis while working together with fellow growth marketer, Morgan Brown at Qualaroo, a customer survey startup. The duo has recently taken it a step further and built a suite of growth collaboration tools called Projects, for their members to test, apply and track the success of the growth tactics they’re learning within the community.
These examples are living proof that even if you’re already running your own business, choosing to proactively build side projects that solve both your own problems and those of your community can lead to unpredictably exciting opportunities.
Let’s look at some of the key takeaways:
☑️ A. Build something you would use
“The best way to come up with startup ideas is to ask yourself the question: What do you wish someone would make for you?”, Y Combinator founder and entrepreneur Paul Graham wrote back in 2010.
Another, more commonly heard way to say that is “scratch your own itch.” What problem led you to think your side project was a good idea for yourself? Are there other people like you?
Whatever itch you’re scratching, there are more than likely a few more people out there feeling the same way. Don’t discount your side project idea just because you think you’re the only one scratching.
☑️ B. Listen to the market
“Give the people what they want”. It’s an old show business platitude that is the secret sauce of many successful side projects.
When you’re running a company, it can be easy to get tunnel vision. You’re so sure of what’s going on with people and that you’re building something for them that you forget to take a step back and listen. But some of the most successful side projects came from listening to what users and the market wanted and then building something just for them.
When Twitch first started out, the gaming community was never high on their list of priorities. But when they started to see more and more people livestreaming games on the site, they knew that’s what the people wanted. When Groupon started as The Point, it wasn’t trying to make money, but rather to support social causes. But when a group of users banded together to buy an item in bulk, they saw the potential of what it could be.
☑️ C. Get your hands dirty
“Don’t be afraid to bite off what you don’t know you can chew. You’ll learn to chew it.” That was the wisdom that made 19-year-old university dropout, and Gumroad founder Sahil Lavingia leave his position as the first designer hired at Pinterest to build his side project full time.
The truth is that every major startup mistake can be counteracted by simply just trying. Try your idea on a small scale and see if it works. Set up a landing page or some blog posts, send a cold email to 100 potential buyers in your target market and see if they connect with your idea. If you need to take a pit stop and learn more about the right way to pitch your idea to your prospects, pick up a sales book, take an online course, or find a mentor who can help accelerate your knowledge and get you to your first sales.
Side projects are the ultimate way to try before you commit your life to your next idea.
☑️ D. Teammates & partners can validate ideas as much as users can
A lot of startup advice hinges on validating your idea with real users. Which is important. But when you’re looking for side project ideas, or simply want to know if what you’re doing is on the right path, it’s also good to look inside. Talk to your team, employees, and partners about what problems they’re facing, even if it’s unrelated to your company.
For Noah Kagan, the idea of AppSumo came from talking to users at his other startup, KickFlip, a payment company for social games:
“I started AppSumo since every game company kept mentioning they needed less monetization tools and more customers. We wanted to solve that for the apps market.”
☑️ E. Timing matters
The best thing about side projects is that you’re usually under no pressure to get them out. That doesn’t mean you want them to sit around and gather dust while you “wait for the right time,” but simply that you can make sure that you’re focusing energy on your idea when it has the best chance of success.
Side projects are a chance to explore the future — to use the most relevant tools of today to build apps, create products, and manage projects to completion that people might not even know they need yet. Just look at Instagram, which started because of the hype around location-based services like Foursquare, but then pivoted into social photography just as the space was exploding.
Or Unsplash, which came out just as people were finally at their wit’s end with stock photography.
These all happened because their founders were looking forward, while keeping an ear to the ground and making sure that when they put their energy into their side project, it wouldn’t be wasted.
Side projects are an incredible source of inspiration, a way to experiment, and in many cases, better business ideas than the ones you’re going after right now. So why not give them a chance?
There are millions of successful businesses you’ve never heard were built in someone’s spare time. Just think about it. Who knows, maybe one day your side project idea might be on this list 😉
Need some help with your idea? We offer free consultations for startup founders. Just book your time via the contact form ✌️
Originally published at https://www.molfar.io