July 8, 2017

What was your last capital investment?

When was the last time you invested in something that helps you do your work faster?

I realize that you probably pay for the basic software required for your job, like maybe Sublime, or Sketch, or Transmit.

You might also pay for the communications software you use to work remotely with your clients, like maybe Slack, or Basecamp, or Zoom.

And hopefully you pay for professional services like accounting, bookkeeping, and payroll rather than wasting your time trying to do them yourself.

But I’m not talking about any of those sorts of purchases. Those are tablestakes for an independent software developer.

What I’m talking about is investing real money into something that decreases the amount of time it takes you to deliver your core work product to your clients.

What I’m talking about is like a “capital investment” in an old school industry. Like a retailer buying a new warehouse, or a manufacturer building a better factory, or a telecom upgrading an aging network.

If you bill by the hour, the answer is probably “never”. Why would you? There is no financial incentive for you to do your job faster.

If you do value pricing, it makes tons of sense to make capital investments whenever the opportunity presents itself. Over time, these kinds of investments are highly likely increase your profits, capacity, quality, reputation, reach, and so on.

And fortunately for software developers, they usually cost a LOT less than a building a new factory.