Giacomo Peldi Guilizzoni
Balsamiq

Giacomo Peldi Guilizzoni is an Italian entrepreneur that founded Balsamiq in 2008. Before becoming the CEO of his start-up, Guilizzoni worked seven years in the United States as a programmer at Macromedia and Adobe. He used the launch of Balsamiq to move back to Italy. Balsamiq is the market leader in web Mockups. In a period of only three years and with a very small team of nine people located all over the world, it has generated more than $6 million in revenue.

Pedro Santos: How did you have the idea for Balsamiq and what did you do to get that idea to actually to turn it into reality?

Giacomo Peldi Guilizzoni: I have to admit, I went back to my old blog posts just a few minutes ago to refresh my memory, because it’s been such a ride. I feel like I’ve changed so much since the beginning, which was only three years ago really. But it’s been a very interesting time. The idea itself, I don’t really remember what it was. I think it just came over time. It was a need that I had for a while for my day job at Adobe. I was a programmer and I’ve always been a visual person. I need to draw what we’re talking about or I’m not going to understand it.

So during all these meetings at Adobe I would just get up and go to the whiteboard and start sketching the user interface for whatever we wanted to build. And that really facilitated the discussion, of course, for every feature that we wanted to build, etc. Lots and lots of people do this all the time.

That was all good. I really liked to do that. The problem is that we started working with developers who were remote, mostly in India, and other remote people as well. Then there was the problem of how do we communicate with those people who cannot see the whiteboard?

Even for the people who were in the same office, after doing the sketch on the whiteboard I always had to go take a picture and then rebuild it. Or sometimes you’d go home and then you’d come back the next day and none of what’s on the whiteboard makes any sense. You forgot what that meant because they’re such scribbles.

Either you were in the meeting and your memory was fresh or you forgot it all. Because that’s what happens, whiteboards get messy pretty quickly.

So there was this issue that was bothering me. What I saw happen over and over was that we had to write specifications and I noticed that most people just looked at the pictures. They never really read the words. I noticed that the more pictures I put in, the more effective they were, so I started doing specs that were mostly pictures.

The problem is that it took a while to create those pictures. I used to use Adobe Fireworks, which is a great tool, but it’s not focused. It’s a generic drawing tool. So it took a long time to do these things.

Sometimes I would just code the feature instead and then take a screenshot, do the bare minimum in order to have the screenshot ready, and take a screenshot. And that would also take time.

Then what I noticed what was happening is that whenever you spend time with something, you start getting attached to it, and I saw it with other engineers as well.

They came up with a spec and it wasn’t very good. We had this feedback and they were resistant to make changes because it took so long to draw it up or to code it. Already they spent all this time on it.

So in the end what would happen was that we reached compromises to use what was already there and change it only a little bit. The end result is software that is not as good as it could have been, for reasons that have nothing to do with the customers. They were internal reasons, laziness, or human nature.

So I was like, “This is not good. The customers, in the end, are not getting stuff that we know can be improved. We should be doing our best, our very, very best.”

So I wanted to find a tool that was as quick as the whiteboard, as low fidelity so that people wouldn’t get attached to it, because it looked like it was just scribbled together, but also digital so that we could use it with remote people.

The other thing that I noticed is that we worked with some product managers who had great ideas and knew exactly what the customer wanted, but didn’t have the right tools to express those ideas.

They would just write down in text or spend hours in Excel or PowerPoint to try to create user interfaces. And it was just a waste of time.

I saw the need for a tool for business people that was as easy to use as PowerPoint, but designed to do user interface sketching.

I even taught a product manager that I knew how to use Flex Builder, which is an IDE¹ development environment, but it has a little visual designer. I was trying to find a solution to this for a while. I didn’t really consider building something until something related happened—which is that we started adopting wikis within our organization, and I saw how amazingly productive the internal wiki made our team.

It really made a huge difference to have the Web 2.0 way to work where everything is immediately editable within the browser. Nothing to download.

So we installed a few wikis. And we landed on Confluence, which is the wiki made by Atlassian, and it was such a pleasure to use and so great. It had one feature that I’d never seen before, which was that it was extensible, so people could build plug-ins for the wiki. And there are many extensions now. One of these plug-ins was Gliffy, which was a visual equivalent. It’s a diagramming tool and it was a commercial plug-in. We had to buy a license, which I thought was interesting. In a way I was suddenly … I had this epiphany with the wiki and the new way to work within the browser.

