I had the pleasure of interviewing Mike McDerment, the co-founder and CEO of FreshBooks, for Web Design Ledger.
FreshBooks is the #1 cloud-based accounting software designed exclusively for service-based small business owners, with more than 10 million users in over 120 countries. Mike has spent the last decade making accounting software accessible to small businesses and is the co-author of Breaking the Time Barrier, which helps professionals better price their services, and has seen more than 250,000 downloads since its release in 2013. A lover of the outdoors, Mike has been bitten so many times he is reportedly the first human to have developed immunity to mosquitoes.
Can you share a little about yourself and some history about how you got into design/tech work?
I started running events and building websites those events. Then my event caterer asked me to build him a website as well. After a while, I effectively started building websites for other people. The lead me to learn to program. I built a simple program to bill my clients with. This program eventually turned into FreshBooks and I ended up spending 3 ½ years in my parents basement to bring it to life.
As a creative, what inspired you to create FreshBooks? Was there any specific problem you set out to solve with it?
First of all, it was super time consuming to create invoices and bill clients. I was pretty inconsistent about it, I never knew where I stood and how much money people owed me. I had to do what I like to call, “forensic accounting” spent time doing lots of research checking my files and comparing them with my accounts. The worst was the thought of “I just don’t know” rattling in my brain keeping me up at night. because I didn’t know who owed me money and when it was supposed to come in.
What were some of the biggest challenges when first launching FreshBooks? Was it a difficult transition to juggle your design agency and FreshBooks at the same time?
I think one of the biggest challenges for me was the transition from two to three-dimensional design. Building products is very different from building an email marketing asset or direct mail piece there are a lot of other considerations. I knew how to get small business owners to market themselves, but not how to build a product company for myself. This was more like building a platform along with all these other things; it was all of series of steps and learning curves.
The good news is, what we lacked in knowledge, we made up for in the passion for what we were doing and the customers we had.
Was there ever a turning point that made you realize the significance of FreshBooks? When did you finally consider FreshBooks more than just a little project & start looking to hire a full-time team?
There were steps along the way. At the beginning, it was me and another guy. Within 2-3 months we realized this could be something interesting. Back in 2003 we didn’t know what we were doing and there wasn’t much online on how to build a company like this but believed this could be a real company. We had a consulting company on the side while we fired up FreshBooks and built it from there.
Could you explain your thoughts on “company culture” and how it can be fostered in a work environment? Do you feel that FreshBooks has its own unique culture?
We have this belief that it could be something, and when you act on a belief you don’t really know. I would say our “company culture” is very customer service oriented, we learned so much by listening to what our customer was saying. We designed a survey for our clients. Some of the feedback we received from a client was that using FreshBooks had changed his behavior; “I save time and get paid faster because I send my invoices sooner.” I immediately thought, wow that sounds like a great endorsement that really matters!
What are some vital management & marketing concepts for a successful company that designers/developers may not understand?
Research is a good one and a good marketing exercise. We started out by doing incredible customer service, by virtue of doing those things we got a within closer proximity to our customer, the closer you can be the better. The danger is to be too far removed from your customers and pursue your own unrealistic view. Constant interaction with the customer is really important. There is nothing like talking to the people that love you the most, to learn more about what you should do next.
As a founder who knows how to write code, do you think it’s advantageous for anyone launching their own product to learn how to build it themselves?
There is enormous value in trying to and build something for yourself. You start to understand some of the strength or limitations of what you do when you roll up your sleeves and do it yourself. I haven’t written any software for the company in over a decade. But knowing all the technical underpinnings proves invaluable for making good decisions today even if I am not the one doing the work.
How does one learn to delegate their workload and decide which tasks should be given to others? Is this a difficult process when growing a company to add real employees?
First thing, You can’t do it alone. It takes a team. The second thing is, and this was a revelation to me when I figured it out, there are people who love to do the things you hate. It is important to understand your strength and what you can do easily. There are things I am not efficient at, wich others actually enjoy doing these things and, therefore, are better at it than I am. Third, there was a challenge in getting out of certain areas of the business, having the patience to teach others to build their capabilities to your standard is important. Finally, you can’t absolve yourself of responsibility. It is important for a product to have to support but at the same time not metalling while helping people steer to the promise land.
What kept you motivated in the early days of FreshBooks, and what keeps you actively engaged in the company over a decade later?
Our customers and their feedback was huge. I love the day we launch something new! That’s the creative in me, I want to solve the world’s problems. Those things are still just as exciting.
What was the general process of getting the FreshBooks mobile app built & launched in the App Store? Did you take away any major lessons from that project?
We started our first mobile app way too early. Some of the tooling and best practices had not been created yet and the process was very expensive. We then got it right and build an award winner application. I don’t know if it has anything to do with the App Store, the hardest problem is being clear on what constraints you are building for yourself. Meeting those timelines and staying focused. That hard, but if you can stay focused and deliver you can take yourself wherever you’d like to go.
If you could travel back in time and give your younger self one piece of advice, what would it be?
There are so many new tools now that can enable you in ways that were not possible before. Mobile development is expensive and challenging, but I think we got a lot of stuff right at the beginning. I think anointing a design dictator who can make the last call on a design is very important because otherwise you can have log jams. This person has to be able to listen to others and not fall in love with their design. I believe design by consensus is a recipe for mediocrity. Simply having someone appointed with a design title is not the way to go about it. The kinds of instincts you need to be a great design dictator, those don’t come with a job title.
Download Mike’s Book for Creatives:
Learn how to charge what you’re really worth
Read this book and find out how you can earn twice as much as you do today.
Leave a Reply