3 ms·

Good questions, thanks for those. When working alone on the project I feel like the momentum gets lost sometimes. Sometimes I'm busy building a feature that ta

Good questions, thanks for those. When working alone on the project I feel like the momentum gets lost sometimes. Sometimes I'm busy building a feature that takes a lot of time and don't have time for other features or bugs. Or when working on marketing there is no time to build new stuff. There might be a future when I'm not coding at all and only responsible for the other aspects of the business. That's why I'm already hiring a freelancer. Normally the freelancer would work 1 day a week which is about half the time he worked in January. Not sure if I would consider it as essential though, because I can always take over and do it all myself. But I'm not planning to do it all myself. Freelancer costs will not scale as much as traffic would scale. As the work of the freelancer is related to new features. Most of our systems can handle a lot of traffic and if we can't anymore we need to add more hardware (which will be recurring) or write some software (which is not recurring). As for recurring gross margin. Would a list/graph of recurring costs be sufficient? Combined with the monthly recurring revenue of course.

encoderer 7y ago
It’s not too late to find a cofounder. I would consider it if I were you. You can vest their equity (and even consider vesting a portion of your own to show continued commitment). One reason: vacations are nice.
- MrQuincle 7y ago
  Ha, this is my brother. He's a digital nomad large part of the year. Plenty of "vacations"... He's a hard worker though. Props to you, brother! :-)
mason55 7y ago
> Not sure if I would consider it as essential though, because I can always take over and do it all myself. But I'm not planning to do it all myself. Well, for starters, you should be putting a value on your time if you're doing work. At least the work to support the product should be tracked and valued. And for all the work that you and the freelancer are doing, you should be splitting it into COGS vs. R&D. The problem comes if you're doing a bunch of support work that you're not accounting for. Then you go to sell the business and it turns out that it takes a whole FTE to support the product. You're talking about $300k/year in unaccounted costs that you'd need to account for if you were to ever stop doing all the support (either because you become full-time CEO or you sell the business). It's also easy to fool yourself into thinking you have a real business if you don't account for your own time. It's easy to just create a job for yourself and not actually create a business. > Would a list/graph of recurring costs be sufficient? Yeah, I think you need to take all your costs and all your revenue and bucket them as one-time vs. recurring (or COGS vs. R&D, whatever you want to call it). This is the kind of thing anyone is going to want when they're valuing a SaaS business.

encoderer 7y ago

It’s not too late to find a cofounder. I would consider it if I were you. You can vest their equity (and even consider vesting a portion of your own to show continued commitment). One reason: vacations are nice.

MrQuincle 7y ago
Ha, this is my brother. He's a digital nomad large part of the year. Plenty of "vacations"... He's a hard worker though. Props to you, brother! :-)

mason55 7y ago

> Not sure if I would consider it as essential though, because I can always take over and do it all myself. But I'm not planning to do it all myself. Well, for starters, you should be putting a value on your time if you're doing work. At least the work to support the product should be tracked and valued. And for all the work that you and the freelancer are doing, you should be splitting it into COGS vs. R&D. The problem comes if you're doing a bunch of support work that you're not accounting for. Then you go to sell the business and it turns out that it takes a whole FTE to support the product. You're talking about $300k/year in unaccounted costs that you'd need to account for if you were to ever stop doing all the support (either because you become full-time CEO or you sell the business). It's also easy to fool yourself into thinking you have a real business if you don't account for your own time. It's easy to just create a job for yourself and not actually create a business. > Would a list/graph of recurring costs be sufficient? Yeah, I think you need to take all your costs and all your revenue and bucket them as one-time vs. recurring (or COGS vs. R&D, whatever you want to call it). This is the kind of thing anyone is going to want when they're valuing a SaaS business.