The SpeedTools Function library – Licensing, Pricing, Piracy and Ecommerce

We had a great time spending August in Norfolk (a 30-year tradition) with lots of sailing and walking.

When I got back in September I started wrestling with how to license, price, sell and fulfill the sale of the SpeedTools Function library.
(This is displacement activity from tackling coding the FILTER functions …)

Fight Scope Creep by Splitting!

The first decision was that scope creep (rapidly heading towards 100 additional Excel functions!) had got to the point where I needed to split SpeedTools into a number of products:

  • SpeedTools Calc – The extended calculation methods and options
  • SpeedTools Lookups – The fast Lookup and Comparison functions
  • SpeedTools Filters – The Filtering, Sorting and Distinct/Unique functions
  • SpeedTools Extra – the Math, Logical, Array, Text and Information functions
  • SpeedTools Premium – a bundle containing all the other 4 products

SpeedTools Calc contains all the User Interface stuff and is mostly a VBA addin, and the other 3 products are mostly contained in an XLL.

Choosing an E-Commerce provider

When I started selling FastExcel in 2001 we custom built the website and licensing system that took the orders, priced them, maintained the License database and linked to Worldpay for the credit card processing in multiple currencies, then automatically emailed out the License codes etc. The system has worked pretty well for 11 years but has some serious limitations and would need rewriting to handle multiple products.

So I started looking at the many available E-Commerce providers who handle software sales. I found a useful starting point here.
More research gave me a shortlist of Avangate and FastSpring who both seemed to tick most of my boxes:

  • Reasonable costs
  • Multiple currencies
  • Integration with licensing software
  • Multiple products
  • Volume Licensing
  • Credit Cards (including AMEX), PayPal, Purchase Orders, Money Transfer supported
  • Coupons, promotions, time-limited pricing

Licensing and Piracy

As we all know, its pretty easy to hack a VBA addin, and difficult to prevent casual copying of your XLA/XLAM product. For FastExcel I used an installer that required required an installation password, but I wanted a better defence against casual copying for SpeedTools. I decided to use a License activation system, and so looked at the systems that were already integrated (see FastSpring DRM) with my chosen E-Commerce provider FastSpring.

The system I chose can be integrated with Excel VBA and VB6 addins as well as .NET and C++ stuff. You can embed a time-limited trial license inside your code and then upgrade with one or more licenses. It uses Public/Private key encryption and you can choose what kind of machine binding you want to use.

To make this work you also need a web server for the license database that can dynamically link both to your E-Commerce provider and to your application. I did not want the cost and hassle of hosting and maintaining my own license server and so opted for a system that provides a hosted web license server for you.

If no valid license to any of the products is found then the products do not load. If there is at least one licensed product then the User Interface and Help for all the products is shown, but using for example a MEMLOOKUP function without a Lookups license will make the function return a message saying “No valid license found for this function” to the calling cells.

Is this hacker-proof? Probably not – nothing really is, but I think its more than enough to stop casual copying.

Implementing all this is quite complex because you have to integrate a number of things:

  • Your own Website to sell and link to the Ecommerce provider
  • setting up the E-commerce provider and linking it to the License activation server
  • creating an install package that delivers and installs all the requisite software and files and products
  • integrating the licensing software into your products, including the UI for managing the licenses.


Deciding on the right price for your software product is impossible.

I started by looking at what prices other people charge for Excel addins, then considered how useful each product would be to someone who needed the function provided, and how much time and effort had been used to create them. For most of these products I could not find any real competitive products.

This gave me a range of base prices for the different products (currently $29 (Calc) to $69 (Lookups), but this might change!).

The next step was to consider volume discounts. There are 2 main scenarios to consider here for a function library:

  • An individual who wants a license that covers work and home (so 2 PCs)
  • Workbooks that will get used by a number of different people on different Machines.

My current thinking is to start with a very steep discount for 2 licenses (so that buying 2 costs only 30% more than buying 1) and then increase the discount progressively for larger volumes.


It has taken me about 2 weeks work so far, and there is probably another week needed to finish, but thats not too bad considering the complexity of the task and that (hopefully) the system will be in use for the next ten years or so.

So what level do you think I should price at?

And how do you feel about license activation?


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9 Responses to The SpeedTools Function library – Licensing, Pricing, Piracy and Ecommerce

  1. Jon says:

    This is perfect timing for me. In a couple of weeks I’ll finish my first product for actual sale (my first product – the time card – I’m just giving away). So thanks for posting this information! I’ll have to bookmark it.