I felt like it was a no-going-back technology—like cell phones or hot water. Once you start working that way, you can’t really go back to e-mailing PowerPoint files back and forth.

So I was thinking, “I’ve got to get down this wiki train somehow. This is so powerful. It’s a shift and I want to work on this.”

Santos: And this was when?

Guilizzoni: This was 2007. Late 2007. And so, I thought I had to figure something out, because I wanted to work on this thing. And I saw that there was a commercial plug-in vendor for the wiki that was built in Flash, which is Gliffy. I heard that it was two guys and they were doing okay. And I thought, well, two guys doing okay, one guy that’s very happy. [laughs]

_________

I had never considered finding a co-founder. This was something that I wanted to do by myself for a number of reasons.

One was that you hear that ninety-nine percent of all start-ups fail, so I didn’t want to rope anybody into something that I was pretty sure was going to fail. And also, most importantly, because I was looking for a learning experience. I wanted to find out what it took to bring something from idea to market. All that it took. So, what are all the things required? I wanted to see what that was.

At Adobe, I was always a programmer, but I considered going into product management because I wanted to be exposed to the marketing, the pricing, the sales, the support, the legal.

There’s so much that goes on that is not code related that is fascinating to me. And I wanted to see what it was and how to deal with it, as I had read about in books.

But after a while, I reached the point where I could tell that I wasn’t learning so much from books and I had to take the dive. To learn it on my own skin.

So this all happened more or less at the same time I wanted to move back to Europe with my family, because I had a young baby and my family’s all in Italy and I wanted the support for a number of different reasons. Some were personal. And we decided to move back.

The other thing that you hear as an Italian expat is that, “Oh, there’s no jobs in Italy. What are you doing? There’s nothing you can do in Italy if you go back.” So, I thought I’d better come up with something for myself. So, that was the spirit of adventure that got me to decide to move back and start my own company.

Santos: Okay. And how did you implement this? So, you had the idea, you wanted to come back to Italy. After you decided to go back, how did you actually implement it?

Guilizzoni: So, I think it was maybe September 2007 when we decided, “Okay, we’re going to move back.” And I’m going to try to build this company around this product in order to enable that move, and to live on it. And so, I knew that my project at Adobe would hit a big milestone and we were going to ship version one around April. March, April of 2008. And so I said, “Okay, I’ll finish this project, and then we’ll move.”

And then the project was a little bit late, and so in the end, I ended up giving notice in April and working at Adobe until the middle of June. We moved back to Italy in May of 2008, and then, until the middle of June, I worked while they tried to hire a replacement and stuff like that.

But, basically, starting in September, I started putting away as much cash as I could because I wanted to have enough of a runway so that I could live off of my savings while the product was taking off. And I wanted to have a years’ worth of salary in the bank so that we could maintain our standard of living for at least a year after moving. And so, I sold all my stock options, I stopped putting money into my 401k. I basically started to get as much cash in the bank as possible.

So, in September until May there were eight months of doing this. Then I started working on the product at night every night from maybe eight o’clock to midnight. I would sit in the kitchen and start coding like crazy. And then on Sunday, we had this deal with my wife where I could work half a day until noon. So, I’d wake up at five and start coding, go to a coffee shop and code until noon, and then go back home.

Santos: This was for ten months?

Guilizzoni: This was for, yeah, about ten months.

Santos: While working full-time at Adobe?

Guilizzoni: While working full-time at Adobe. I didn’t want anybody to accuse me of slacking at work, so I did my best work at Adobe. I really put in one hundred percent there, because I loved what I was doing, first of all. It was really tough to leave. I was really happy at Adobe. It was a great job.

I highly recommend people who are just out of school to go work at Adobe or some other company that is large and knows how to develop products and sell and market them.

Most of what I learned, I learned there. It’s a wonderful environment for a programmer. You’re very sheltered. You’re able to have your failures and learn from them in a very good environment. So, I have nothing bad at all to say about my time at Adobe.

For me, I didn’t want to move to Italy and work as a remote worker. Adobe wasn’t really set up for that so well. And I had this idea and I had this passion for the wiki, etc. So, I decided to take a stab at it. It was now or never.

