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We bootstrapped to $11M in ARR
- cosmodisk 6y agoOne thing I don't understand is this notion that any startup can happen only in the valley,or if someone starts there, it's 100 times easier. The main benefit,which the US startups take for granted is the market size. You don't need to learn German, French ,or Spanish just to sell to your neighbors.
- ithinkso 6y agoWell, of the two neighbors, one speaks Spanish and the other speaks French a bit
- jerrre 6y agoI think the point is that the US is so big that you don't to reach the neighbors
- hinkley 6y agoWhen I was coming up there was a huge brain drain going on from the midwest. A lot of those people ended up in Seattle, because of Seattle, NYC and SF, Seattle seems the smallest culture change (that is of course debatable, especially with the Seattle Freeze). Since then Chicago has become eminent in fintech, so I expect some people end up there, but that's not everybody's speed either. Saint Louis is also pretty centrally located from an Internet infrastructure standpoint and as far as I'm aware they've not amounted to much of anything from an IT standpoint since ftp.wustl.edu. It looks like Boeing, Square, and a bunch of banks have offices there. That may have to do with secondary issues like the quality of education in Missouri. Undergrads might not give a damn but founders and VCs might care quite a bit.
- Communitivity 6y agoFrom friends I've talked with, the benefits of the valley are real, but diminishing. At the same time downsides are increasing: cost of living, homelessness, real estate prices (though I read these are coming down a bit). I've been told the benefit has been the ease of networking, and likely will always be so. As startup hubs grow around the country this networking benefit will start to be there. It is already there in some places such as Austin and Boston. There are a number of hubs in the country now, with most outside the valley focusing on one or more niches. Some of these are: - Nanotechnology in Boston and Middlesex-essex, MA - Healthcare Boston, New York City, and the Twin Cities of Minnesota. Big investments though are being made in Kansas, Ohio, Texas, and Pennsylvania - SaaS in Austin,TX - Education in Boston - Fintech in New York City
- nonameiguess 6y agoNorthern Virginia for any sort of federal work, though it's not the same situation since the clearance requirements disqualify most non-citizens, people of foreign birth, or just most people at all since most people don't have security clearances. Still fertile ground for people who meet the requirements, though.
- Communitivity 6y agoAgreed. I think defense startups are different animals though, based on my experience as a contractor in startup size defense contracting firms in the past. I could see different networking circles, different hiring requirements (you mentioned clearances), different software setups (I've worked on teams where using git over ssh not allowed on government networks). I plan the curate the results from this ask into https://github.com/BillBarnhill/AwesomeStartupHubs https://github.com/BillBarnhill/AwesomeStartupHubs, and will include defense hubs there too.
- catillac 6y agoIs “SaaS” traditionally considered a niche like the others? The concept seems very broad as opposed to others like Fintech or Healthcare. I would consider a category like “APIs” to be overbroad, and SaaS seems to be similar. I’m very open to being wrong though.
- brianwawok 6y agoSaaS is all over. I can think of 100 SaaS companies by me in Indiana, and I didn't look that hard. I think it's not an Astin niche...
- vram22 6y ago>SaaS is all over. Yes. By its very nature. Plus, SaaS is more like a horizontal niche (though I would really call it a layer, with, e.g. shrink-wrapped software being another horizontal layer), while fintech, healthcare etc. are vertical layers[1]. In fact, the industry jargon term (outside of the narrow world of tech, at least), is "verticals". Ask any marketing guy. Verticals are usually defined by the business domain they apply to. [1] E.g.: you can have a fintech SaaS and a healthcare shrinkwrapped app, and vice versa, and so on.
- mizzao 6y agoIs it possible to bootstrap a consumer startup in the same way as a B2B SaaS? Seems a lot harder, given that revenue from day one is not easy.
- jeffreyrogers 6y agoThey definitely exist. Things like pinboard.in for example.
- tfang17 6y agoI'm the cofounder of Eureka Surveys. We are a bootstrapped consumer startup with 1M+ users and profitable.
- artichikin 6y agoYes -- we've been bootstrapping our diet tracker cronometer for the last 10 years. It's a much slower pace, but nice growing & operating on own terms. It took the first five years before I could quit my regular job -- but now hitting $3M ARR. Designed an awesome workplace in a ski town and have been slowly recruiting other ski-bum / devs to our way of life.
- yboris 6y agoI love the Giving back section <3 > over the past 2 years have managed to donate over a million dollars to local charities I wish more companies were doing this. There are many already -- consider joining the Fouders Pledge https://founderspledge.com/ https://founderspledge.com/ if you're thinking of doing the same.
