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> If you're trying to sell software to mid-sized businesses, it can be hard to be profitable. This is not true whatsoever. I've executed diligence services on
by mbesto 10y ago
> If you're trying to sell software to mid-sized businesses, it can be hard to be profitable.
This is not true whatsoever. I've executed diligence services on more than 15 software companies in the last year alone. Many of these are very profitable (80% gross margin and 30% EBITDA) and growing at steady 10-20% rates....you just don't read about them on TechCrunch because they aren't perceived as unicorns.
- rtpg 10y agoSorry, I wasn't clear. Very easy to be profitable in the mid-to-long-term. Things like Drip, WP Engine, And here, ConvertKit all prove this. In theory you don't need 10 years. I was talking more about the initial years. I'm wondering though, how many of those software companies were profitable in the first year? Usually the fastest way to get to profitability is to be very unprofitable at first to build up your base, and then rely on (hate the word but) virality and scale to cross the threshhold. But totally agree that it's very feasible to build a very profitable business in less than the 8 years or so it took FB.