    I’ve seen prices from $20 up to $50 in my very limited look online (see I think if you are targeting businesses what you have targeted is probably fair. For consumers I’m sure it is on the high end and probably wouldn’t be something someone would want, unless they got their business to pay for the first copy and then bought the second for home use. I’ve seen different pricing for home vs for businesses, of course, there is no way to tell if someone is being honest about if it were home or business.

    I don’t believe that copyrights/patents are truly property but I do think people ought to compensate a creator of property if they would like to be compensated. So I license mine under creative commons attribute and share-alike. But I don’t think that should stop people from going the route of doing a registration key for their software. From reading I know some companies don’t bother with registration keys since they can be more hassle than what they’re worth. Also, some people have noticed increased sales by giving their books away on torrents than they would have gotten otherwise when they only sell their product the conventional way. So, through torrents they get “advertisement.” But for very niche products like ours I wonder what the value of this sort of “advertisement” would be.

    So, maybe experimenting with the different methods of sale and licensing would work for you. Maybe putting some of your product on torrents and then keeping some of the software locked down and see how the sales go for both? If you do that I would be interested in your results!

  2. fastexcel says:

    @Jon, I don’t think these are consumer or casual excel user products: they are targeted at people with large slow spreadsheets, which will be 99% in business (altho some of them will be 1-person businesses). Looking at commercially available addins many of them seem to sell what I would regard as trivial function for $20-$50 with bundles of trivial stuff going for $150-$250, so its tempting to conclude that I should price higher!

    • Jon says:

      Another topic I would be interested in, if your up for sharing your thoughts, is how to market you add-ins. I am currently reading “Start Small, Stay Small: A Developer’s Guide to Launching a Startup.” It seems fairly complex. As a programmer it would be nice to just program, but as an entrepreneur that is not an option.

    • Jon says:

      These guys charge $100 for their basic product and $300 for their pro version + basic product. So, yes, you might be way under charging:

      I know they target different things, but if it works really well, companies will pay for higher quality.

  3. jeff Weir says:

    I read a damn good book on pricing a few years back: The Strategy and Tactics of Pricing (2nd Edition), Nagle & Holden, 2002

    You’ll probably find a copy at your local library.

    Some issues the above-mentioned book raised in terms of value-based pricing included:
    * How do we communicate value, thus justifying the price?
    * How can we better segment the market to justify pricing differently when the value is different? (Buyer, Location, Time, Quantity, Design, Bundling)

    The book was also big on the fact that your strategy should determine your pricing. To that end, Identification of the most profitable segments should be done before developing a product/service offering, before developing a marketing plan and a distribution strategy, and before developing a price structure . This will then give some indication of how to price to those segments.

    In terms of economic value to the customer, this is largely framed by what the alternatives are (reference value); however, only a small segment of people insist on buying the lowest-priced alternative. Conversely, some people shy away from the “top end” model even if they don’t think it’s overpriced, simply because they won’t be able to overcome objections of their financial officer that they didn’t need “the most expensive model”. Solution: add an even more expensive model to your line – even if you never expect to sell it, sales of the previous “most expensive model” might increase.

    For me, the stand-out question is how do we communicate value, thus justifying the price? To that end, are you offering a trial version, with a trial period long enough so that users have the opportunity to use it on a real world problem, and thus get hooked? Are you sending free copies to all the Excel MVPs so they can blog about it? Are you giving a great deal to all your existing customers (me included)?

    • fastexcel says:

      Hi Jeff, thanks for your thoughts. Yes SpeedTools will have a trial period (either 15 or 30 days – many people seem to think 15 days gives better results). Excel MVPs will get free copies but not because I expect them to blog about it! There will be an upgrade price for FastExcel V3 Profiler and Manager, have not decided about an upgrade for SpeedTools but it probably makes sense.

  4. Ross says:

    Interesting thanks for sharing Charles.

  5. Rince says:

    Interesting issue that I too am shortly to face. For products that will be used for business purposes (and most excel addins fall into that category) I take the view that licencing to individuals is barely worth the hassle especially as someone who likes doing crosswords will crack the security and once its out . . . . . Those who will pay (providing its not too expensive) will pay and, as others have found, its good advertising.

    for business use, the situation is different. You have an organisation who may well be publicly embarassed; can be sued; has money etc etc and here is where income is reasonably secure, Go rental (aka annual licence). again a trial period is important – only people with prodiucts of no real value are scared of try before you buy.

    Marketing: Of course MVPs, students etc etc – treat them as advertisers and make your money from the businesses
    Just my 10c

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