So, yeah, on the implementation, I wanted to make sure that I had something ready by the time I finished at Adobe. And so, June 15, 2008, was my last day at Adobe and June 19 is when I launched Mockups.

Santos: So, four days after.

Guilizzoni: Yeah, four days after. Because I’ve got a family to feed. I don’t have time. [laughs]

Santos: [laughs] And this was already in Italy, right?

Guilizzoni: This was in Italy, yeah.

Santos: Balsamiq is actually an LLC. So, it’s an American company. Or did you create an Italian company and an American one?

Guilizzoni: So, it started an LLC because I was still in the US when I started it. And when I moved to Italy, I started an SRL [Società a Responsabilità Limitata], which is the Italian equivalent. And so, we now have two companies. The SRL owns the stock of the LLC. So it’s a micro multinational, basically. I wanted to keep an American company because half of our customers are American. And they like to call an American phone number if they have a problem, and they like to mail a check, in dollars, in the mail, to an American address.

It’s just the way software business is done in the US. And so, when I opened the Italian company, I didn’t want to shut down the American company. I’m very happy that that is the case.

And this helps also with hiring. We have a place in the US for employees of the American company and Italian employees, European employees who are employed by the Italian company.

It was a lot of work to set it up, because accountants don’t really understand it when you go in and say, “I am a multinational. It is just me. I have customers in seventy-eight countries. I need your help.” And they would say, “No, you don’t exist.” So, it was a big, time commitment to set it all up and find accountants that would understand and were not too expensive. That’s done now, but it was a lot of work in the first year.

Santos: Did you find those accountants in the US or in Italy?

Guilizzoni: I went through maybe three sets of accountants in the US and in Italy we now have found somebody who has an American partner that they work with. And so, they follow Italian multinationals. We are their smaller customers. We were lucky enough to be able to grow enough to be able to afford these guys, but it’s worth the money. You should always get the most expensive accountants and lawyers you can afford, I think. It’s worth the money.

Santos: Why actually set up two companies and not, for instance, make one the branch of the other? Does it bring tax benefits?

Guilizzoni: I started with an American company because I lived in America when I started. Incorporating an LLC is a one page form and takes no time at all, so that is what I did. Then when I moved to Italy to run the company from here, I spoke with my accountants, and realized that if I wanted to live here and grow the company here, it would be beneficial if I started a company here as well. That’s where the SRL came from and that’s how I was able to hire people here. At that point, there was an option to close the LLC and just have the Italian company, but the problem is most of our customers, I think fifty percent, fifty-one maybe, of our customers are American customers and in the US people like to buy by mailing a check in the mail.

It’s kind of amazing that even the most industrialized country in the world still uses checks extensively. They like to mail a check to an American address in American dollars. Doing business in the US is much easier if you have an American company there.

What we did was to purchase the stock of the American company with the Italian company. Then the American company became a reseller, basically, in charge of the sales of the software, while the Italian company is the R&D branch. All the sales go through the American company. As far as taxes are concerned, there is no benefit by having this set up.

I think we pay maybe ten percent more, ballpark, of what we would pay if we only had one company in one country, but at least we don’t pay two hundred percent. We don’t pay both here and there on all the revenues. It’s a very common thing that companies do.

Google has a Google Ireland that is their sales branch, but it’s a separate company. It’s separate, but then not really separate. I don’t really understand.

Santos: But Google does it so the tax footprint is very low.

I think they pay … it’s something ridiculous like five percent or something like that.

Guilizzoni: Well, we don’t do that. I like paying taxes. I think that they serve an important purpose. If you want roads and hospitals, taxes are important. I don’t like to try and evade anything. I also didn’t want to have to pay twice for the same revenue. With my accountants, we were able to find this setup, which I hear is very common.

Santos: Okay. But couldn’t you just be an employee of the American company, but living abroad?

Guilizzoni: That would mean getting a visa for myself and all the other Italians. It’s not easy. It’s so much easier to have two companies in both places. For instance, in the Italian company, we have an employee who lives in France, so for this employee we have to pay taxes in France, payroll contributions in France every month, as well as in Italy. It’s just a lot of bureaucracy. We were able to hire the French employee from Italy because it’s part of the EU. There was no visa involved.

As a company of one when I started, I couldn’t afford that. Even now it seems to be a disproportionate amount of effort to try and get everybody a visa one way or the other way. Instead, with R & D separated from sales, we’re able to hire people easily.

