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Why FreshBooks Launched a Competitor to Itself After realizing his accounting and invoicing company FreshBooks wasn't innovating fast enough, Mike McDerment had to take extreme measures.

By Jason Feifer

FreshBooks

This is an episode of our podcast Problem Solvers. Each week, an entrepreneur reveals how they overcame an unexpected problem in their business -- and were happier and more successful as a result. The show is hosted by Entrepreneur's editor in chief, Jason Feifer. Listen below, or subscribe on iTunes, Google Play, Stitcher, or wherever you get your podcasts.

Mike McDerment saw the future, and it wasn't bright. His accounting and invoicing company, FreshBooks, was doing well with customers, but behind the scenes, its software code was a mess, and it wasn't able to innovate as quickly as it needed. But fixing this problem was tricky. If he ordered his team to hit pause and fix the code, years could go by and Freshbooks would lose ground to its competitors. And if his team did manage to create a better Freshbooks in the process, customers might be annoyed by the sudden change. So his solution was radical: He launched a competitor to his own company.

Listen to this week's Problem Solvers to see how McDerment did it and what he learned along the way.

Jason Feifer

Entrepreneur Staff

Editor in Chief

Jason Feifer is the editor in chief of Entrepreneur magazine and host of the podcast Problem Solvers. Outside of Entrepreneur, he is the author of the book Build For Tomorrow, which helps readers find new opportunities in times of change, and co-hosts the podcast Help Wanted, where he helps solve listeners' work problems. He also writes a newsletter called One Thing Better, which each week gives you one better way to build a career or company you love.

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