The concept of shareware appeared in the 1980s. Developers would use relatively primitive tools to create their software, then promote it via fanzines, user groups and bulletin boards to a niche audience of shareware fans. If you wanted to try the software, you would have to get hold of a floppy disk with it on. And, if you wanted to buy a licence, you would generally have to post a physical cheque to the developer. This was being an Indie developer in hard mode. A few people made a lot of money, but most vendors made modest returns on their efforts.
I started selling my first software product in 2005. This was a good time to start up as an independent software vendor. High quality compilers, IDEs, debuggers, version control systems and web servers were widely available and mostly free. The market for software was growing, as more and more people purchased PCs and Macs. Payment processors were starting to streamline online payments. But the real revolution was being able to distribute your software worldwide via an increasingly ubiquitous Internet. And getting noticed by potential customers, while never easy, was generally achievable through writing content for search engines to find, paid online ads (such as Google Adwords pay per click), download sites or even ads in physical magazines. With a lot of hard work and a bit of luck, it was quite possible to make a decent living.
Things have continued evolving at a rapid pace over the 20 years I have been selling software. Development tools have continued to improve. Mobile and web-based software has become mainstream. App stores have appeared. Outsourcing became a thing. Subscription payment models are increasingly common. Mostly these changes haven’t affected my business too much. But recently things have begun to feel noticeably harder.
LLMs have made a major impact. While I don’t worry that LLMs will do a better job than my seating planner software, data wrangling software or visual planning software any time soon (my main competitor remains Excel), everyone is noticing that their web traffic is falling. People increasingly read LLM summaries rather than clicking on search engine links or the accompanying ads. Maybe the LLM will include a link to the website that they ripped off the content from, but probably they won’t. So writing content in the hope of traffic from search engines is becoming less and less of a viable strategy to get noticed.
Other promotional channels are getting squeezed as well. Online ads are increasingly expensive and rife with click fraud. This makes it hard to get any chance of a return, unless lifetime customer value is hundreds of dollars. Google Adwords is a case in point. In the early days, I could get lots of targeted clicks at an affordable price. But Google have done everything they can to raise bid prices and generally enshittify Adwords, so they can grab more and more of the value in every transaction. I now get barely any clicks at bid prices I am prepared to pay.
One of the few useful promotional channels left is YouTube. But it is very time-consuming to produce videos and the amount of competition is huge. I fully expect generative AI to erode its value over time, as AI slop floods the channel.
Typically promotional channels start off great for vendors and become less great over time (the law of shitty clickthrus). But then new promotional channels appear and the dance starts again. But there just doesn’t seem to be much in the way of viable new channels appearing for Indie vendors like myself. My experiment with advertising on Reddit did not go well.
LLMs potentially also make software easier to write, which is a double-edged sword. It might help you code features faster, but it also lowers the barrier, so that more people can compete. Even if your new competition is bug riddled garbage, ‘vibe coded’ by someone who doesn’t know what they are doing, it still makes it harder for your product to get noticed.
The general cost of living crisis hasn’t helped either. The super-rich are making out like bandits, but everyone else has less disposable income. And that is only going to get worse when the current AI funding circle-jerk implodes.
Each of the different software platforms also have their own issues.
- Downloadable software has fallen out of fashion and the market is shrinking as increasingly people expect software to be web-based. People are also wary about downloading software onto their computers, in case it contains malware.
- Web-based software is more of a service than a product and is expected to be available 24×7. Expect to get lots of very unhappy emails if your server falls over. And woe betide you if your customer data is hacked. Disappearing off somewhere for a few days without an Internet connection is not really viable, unless you have employees.
- Mobile-based software is expected to be free or, at best, very cheap. So requires huge scale to make any decent return. And that is tough when there are some 2 million apps in the iPhone app store. You are also at the mercy of app store owners, who really don’t have your best interest at heart.
The new wave of AI tools must be creating new opportunities, but it seems these opportunities are mostly there for big companies, not for Indie developers. And it is very risky to build your product as a thin layer on top of someone else’s platform. Ask people who built tools and services on top of Twitter.
It feels that it is getting harder for small software vendors, like myself, to make a living. Of course, this could be just the ramblings of a 50-something-year-old, looking back through his rose-tinted varifocals. What do you think? Has it got harder?
If you want to show indie software vendors some love, check out all the great indie software for Mac and Windows (including my own Easy Data Transform and Hyper Plan) on sale at Winterfest.
Successful Software 