We have payroll people and accountants and lawyers both here and there. It’s not easy to be a micro multinational I have to tell you. I had a few accountants in the US that waved a white flag on us and passed us over to people with more expertise. We don’t really fit with the current legislation. Well, we do, but it’s not very common. When I walked into the accountant’s office and I said, “It’s just me for now. I have two companies, customers in seventy-eight countries, help me out.”

They’re like, “You shouldn’t exist.” That’s one of the things I decided not to worry about when I started. I decided it would be like going to the dentist. You just have to do it. We’ll pull through. I consciously decided not to let that stop me. It took a good year and a half of talking to accountants and lawyers before I settled down finally.

Santos: I can imagine. So, going back to the launch. So, you launched in June 2008, correct?

Guilizzoni: Correct.

Santos: And what happens?

Guilizzoni: It pretty much blew up in my face right away. It was immediately successful. I’ve got to look at the numbers. It was profitable after two weeks. Basically, I got my lawyer fees and all the other money that I had put in before, which was maybe $2,000. I made it back in two weeks. And then, we made $10,000 in sales after six weeks. Something like that. I have to give you the right numbers, let me see.

They’re on the company page. I keep forgetting. But anyway, it’s been growing and growing and growing and growing without stop since the beginning.

So, I looked at the numbers for our third anniversary, which was last week or ten days ago, and we sold over $6.6 million of Mockups to over fifty thousand customers. And business is still growing. I got lucky. I don’t know what to tell you.

It found this underserved niche that is growing, as well. More people are getting into user experience and have web sites and web applications or software that they’re building.

So, somehow, I hit a sweet spot with the price and the feature list, and I guess we’re doing a good job.

Santos: But when you launched, did you do a media campaign? Did you contact TechCrunch or whoever to get a lot of media attention?

Guilizzoni: Yeah, I have a blog post about what I did. I didn’t have TechCrunch because I was bootstrapped from day one. They’re more about or at least they used to be more about venture capitalists, start-ups that are designed to grow. This was never my intention. My goal was to build a little Italian restaurant on the web. Great quality, family-run. Not really just family, but my employees feel like a family to me.

Basically, they make their customers happy, generation after generation, and they love what they do. They do something that requires craftsmanship. That’s my ideal. That’s what I look up to.

And so, it’s not really TechCrunch material, I don’t think. But I did write to a few bloggers that I admired, and I wrote to some bloggers whose audience I thought would be interested in Mockups.

Then I did Twitter searches for keywords to see if people were interested in my tool. Basically, I did what I could do, as a single guy, unknown on the internet. But luckily, we had a product that did most of the work for me. It has enough character that people immediately recognize what it is. Or if they don’t, they’re like, “Hey, how’d you build that? That looks interesting.”

I guess my best idea was to make the interfaces that you draw be hand drawn. My wife drew them on paper and then I scanned them in and made them stretchable. But the end result of the Mockups that you can build with my tool, look hand drawn, and the goal of that is to elicit honest feedback. They have to look bad. They have to look like you just threw them together so other people are not embarrassed to give you their honest opinion.

Also, you can’t put in too much detail, because otherwise the human eye gets drawn into the detail. And then they give you feedback on the color gradient instead of the structure of the web site. So yeah, it’s been word of mouth I think, due to the product. That’s it.

Santos: Okay, interesting. And you had, as you said—a huge learning explosion. What were the major fears and problems that happened along the way?

Guilizzoni: Oh, man. I mean, not a day goes by. [laughter] I had no idea what I was doing. I still don’t feel like I really know what I’m doing. It takes the ten thousand hours to become good at something, right? Everybody says that.

Santos: Yeah. True.

Guilizzoni: Maybe I’ve got three thousand so far. The biggest surprise was what an amazingly different job it is from being a programmer to become a CEO. It is so incredibly different, and how is that even something that people try to do? It’s common knowledge that it’s expected that you should be able to make the transition, because you start, the coding becomes what you do in your spare time. It becomes the easiest part of your job. The rest is legal. I have to write a license agreement. I never even read one. I accepted a million of them, but now I have to write one? [laughter]

There are a lot of moments like that where you don’t know what you’re doing, but this was the whole point. I wanted to learn how to do it. So, roll up your sleeves, do your homework, read up on things, and just do your best. And then continuously improve everything that you produce.

