Startup Side Projects, Are You Planning One Too?

Recently, Secret launched Ping, a semi-mysterious app that lives on your lock screen. Immediately, my interest piqued and so did my skepticism. Why were they building a new app? Was Secret not working out?

I wasn’t the only one with questions. On Product Hunt, Danny Espinoza asked:

@davidbyttow so should we read anything into how things are going with Secret with this release or is this just a N-O-R-T-H-like experiment?

I quickly learned that Ping was just a side project, as described in their launch announcement on Medium:

Ping was born out of a weekend hackathon where the goal was an exercise in simplicity. We were fascinated by the idea of an app that could tell you what you need to know, right when you need to know it. Why scavenge for content — it should come to you.

Of course Secret isn’t the first or only experimental startups hacking on side projects:

• With by Path – With, a simple app for sharing who you’re hanging out with, was born out of a hackathon.
• Tripcast and Daily Kiddo by Cluster – Brenden Mulligan and team recently introduced Tripcast and Daily Kiddo, both photo-based spin-offs of Cluster, targeted for specific use cases.
• MyAnalytics by KISSmetrics – The B2B-focused analytics startup built MyAnalytics, a lightweight mobile app that provides a quick glance at one’s site metrics.
• Hyperlapse by Instagram – Hyperlapse launched last month, inspired by a pitch-a-thon as Mike Krieger shared on launch day.
• Potluck, Friendlibs, and PhoneTag by Branch – Branch launched a conversation platform with nominal traction but not enough to skyrocket their business. Afterward, the team experimented with several ideas, creating Potluck, Friendlibs, and PhoneTag before being acquired by Facebook.
• Twitter by Odeo – Twitter is one of the more prominent examples, incubated within the podcast startup, Odeo.

And many others.

An Increasing Trend

Although I don’t have any hard data on this, it appears that more startups are working on side projects, as:

1. It becomes easier to build – The barrier to entry is much lower than ever before.
2. Apps become simplified – Dave Morin notes, “apps are the new features,” as startups simplify apps into specific use cases and build app constellations. This further reduces scope of each project and arguably makes it easier to market.
3. New distribution channels rise – Social platforms like Twitter, Facebook, reddit, Hacker News, Medium, and Product Hunt have also reduced the amount of effort and capital required to get attention for those that build something people want.

Side Project Pros

Of course, these side projects may not turn into multi-million dollar businesses and that’s OK. Startups hacking on the side, can benefit through:

• Serendipity – You don’t know what you might discover when building something new.
• Learning – Side projects give makers a blank slate to try out new technology, experiment with new design patterns, and market to a different audience without disrupting their existing product. Sometimes these learnings are transferred into their main product.
• Excitement – Almost every entrepreneur I know loves to brainstorm new ideas, often reminiscing the early days when they were still figuring out what to build. Side projects can ignite this entrepreneurial spirit and get a team excited.
• Marketing – Product launches are press opportunities and in some cases side projects become lead-gen for the main product (e.g. MyAnalytics by KISSmetrics).

Side Project Cons

But side projects can also introduce problems:

• Focus – If time is a startup’s most valuable asset, then side projects can be a major distraction, especially if they take off.
• Expectations – People generally invest in startups based on the team, market, and idea. Founders should do what they think is best for their company, but they also have a responsibility to use their investors’ money wisely. If a startup drastically changes directions, investors may feel misled and in some cases, those people may not be the right strategic partners for the new initiative.
• Signaling – One might question founders’ motivation for building side projects. From an outsiders perspective — especially reporters and investors — side projects may appear like a pivot or a sign that the current product isn’t working.

What do you think? Should startups work on side projects or is this misuse of resources and capital?