Reflecting on my first 2 years bootstrapping!
In July 2018 I quit my job and tried to build a profitable SAAS with a lifelong friend of mine.
The first time we failed, hard: $600 MRR after 1 year.
We tried again and had a bit more luck: $75k ARR within 12m.
The reddit link is here: https://www.reddit.com/r/startups/comments/hnfdhe/reflecting_on_my_first_2_years_bootstrapping/
1. This thing takes time
Bootstrapping a SAAS is long, very long.
Of course, you'll hear about fast growth but real overnight successes are very rare.
Most of the time, when you look behind you'll find:
- years of building an audience
- several failed attempts
Talk to your users early
One easy way to do it is by offering 10x what your free plan offers to people willing to spend 15 minutes on the phone with you.
You'll get feedback from people who really want to use your product. We did it and really had amazing insights.
For every customer giving you feedback, assume that 10 others felt the same way but did not care enough to tell you.
"3" is a number I like.
We start talking about implementing a new feature every time 3 users ask for the same thing.
Clues that you're doing something wrong:
- You had a 3 days down-time and no one bat an eye
- You have < 1% conversion rate on your landing page
- People love to talk with you but never pay you
Question asked by
July 8, 2020, 11:49:13 AM
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How much do I have to give my audience so they can pay me something in return? What do they value? what problem do they search for answers on your own? I want to solve that problem.
Brand means name recognition. A lot of people knows what your company does and what you stand for. Brand is result of long campaign of consistent value provision and media cultivation. Brand helps a company reduce marketing cost.
Whether there are buyer willing to pay or not. For that to happen you must provide extreme value. The entire startup process would be based on guess before the validation. Validation happens in a market, not on the street.
Value is what you give customers beyond the price you charge. Value is effective solution to a problem. The price your customer pays reflects whether the problem is big for them and whether your solution is uniquely effective. Value stems from quality and detailed work.
Marketing means bring your product to the market and bring your message to your customer. Marketing is not salesmanship. Marketing is to penetrate the world of commerce through many barriers and existing networks.
Minimally viable business, or MVC, minimally viable company. A company that scrapes by, full of guess and hope and no traction and sales. When you give your customers things for free they all take it. But they never pay and you can never rent a table at the market.
Minimal viable product. A full artifact of a real product. Something that works ALL THE TIME. You can demonstrate the real effect on real people - not to sell hope. The MVP may not have certain non-essential bells and whistles, but it needs to have appeal value.
Customer is king
A business lives at the mercy of its customers. You provide your customers 10 dollars worth of value and they pay you 1 dollar, not knowing that your company only costs 99 cents to provide the item. The value is not the item - the value is what is attached to the item.
Company culture is based on a company making money. Once your workers are paid, they need to have a mission and aspiration so they are not bored everyday and make trouble in the work place.
A company valuation is cash investment divided by the percentage. As long as your story is good, the valuation will keep coming, and the investors will keeping falling into the line.
Return on investment
Investors are either behind family fortune (never work with them) or for rich clients as investment vehicle. Both need returns 2-3 times better than stock market darlings.
Having found what people want, not just what people may need. Your offering and their acceptance is sure, no longer a guess. You can provide it for profit, and you can indeed making living on it. Traction is sometimes called validation. You are no longer a theater. You have touched nature, and found cash vein.