So, there were a lot of moments [with] the first big customers, and you’re on the phone with some CIO of some Fortune 500 company and they don’t know that it’s just you and three weeks ago you were this lowly programmer—seven steps removed from executives. [laughs] So there are a lot of moments where it’s really terrifying.

Then the first venture capitalists call, and the first acquisition offer. I mean, these are terrifying things.

Santos: You had VCs calling you, and acquisitions?

Guilizzoni: Yes.

Santos: But you are completely bootstrap, right?

Guilizzoni: We’re completely bootstrapped. We got our funding from our customers. Through my favorite way. And yeah, I do have VCs calling almost every week. Right now, I have a pretty good spiel to say “thank you, but no thank you, maybe later.” But remember, the first couple of calls were, “Oh my gosh!”

And then acquisitions offers. I can’t talk about them so much, but yeah,

we came pretty close at some points. But I’m very happy with remaining independent.

Santos: And so, you worked by yourself until when?

Guilizzoni: Until launch, that was a good ten months, right? And then until maybe three thousand customers, which was six months, maybe? In March 2008, I hired my first employee, Marco, as a programmer. Because all of my time was going to customer support and I didn’t have time to program anymore, so I couldn’t move forward. The speed of releases had slowed down to a crawl. I could only code on the weekend. After a while I woke up and I said, “If I keep doing this I’m going to be dead.” I wasn’t worried about growing bankrupt or anything. It was really about my life. [laughter]

So I hired Marco to program while I did tech support, and then I hired Valerie in the US to do support while I was sleeping. That was in April 2008. Then we’ve slowly, slowly been growing. Now there are nine of us, eight full-time employees, in three years. Which from the outside seems like it’s fast growth, but I’ve always been trying to stay as small as humanly possible. Optimize our back-end processes as much as we possibly can.

My dream was to build this little team of five, six people. And it was actually hard when we reached six people, it was hard for me to let go of the dream and understand that we couldn’t really stay at six forever, because customers just kept coming and kept coming, and so we were working ourselves to death.

That’s when I decided to hire two more people, and that was in October last year, 2010. Then one more person just joined. So now I’m no longer going to artificially cap the number of employees to fulfill my dream, which was an unsustainable dream. I’ve learned that now, but it took a while.

Santos: You’re basically, as you said, multinational. Headquartered in Italy. What’s your view, from your experience, of how different it is to run a company in Italy vs. a start-up in the US?

Guilizzoni: This is a hard question for me to answer, because I’ve never run a start-up any other way. I’ve never run a start-up in the US, and I’ve never worked in Italy. Right after graduating from college, I moved to the US to look for a job, and I was lucky enough to start working at Macromedia. So I don’t really know what it’s like to work in Italy, let alone run a company in the traditional sense in Italy. We’re a very special company in Italy, because we just happen to live here, but our business is all on the internet.

We could be anywhere and we have very little contact with Italians. We have very few Italian customers. Other than paying rent to the office, it’s not like I know much about running a company.

Or what it means to be an Italian company. In Italy, developers are not unionized. It’s one of the few professions in Italy where there’s no union. Even that is no different from the US. It’s hard for me to answer this question.

While on the internet. I’m running a company the way I figured out how to. My only other experience was with Adobe or Macromedia, which are super-large companies and they are run in a much different way because of the size.

I don’t know. Who knows? I’m sure there’s a lot of stuff that we’re not doing, that we could improve, but so far, we’re having a good time and learning as we go.

Santos: Balsamiq is known for giving away a lot of licenses to NGOs [non-governmental organizations] and others. What made you be so giving?

Guilizzoni: I don’t know. It was something that I wanted to do from the beginning. I think that one of the inspirations was … I had a lot of inspirations. In San Francisco, I was introduced to the concept of volunteering and donation by my boss, Roberto Tatsumi, who was one of the inventors of Flash. He was always organizing the food-bank trips. That was the first time that I had any money to donate, as well. I really started enjoying giving back.

I realized how privileged my life has been and how much even a little, little gesture can make quite a difference in someone else’s life. That became part of my life, to do that. When I started thinking about Balsamiq, I read this book from Guy Kawasaki. He has a little talk, where he says, “You should make meaning in the world. You shouldn’t start a company to make money. You should start it to make meaning. Which is, work on something that matters to you more than money. Change the world. Make the world a better place, as much as you can.”

