Small business startup kit for 2007 – mostly free!

A friend of mine called me the other day to ask for advice on what services (email, voice, apps) he should use to run his business with the caveat being that he wanted to spend as little upfront capital as possible and also have minimal ongoing maintenance headaches.  As I started thinking about his question, I remember what it was like setting up our office in 1998 and the headaches and cost of buying a Nortel phone system and phones and hiring a Microsoft networking expert to get our office set up for file sharing, back up, and email.  What a nightmare!  What was even worse was that we had to have this guy come in at least once a month for general maintenance.  So when we moved in the beginning of 2004, I vowed to outsource as much as possible.  In the end, here is what we did:

1. Exchange server – – pay monthly based on number of mailboxes and mailbox size and eliminates the headache of ongoing maintenance and backup.  also can add mobile devices like Blackberry, Good-enabled, etc. and easily provision without cap x.
2. Voice-outsourced VOIP, we have a direct pipe to a local provider, we leased some Cisco phones, and once again no upfront cap x and lots of great functionality, we pay a base monthly fee for unlimited calling.
3. Security – we bought some Cisco gear but have a small IT firm as our managed service provider remotely monitoring and updating the software with the latest patches and release.
4. Connectivity = We are networked internally on Windows and have a shared drive where we can access files.  In addition, we have a VPN for remote access to this share drive.
5. Productivity – Microsoft Office

Going back to my friend’s question, if I could set up my office now, here is what I would do:

1. Exchange server – I hate exchange and I would bail on this as soon as I can.  Instead, I would get all of my email and calendaring functionality through Google Apps for your domain – it is free and provides 2 gb of email, integrated calendaring with your email, chat and simple voice chat, and an ability to create simple web pages.  Yes this is basic but it is easy.  In addition, I expect a lot more to be offered once Jotspot is integrated along with some of the other basic Google Office apps such as word processing and spreadsheet functionality.  My one big beef which is holding me back right now is the lack of simple syncing with wireless devices.  There are some apps you can plug in to sync Google calendar but they still need some work.
2. Voice – if I want something more robust I would get a Fonality PBXtra for $995.  If you choose to go the really simple route, the PC-only VOIP providers of today have come a long way since 2004. I am partial to Gizmo Project (wait for our new version which will be accessible through a browser – also, full disclosure, I am on the board) but Skype and other services can once again offer you pretty decent voice communications and functionality like the ability to buy your own phone number, call forwarding, and dual ringing on your computer or cell phone.
3. Security – not as important if your files are hosted offline and backed up remotely (try xdrive which is free for 5 gb or (free for 1gb). 
4. Connectivity – a simple wifi network in the office can get you simple file sharing without an IT professional’s help.  If you want to collaborate with remote workers, you can use a wiki like Jotspot  or Socialtext or some of the shared storage services I mention above.  As far as remote acccess, no VPN is needed as a simple GoToMyPc account ($19.95 per pc per month) or LogMeIn (free for base functionality) can get you the access that you need without the headaches and upfront cost of a VPN.
5. Productivity-Microsoft Office but the online apps are getting better and in fact for collaboration or sharing would consider Google Office apps like spreadsheets and writely

What is amazing to me is how far and how fast we have come during the last 2 years.  The big difference is that the functionality is even better and so is the price – mostly free!  Given this, I wonder what we will be looking at 2 years from now?  Yes, one problem is that all of the solutions I list above are dependent on having an Internet connection.  What if I am not online and need access to my calendar or some office documents?  Since this is a pretty clear problem, my prediction for 2007 is that online apps get better offline client like functionality.  Maybe it will be the new Adobe Apollo platform that makes it happen for us?  What is clear is that one of the benefits of SAAS for developers is that they don’t have to code in multiple platforms.  Once you start diving into the murky world of multiple operating systems and developing clients for Windows, Mac, and Linux, it can quickly become quite messy and resource intensive.  That is why I also see 2007 as the year that offline apps become big as the Apollo platform is released and allows web developers to build an application on one platform that can be deployed cross operating system.  Also keep an eye out for Microsoft’s WPF/e (windows presentation framework everywhere see an earlier post for more info on wpf).  This is a big deal and will help SAAS-based apps continue its upward trajectory and spread from consumers to SMBs and even further into enterprises.  As an example, take a look at Jeff Nolan’s recent post about how frustrated he is with Exchange and how GMail provides a nice alternative.  With the ability to get my whole office set up with a few clicks, it is no wonder that Microsoft is running scared and embracing SAAS rather than fighting it.

Published by Ed Sim

founder boldstart ventures, over 20 years experience seeding and leading first rounds in enterprise startups, @boldstartvc, googlization of IT, SaaS 3.0, security, smart data; cherish family time + enjoy lacrosse + hockey

11 comments on “Small business startup kit for 2007 – mostly free!”

  1. You might also want to look at Joyent’s offerings: Strongspace and Bingo Disk for file storage, and their Connector project for email, file sharing, and calendaring.

    I have put a couple of clients on Google Apps for Your Domain, but there are some downsides. No IMAP access to your mail and limited Blackberry BIS integration are two big ones.

    The web-page authoring app is pretty useless. Also, it’s surprising there isn’t better default integration for members of your domain (for example a group calendar, chat preconfigured for members of your domain, and so on).

    Another important point is that once GAFYD goes out of beta, any new users are not guaranteed to be free (although existing users will not be charged). No pricing information has been released yet.

  2. I agree on the downsides on Google apps, particularly gmail. will take a look at Joyent, it seems pretty powerful and flexible

  3. Ed, good post. I have opened up numerous offices over the years and all have been headaches except over the last 2 or 3 years because of some solid technologies out there.

    Here is another solid service that we have used which saves considerable amounts of money and headaches. Have a look at RingCentral at They provide Virtual PBX services, everything from professional voice mail extension, routing of calls, toll free, local numbers, dial by name directory, etc. All offered as software as a service. Although not free, their prices start at $10/month. Works especially well for remote offices and workers. Also used for conference calls on the cheap.

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  5. Ed you are breaking my heart. I usually aggree with you but point 3 about security. You are insane. If your content is on a 3rd party service you are just asking to have bad things happen, especially if it is on a Free 3rd party service. Did you read the TOS for Xdrive? How do you think they find out if you have copy righted materials stored on their server? They look through your stuff when ever they feel like it, and you have no way of knowing.

    Your IT Guy should not have the keys to everything on the network, even if he is admin. And you shouldn’t trust someone who doesn’t work for you any farther than you can throw them.

    As to Exchange vs. Google… If you use Windows Mobile you will love exchange, if you use Palm you will love google. So it has more to do with which smart phone you like. Black Berry is better with Exchange as well. I also like the Exchange integration with Customer Relationship Manager, which Google doesn’t have.

  6. Um, my Windows Mobile works just fine with Google, using as the sync service. I’m slowly removing all use of M$oft software (not as easy as I’d like, with 15 years of indoctrination).

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