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YNAB moving to a subscription model
superboyac:
One thing I don't quite understand though is that if YNAB4 is working fine and might work fine for years to come, why are so many die-hard YNAB4 fans (like Macdrifter I linked to or the above open source developers) looking for alternatives already?
-dr_andus (January 07, 2016, 05:15 PM)
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It's called "getting ahead of the problem," I think. The "problem" being YNAB has overstepped what many of their existing customers think is acceptable behavior on their part. These people are now looking for alternatives outside of what YNAB is plannoing to do. Most of them also assume (and I'm inclined to agree with them) that YNAB has got something in the works (probably a sellout to some other entity) that they're not talking about. And whatever it is, their present user base suspects it probably isn't going to be too happy seeing it come to pass when it does.
From a technical standpoint, YNAB runs on Air. AndAir is a dead-end technology that's just waiting to tombstone. The minute a major update to Air breaks YNAB, your options will be to "upgrade" to whatever web-based product YNAB is currently planning to offer - or to find another desktop alternative. As of right now, there's nothing (AFAIK) that does exactly what YNAB software does in quite the way it does it. It is a pretty sweet app in it's present form. Sorta like so many other apps that started of clean and focused and then got wrecked thanks to feature bloat, being repositioned as an online service, or both.
-40hz (January 07, 2016, 08:06 PM)
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Is there anything preventing (in a serious sense, like legally or something) companies like YNAB from going the subscription route, and at the same time just keep their latest "classic" version updated to work on modern devices, etc.? like MS did with windows xp until recently? Of course, the only thing I can think of is that by not supporting the old one, the users will have more motivation to use the new model. but if they just don't use it and they simply lose users, old or new, what's the point?
the weird situtaion would be like...
the new product has, say, 100,000 users a year after launch
the old product has 500,000 users a year after launch, and it didn't decrease by 100,000 or even close.
then what?
40hz:
^Hey SB!
Nothing serious to hold them back other than whatever deal they have with their stakeholders or potential buyer.
Keeping a classic destop version while trying to sell a online service version isn't too practical however. The desktop version really needs a full rewrite to get away from its Adobe Air dependency. So that's time and money and hoping peoplle will buy the rewrite now rather than wait till they have to. Which is exactly what their problem is right now.
It also works at cross purposes to them trying to sell people on a transition to the online version.
So eiher way, I think them doing an updated desktop version along with an online subscription version isn't likely to be in the cards for them. I think going online looks to them to be their easiest way out of their current dilemma from a technical and practical viewpoint. From a business and marketing viewpoint, it's an entirely different matter however.
Selling their existing users on it is a whole 'nother story. Especially considering the rather surprising amount of bad feelings and pushback they're getting so quickly following their announcement.
I wish them luck. But as things stand I suspect they've jumped the shark with this one.
Is it just me, or is that really Another One Bites the Dust playing faintly in the background right now?
dr_andus:
This is a bit off-topic, but related: taking the maxim "time is money," has anyone tried to apply the YNAB philosophy to time management itself? Could this be replicated by let's say using two Google Calendars, one for the "budget" and the other for "actual"?
wraith808:
Nothing serious to hold them back other than whatever deal they have with their stakeholders or potential buyer.
-40hz (January 08, 2016, 05:09 AM)
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That's the part that scares me about this move. It seems more a positioning move after you find out there's not a pot of gold at the end of the rainbow. And that scares me.
This is a bit off-topic, but related: taking the maxim "time is money," has anyone tried to apply the YNAB philosophy to time management itself? Could this be replicated by let's say using two Google Calendars, one for the "budget" and the other for "actual"?
-dr_andus (January 08, 2016, 11:48 AM)
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That's actually a good idea for an experiment. And then the experiment could be taken to the software world if it works. I think the largest part of the problem with trying that is going to be granularity. Every dollar has a name is one of the tenets of the financial strategy. What's the equivalent of a dollar? Maybe that's good for a different thread?