Why not? If you’re not doing it for that, if you’re just doing it for the money, you’re probably going to fail and that’s not the point.

I absolutely agree. Money should be a side effect, not a motivation. So from the beginning I was thinking, “What can I do? Maybe donate ten percent of the revenue to some charity? How do I pick the charity? How does it work accounting wise?” I didn’t have any revenue at the time. So [laughs] that’s not going to do a lot of good.

Then, some customers started writing me at the beginning. Some people started e-mailing me and say, “I could really use your tool but I can’t afford it and I’m doing this and it’s something good for the world.” I was like okay. If you think it’s going to help you. It doesn’t cost me anything to create a new license for you. I was really surprised that my software, itself, could be something that was worth it for people and that could help them.

It takes me five seconds to create a new license and e-mail it to somebody, so, of course, I will give you a copy. There was some other company, Atlassian. Atlassian itself, they donated to nonprofits and to open-source projects. I thought that was really nice. I instituted a very similar policy and I put it on my web site. When you went to the buy page, it said, “Wait! Don’t buy yet. You probably can get it for free.” [laughter]

You had to read all the different ways you could get it for free and then scroll down, okay, if you don’t qualify, here, you can buy it, it’s cheap. With that, it started taking off and it’s a wonderful thing to do. We love it. We have a person whose job, half the time, is just to give licenses away. I don’t know the numbers offhand, but I think we give a good thirty, forty licenses every day. It’s such a wonderful feeling. You get the best e-mails.

It does feel like we’re giving back a little bit. I wouldn’t stop it. It is a big investment of time, but I am very happy that this is part of who we are and I know that all my employees are proud to work at a company that gives back, as well.

We also do donations that are not just software, we do company donations regularly. I guess the answer is, why not? It doesn’t cost you anything to do it and the benefits are wonderful for yourself and for the people who receive the licenses. Nonprofits should be using the little money that they have to feed people or do the things that they were born for. They shouldn’t be spending money on software, come on.

Santos: Going back to the beginning, even with this explosive growth that you saw, was there any moment that you thought, “I’m just losing control over it” or “This is going to go all downhill?” Or did everything seem always just to grow and you only have to worry about the growth?

Guilizzoni: I was definitely lucky enough to only have the problem of “crap, my customer service is going down because I can’t keep up.” From the very beginning the problem has been a very good problem, which is to try to rein in the growth until we were able to catch up. We say we like to compete in customer service and I truly believe that. Having too many customers has an effect on that. You need to hire people and train them in support and the product needs to be mature enough that not too many people write to support with bugs and stuff.

So it takes time to provide good customer service. That was the problem that I had from the beginning. There were moments that I thought this is getting out of control, like when I decided to hire the first employee, which was a major, terrifying step. Then when I had to let go of my dream of having a six-people company.

Those moments were all because it was spinning out of control. I don’t look at metrics very much except for the revenue and the profits, and there are times where there’s a week that is slower than another. So you’re always a little bit worried.

I don’t take anything for granted. I try to keep as much money in the company as possible because I am very much aware of how fickle people are on the internet. Just the fact that we exploded so quickly means that somebody else … a lot of people have been seeing the revenue that we are now making. So tomorrow it could happen to us.

Remember Myspace or Friendster? They were huge. They were the thing. The internet moves so quickly that I want to make sure that we have enough money in the bank in case revenue goes to zero tomorrow, we still have a couple years to figure out what else to do.

The good thing is that I think I wouldn’t want to have that problem with any other team. I think that our team can come up with something if they need to, that the people are so great and I love to work with them that I wouldn’t want to be in a problem situation with anyone else.

I think that’s the real asset that no one can copy.

Santos: The team?

Guilizzoni: Yeah, the team. I think, in the end, that’s the competitive advantage of any company.

Santos: The fact that you want to keep the team small is also good in terms of flexibility.

Guilizzoni: Right, exactly. We have to stay as nimble as we can possibly be and keep our ears open. That’s a big part of my job is to read Hacker News and see what’s going on and learn about new technologies and try to get a sense of where the market is going. Those are things that I’ve had to learn how to do and I am still learning. The smaller and nimbler we are, the more we can be on our feet and adapt to things that will inevitably change. No software is forever. Nothing is forever. I’m very much aware of that.

