How Internal IT Software Can Be An Extra Source Of Revenue For Your Business
You don’t have to be experienced in IT or software development to build your own software company. If you have an existing company that uses internal software built in-house, you may already have a product you could sell successfully.
While internal software is typically kept secret—especially if that software is one of the reasons a business stays ahead of its competitors—it could also be a potential gold mine for business owners who want to license and distribute it. If you have software that solves common problems in your field, you may be able to reposition your company as a software vendor to your competitors.
Let’s see how some non-IT companies are pivoting to software sales and explore how you might be able to follow suit.
How to sell internal software without experience in IT
Create a solution that doesn’t exist anywhere else
When Wix developed Wix Answers, their convenient and helpful tool that brings customers together with their support team, it wasn’t because they felt like developing a new platform on a whim. They did it because they needed a way to connect users to experts and improve their customers’ experiences with their existing product.
Wix Answers, meanwhile, became so useful that the company was able to release it to other companies as a help desk solution capable of supporting millions of users at a time. In other words, Wix was having a problem within their own business, developed a tool to solve that problem, and then released the tool to other businesses who were also having the same problem.
Use your own company as your test market
What better way to know that your software product works than to use it in your own business first, and see if or how much it improves your daily workflow?
Take the Toronto law firm Fasken Martineau DuMoulin LLP, for example. They developed an AI platform to automate routine tasks that their employees were doing, such as searching case histories for precedent that could help current cases, or performing a quick grammar and proofreading check on legal documents before they get sent out.
The technology worked very well. The law firm realized it would be helpful to other legal offices that also handle the same kinds of tasks every day. They began to market their AI platform to their existing customers, most of which were also law firms.
Continue using your software after you release it to other customers
The last thing your software users want is to purchase a solution that won’t be current for long. And, since your primary business is something totally unrelated to software, your customers might not be sure what to expect from you when you move into your new field.
Ease their concerns by continuing to use your own product in your daily business operations. Give your customers even greater confidence by using your IT solution in your new software venture.
When potential customers know that you use the software you are licensing to them, it sends a positive signal. Additionally, it reassures them that you’ll stay abreast of regular software updates, bug fixes, and other issues that may arise.
Hire the right team
When you own a business, you have a full plate already. Do you have the time to manage the development of a second company while you keep your first one afloat?
Many tech startup founders discover how important it is to delegate tasks to trustworthy managers. It may be initially uncomfortable to hand control over to a team when you were the first one who thought of the software solution. You’re more apt, though, to be successful with a supportive team than if you attempt to handle all the details by yourself. You also don’t want the new company to be bogged down by “the way we’ve always done it” that is sure to be part of the parent company. Startups need to move and pivot faster than more mature companies.
Here are some problems you may encounter when selling internally built software systems
Selling internal software could be a wonderful way to propel your company forward, but it isn’t a risk-free venture. Just because the software is developed doesn’t mean it’s a quick and simple process to make it available to customers. You should plan for and expect some hiccups along the way.
Each company will face unique issues, but these are the most common challenges business owners encounter.
Underestimating your competition
Microsoft, Amazon, and Google became tech giants for a reason. Each company is constantly developing new products, refining old ones, and testing the market to find creative, innovative ways to solve problems with software. As a fledgling software company, you’re going to be like a small reef fish swimming into deep waters populated with three big sharks. And that’s before you even take into consideration your similarly sized competitors.
You have a few key advantages working in your favor. One, you have a market primed to accept and value your product. You’ve already established that your product works and solves problems within your own company. But you’ll need to place that solution in front of other companies just like yours. Tapping into your customer and peer networks should help you get some traction for your new product.
Believing your product is ready for release when it’s not
Just because you’ve developed and used a software solution successfully in your own business doesn’t mean you can simply turn around and sell that software without any modifications. You will need to build in the additional or different functions that your potential customers need and the types of integrations they may require.
That means you should hire a seasoned product manager who can take charge of the development and release schedule just as any other software company would handle new product development. You’re not just a business releasing software on the side; you’re forming an entirely separate business venture. A new business requires experts to manage it successfully. It will have different customers, a different rhythm, and a completely different business model.
Skipping to the finish line
Your product isn’t the only thing that needs to be altered or reinforced before you can take your new software company live. The internal structure of your company may need to be modified to support the extra demands of running a second company under the same roof.
You should consider how your current business is organized and build a plan for the changes that you may need to make that could ease the transition to selling software.
Some of the things you should consider are:
- Do you have a team in place to maintain and update your software product?
- Who will be in charge of providing support when your future customers have questions?
- What portion of your funds will go toward the software side of your business, as opposed to the original product- or service-oriented side?
You should answer these questions before releasing your software to your first customers.
A business value transformation coach can help you avoid pitfalls
You might be able to modify your software for broader usage, market it to your intended customers, and navigate the technicalities of maintaining, updating, and selling your new product under the current umbrella of your existing company.
However, this venture is a completely separate business. If you don’t feel confident that you have the IT experience to build a new software company, it would probably be a wise decision to consult with an expert who can position your company and product successfully.
Frank Zinghini, CEO of Applied Visions, understands how to build and market a successful software company, because that’s what he does every day. Book a complimentary strategy session with Frank to explore how he can help you make your company’s value transformation.