Zak, CEO of Upverter, took an hour out of his busy investment tour to chat with me.

Back in France, I co-founded a video game company that grew up to fifty people. I also co-founded a ambitious processor project in Silicon Valley that did not go anywhere. Today, after a short stunt as a computer security expert, I am back in a coffee shop / office, working on fortylines. The difference; this time I am solely and fully responsible for driving sales and revenue generation.

In this new role I was really eager to talk with Zak, CEO of Upverter. Not only has Upverter a great product, they also "get the cloud", and what it can bring to the EDA industry. Here are the notes from my chat with Zak Homuth. These are most likely the best advises I received in a long time.

What about a community forum to drive product features?

Fortylines had the great idea to shutdown its internal feature tracking system and manage that information in the form of a public Q&A website. We hope it will help us engage users about what is important to them, etc.

Zak's reality check: Upverter set up a public forum for feedback early on. As it turns out, it wasn't that effective at turning up important features. The answers usually fell in two categories: Things we already knew Upverter needed to do and things that were just out there far in the future. In the end it takes a lot of filter, gut feel, and experience to turn suggestions into workable meaningful improvements. Upverter has had a lot more success with analytics. Users often tell half-truth about what they do and care about. Their interaction with your website, what they click on and the features they use, do not lie.

What is your experience with pre-payments?

Fortylines is building on a pre-charge business model. A little bit like pre-paid phone card, you buy some credit upfront, spend it, refill, spend more, etc. Technically, it is straightforward to implement and you can be up in a couple of hours using the stripe API. It is supposed to be low friction since you don't have a recurring monthly subscription.

Zak's reality check: Upverter did try the pre-pay approach. It is really hard to convince someone to pay for a new kind of service from an unknown company. Upverter has seen good results when it moved to a model where using the service for a limited time is free, then all hours above the quota is charged monthly.

How do you transition from the hobbyist to the professional market?

Fortylines is building a service around big data and compute intensive processes. We plan to first go after the hobbyists because they often have smaller projects. As we gain knowledge and become confident we can scale to the workload sizes we want to ultimately handle, we will target small enterprises, then medium companies, and later the Intel's of the world.

Zak's reality check: After being very much hobbyists oriented, Upverter is seeing adoption amongst professionals but the chasm to cross is quite wide. It is a lot harder to move from the hobbyist market to the professional market than you can imagine.

Should I look for venture capital now?

The product is not yet functional, yet a few people have signed up and some people are really exited by what we are providing. What do we do?

Zak's reality check: Before anything else, you need to figure out which kind of business you want to be. That means doing some serious soul searching. For example: Are you comfortable with the idea of building a company that makes above $100M of revenue with over 1,000 employees? Is it your ultimate goal? Would you have more pride in a business that made it through organic growth?

The cash flow side of the equation is also one, if not the only, key factor for a start-up. At the minimum, you should write down a two-columns timeline on paper: in the first column, put down the concrete events that must happen, by when, for you to continue; in the second column, be clear on the flip-side signs for you to call it quit. Then share your timelines with all of your co-founders.

When do you know you are ready for launch?

Fortylines has a list of features we are working on. Yet, as time passes, we are finding ourselves switching them from the "required" to the "nice to have" column.

Zak's reality check: In all simplicity, you are ready to launch when your product makes one person's life better and she is paying you for it. In reality, all plans do not resist first encounter. It is a lot cheaper to find out what went wrong and correct course early. Yes, there will be stressful on-the-fly bug fixes in the production server. It is OK. If your product solves a particularly painful problem for them, your users won't mind a few quirks here and there. Keep working at it and improve regularly.