Right now we are at the peak. Well, I shouldn’t say we’re at the peak, but we’re definitely at a high. We’ll see what happens. I’m always assuming that it could go down tomorrow.

Santos: Your perspective that it could go down is just because you think that the internet and people can change very quickly, right?

Guilizzoni: Yeah, I think so. I’m always an optimist, but I’m also a realist and I guess pragmatic. I’d rather be thinking dead than thinking, “Oh, everything is good, we’re good forever, let’s all buy a Ferrari.” I guess I’m very conservative and that might be a European trait, being a little more risk averse than Americans. But I don’t know. I don’t like generalizing.

Santos: All products that Balsamiq now have are around Mockups. Do you expect to expand your product line and, if so, in what areas?

Guilizzoni: When I first started, I thought Mockups were too small of a product to be able to pay the bills. I had this plan of building a new product every three months and then spending three months to market it and sell it and then do another one. It shows you how clueless I was. It’s been over three years now. We have nine people, all focused on Mockups and all its different variations.

The product is the same, but we sell it in different ways: as a plug in or as a web app or as a desktop app. Products are a little bit like children. They take a life of their own and you have to take care of them. While I do have ideas for future products, I also know that Mockups right now requires our full attention because we would be doing a disservice if we moved on to something else right now.

I think that maybe we have about a years’ worth of development for Mockups before we can consider it mature or implemented to the initial vision. The problem is I’ve been saying that we have a year ahead of us for over a year and a half or two years. It keeps growing. The landscape changes. The technologies change. The customers help us steer the vision. Define it better.

It just takes time and people. Right now we don’t have any short-term plans or mid-term plans to expand into other products, but we do have a file, a text file, with product ideas. I call it a write only file. We open it. We don’t look at what’s there. We just type up the new idea and close it because once we start thinking of new products, then our minds start spinning and we just can’t have that right now.

We’re always thinking that one day, we’re going to have another product. Everything we do right now, with the integrations of other platforms, is part of that same strategy where all this work can be reused for our next product as well.

Santos: Those ideas are all in completely different areas?

Guilizzoni: No. They’re always related. First of all, it’s what we love. It’s what we’re passionate about. It’s about usability and helping developers and designers and business people communicate with each other. Also because it’s much easier to sell into our existing customer base than trying to market and find a completely different group of people.

Santos: Yeah. Instead of starting from a blank sheet. You’re quite open in your communication. You have a huge amount of information in your blog and in the videos that you posted. Do you do that out of, let’s say, a thought process to help the company? Or you just do it because you just do it? It’s just the way you are?

Guilizzoni: I think it’s definitely not calculated. If it was calculated I would be doing it more because it is very effective. It was a surprise. I’ve always blogged and I like blogging. It’s a little bit like having a diary. It helps me think through problems and the beauty of doing it in public is you get feedback from people who have been there already and they can help you. It becomes this sort of a community therapy session. So that’s why I was doing it.

At the beginning, I was posting my revenue numbers because I couldn’t believe how good they were. Like I can’t believe this is happening to me. That resulted in people saying, “Oh wow, this is great, you’re so open.” No, you don’t understand. This is unbelievable.

So it’s mostly for myself to think through problems and to vent sometimes. And, why not? I think that it helps to gain the trust of your customers. Remember, I was just a single person trying to do a whole software company. If I were a large company, I would have second thoughts about buying from some random guy.

So, I was trying to gain the trust of as many people as possible by being as open and honest as I could possibly be, which also helps that that’s what I want to be as a person. Why not? Why not? The other thing is it’s another way to give back. I’ve learned so much from all these Spolskys [Joel Spolsky, blogger at Joel on Software] and all the different books that I read.

If anything that I do works out for myself, of course I’m going to share it. I think knowledge is for sharing. It’s just a way to be a good citizen.

Santos: Was there any moment this openness backfired?

Guilizzoni: I don’t think so. No. No. I mean, there were some people who were saying, “Oh, this is all a fake.” People that were like, this is a PR move by Adobe to push Adobe AIR. I was like “Come on, really?” In one sense, what happened was that as people saw our revenue numbers and they were so good all these clones started popping up everywhere. Maybe they would have popped up anyway, but it seems like people saw our numbers and decided “Hey, maybe I can do that too since he’s just one guy, I’m just one guy. Why not?”