40hz:
This is a bit off-topic, but related: taking the maxim "time is money," has anyone tried to apply the YNAB philosophy to time management itself? Could this be replicated by let's say using two Google Calendars, one for the "budget" and the other for "actual"?
-dr_andus (January 08, 2016, 11:48 AM)
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I agree with Wraith that not only could it work, but may be interesting to try.
FWIW, I always planned for billable time in my companies. And I actually created an inventory item called "tech hours" for each of my techs and contractors.
That time "inventory" got budgeted and monitored just like any other expense/sale item for planning and control purposes. And it was easy to do. You had an employee/vendor hour at a fixed cost of $X with a related sell price of $Y. And an average available pool of 2000 potential billable hours, since 50 weeks times 40 hours is 2K hours for an employee. Unbilled (or unliquidated if you prefer) hours are the equivalent of "spoilage" since once the week goes by, those hours are lost forever. Just like a barrel of apples or anything else with an expiration date. Any hours used purely for company purposes get "billed" to the company.
By looking at hours as a "product" with an opportunity sales value and a fixed cost, you can get an immediate feel for how effectively you're utilizing your marketable time resources. And even more important, you're able to track and analyze using some solid numbers for management purposes.
You could also do the same with your personal time. Just think of it as an inventory item, with an expiration date, associated cost, and sell price and you're on your way.
One other thing to keep in mind. Accounting is not just about actual dollars. It's about discovering patterns and trends. The dollars on the books don't always represent actual money. They're just markers used for convenience. And since "everything has it's price," money becomes a common unit of measure that actually works quite well for management purposes. But you could assign "happiness" or "fulfillment" points - or whatever else makes sense for you - to do the tracking. All that's important is that you understand your unit(s) of measure and consistently apply them. AFter that, budgeting and determining whether you're "gaining" or "losing" becomes relatively easy to do.
Here's a grossly oversimplified simplified way of looking at how you might do it with a computer tech. (In a real business case, these projections would involve the use of historic data, industry trends, business seasonality variables, statistical analysis, and some modeling.)
Assumptions:
Available billable hours = 2000 per 12 month period.
Estimated billable hours best case: 1600 hrs.
Estimate billable hours worst case: 600 hrs.
Expected billable hours average case: 1200 hrs.
Projected billable hours based on above: 1166 hrs per 12 month period
Costs:
Salary $75,000
Benefits: $6000
Total annual cost of labor: $81,000 (essentially fixed for most purposes)
Total cost per hour for 2000 hr. year: $40.50 (81,000/2000)
Average billable hour rate: $90 (I'll skip how that number might be determined.)
Breakeven hours on annual basis: 900 billable hrs. (81000/90 = 900)
Projected profit: (projected billable hours x average billable hourly rate - cost of annual salary and benefits)
Best case: $63,000
Worst case: <$27,000> (loss!)
Expected: $$27,000
You'd need to do this for each employee or vendor. If people are paid hourly, it gets a little more complicated and involves a little more educated guesswork. But it's still very doable.
With all this worked out, yo can project a fairly decent estimate of your expected profitability from time. But you'll need to offset that by operating and fixed expenses. So this is just the tip of the iceberg. But it's a good place to start. Because doing this exercise helps you decide if it's even worth getting into a specific service type business. Maybe you can sell all your hours. But the projected profitability may not cover expenses. Or be worth it to you even if it does. Many times you'll realize that there's a lot of people who opened a small business - but aren't operating a business in the truest sense - they merely "bought themselves their job." Because most barely pay the owner and cover expenses. Which is why they fail so often the minute there's a downturn in the economy or they hit a snag. There's no buffer to cover contingencies or tide them over a lean season.
So it goes.
Ok. End of lecture.
Now here's an extra credit exercise: How could the above concepts be applied to personal time management when not thinking solely in terms of financial opportunity and cost? Why would it be worth it for you to start thinking of it that way? How would you do it if you decided to? 8)
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