We have maybe, I don’t know, ten, fifteen clones or knockoffs, but it’s great for business for us. It pushes us up the ladder as the leader.

Sometimes I wonder if those guys would have done it anyway had they not read my blog. The more the merrier. My view on competition comes from Tim O’Reilly, who says “Look at your competitors as people who are also trying to solve the same problem that you are solving.”

If you look at it that way, we’re all rowing in the same direction. They’re also helping people build more useable software and that’s what I want. That’s what I want to do in the world is to get rid of bad software. That’s why I’m doing this. That’s what matters to me more than money.

So if they’re doing it with my tool, great. If they’re doing it with another tool, also great. That really helps me think about competition. I like to think of competition in that way.

Santos: Where do you think the company will be in ten years?

Guilizzoni: This question makes me laugh a little bit because ten years seems like an infinite amount of time. Marco, my first employee who knows me quite well by now, made me realize that when I say something is forever, it really means the next three months. [laughter]

My job in our company has grown so fast and everything changes so fast that it’s true that I can’t really plan after three months. I’ve changed jobs dramatically myself, as I went from a one man company to now having nine people. Every three months it seems like it’s all different. Kind of like having a baby, where you think you have the hang of it and then they grow and they change completely. Then you have to start over.

That said, I do know what I hope for the company, which is to still be around, first of all, as an independent, good, good software vendor that does products that people love in a way that is sustainable and employs a group of people that love working with each other and love doing great work.

I always joke that I want to build a little Italian restaurant on the web, something that lasts for generations and makes their customers happy and goes at a good pace, but without too much stress. I don’t want to grow too much.

Santos: Okay. Makes sense. At that point, or even later, might you consider selling the company?

Guilizzoni: I don’t know. Not any time soon. That’s never been the plan. I really dislike people who have exit strategies. I think that means you’re not committed to your idea or you’re not doing what you love, so you shouldn’t even start. But I also know that nothing is forever. I spent twelve years of my life doing a web site for the Ultimate Frisbee community, which was huge. It was maybe the biggest web site for Ultimate for many years, and I thought that was going to be something that I did forever.

But then, after twelve years of doing that, I got bored with it. I had a kid. My values changed a little bit. Then I did end up shutting it down. I know that even the biggest successes don’t last very long. I know that software in general has a very short life span. There are only a few pieces of software that are twenty years old like Photoshop or Word.

It remains to be seen how long a piece of software can live. I hope it will live as long as it possibly can, but in my expectations I try to be realistic.

Santos: Would you like to add anything?

Guilizzoni: The other thing that I struggle with is what I should tell Italian students, because sometimes I go speak at universities. Should I tell them well you have to go to the US and work at Adobe for seven years and then can come back? I wish I didn’t have to say that. I know that that’s what worked for me, but it’s something that is hard to receive because you may not be able to afford it, or who knows.

And it’s a big move. Moving from Italy to California is a big move. In a sense I wish that I could say just take these classes, go work at this local company, and you’ll learn what you need. I don’t know enough about the European technology scene yet. That’s something that I struggle with.

My answer is a little bit of a cheat. Go learn in the US and bring it back. Not ideal.

Santos: Actually that question is the reason why I decided to make the book. It appears that no one has the answer. No one knows and everyone has different experiences. Just like you when you went to Adobe in the US, I went to London and I went to the Netherlands, and it completely shifted my mind.

Guilizzoni: There you go.

Santos: So, I think it’s just get out of your environment and try something new and see what happens. I think it’s an interesting question. Maybe I phrased the question wrong because the point of it is how different is it to be in the US because everyone has that idea of Silicon Valley and so on. Everything happens there. Then in Italy, Portugal, Spain, France, whatever, it’s viewed as an old business thing and it doesn’t have the same, let’s say “sugar” around it.

Guilizzoni: Well, that I think is not true. You can be on the internet from wherever. In fact, I like not being in Silicon Valley. Every time I go back there I feel so stressed out. Everybody’s always running and running and running, and the next opportunity is always around the corner. It gave me an ulcer last time I went. I was like, “Oh, wow. I’m so glad I don’t live here.” I live in a place where people do understand the value of family/work balance. There are differences in the culture that somehow are reflected if you live in a place, even if you work on the internet.

I’m very happy to be in Italy, but also I’m very happy to have the global team because that way we get all kinds of perspectives.