- wly_cdgr 6y agoGreat product, great company, terrible parties
- zaczekadam 6y agoThis is a pretty exciting blog post. I'm totally stealing the customer swag idea, it's great. Fingers crossed on 100M ARR!
- tfang17 6y agoSeems to be a lot of questions about how bootstrapped startups handle customer support. I'm the cofounder of Eureka Surveys. We're bootstrapped, profitable, and just crossed 1M+ users. We've had an amazing experience hiring customer support in the Philippines. I have a thread about it on Twitter: https://twitter.com/t0mstah/status/1356296043009253382 https://twitter.com/t0mstah/status/1356296043009253382 The tl;dr is that you can hire cheap ($3.50/hr), high quality virtual assistants from the Philippines to handle customer support for you, all from day one. Having CS has really made a difference for us in our business and is one of our main differentiators as we've scaled up the CS team. DM me on Twitter and I can connect you to some excellent VAs looking for jobs!
- iambateman 6y agoHey Tommy, I DMed you but figured I would ask here too...what service do you use for VA?
- goatherders 6y agoSaved for later, thank you for sharing.
- tfang17 6y agoCan connect y'all directly with our source in the Philippines if you DM me on Twitter! Better to go straight to the source in my opinion, rather than using something like Fiverr. Going direct is cheaper, allows you to interview around a bit more easily, and helps build a more direct, long-term connection with the VA as an employer instead of as a contractor.
- cambalache 6y ago- Cheap, high-quality, free-from-exploitation. Pick 2. Spare me the "Life is cheaper in the 3-world non-sense"
- yibg 6y agoWhat do you propose? Don't hire from cheap places or pay them the same rate as expensive places? If companies pays the same as expensive places, why would they hire from cheaper places?
- motohagiography 6y agoI've used the canary tokens and they are probably the most elegant security tool I've seen in the business. What a pleasure to read.
- igammarays 6y agoThe best part? Every penny of that $11M ARR is yours to spend however you wish. Nobody's going to question you if you take your company's money and spend it on a private helicopter or a summer beach home in Cyprus (all easily affordable for $11M). If you had accepted even a tiny pre-seed investment, you wouldn't have that freedom - the company's money is not yours, and although you could live comfortably on executive salary, bonuses, and stock sales, you can't avoid scrutiny until you've sold the company or IPO'ed. The second best part about bootstrapping (specifically: solo bootstrapping)? The immense satisfaction of eating from the work of my own hands. I finally launched my side project last month, and it's making enough to pay for rent and food. I have no other source of income or savings, and the feeling is fantastic -- even though the amount I am earning right now is tiny, far less than what I earned as a private consultant or employee of a VC-backed firm before. I wouldn't trade this feeling of satisfaction for any other job in the world. The freedom of 100% ownership: earning, managing, and spending every dollar without having to answer to anyone is priceless. Taking VC money is just a glorified type of employment with lottery returns.
- teachrdan 6y agoIn the US context, of the company is an LLC then you can't just spend its money like it's yours without "piercing the veil" and jeopardizing your LLC status. But point taken! You don't have to answer to VC whose interests don't necessarily align with yours.
- stickfigure 6y ago> if the company is an LLC then you can't just spend its money like it's yours You can't spend out of the company's bank account, but you can take distributions from the company. At that point it's yours.
- wpietri 6y agoThe first one is only true for a solo founder. Given that they said "we", the company's money is still the company's money. Also, it's not clear to me that avoiding accountability is really a plus for a startup. Basically the first thing I did when I was exploring a solo founder/bootstrapped thing was to hire a startup-focused coach to serve as an accountability partner.
- ismail 6y agoCongrats mh_ and team.
- mh- 6y agoCongrats fellow mh!
- donnythecroc 6y agoThis is awesome
- lostmsu 6y agoFrankly, minding the existing solutions on the market, the product idea sounds extremely useful. No wonder you were able to acquire customers and grow quickly!
- eric4smith 6y agoThe vast majority of businesses.... 1. Are outside the valley 2. Started with minimal or no funding 3. Hire a ton of employees overall 4. Give their founders comfortable lives. 5. Do their thing very quietly without anyone really knowing. 6. You've never heard about.
- divbzero 6y agoI’d love to hear more of these stories, but suspect 5. Do their thing very quietly is in the spirit of many of these businesses.
- mmaunder 6y agoIt is. And there is always a reason private companies post their numbers. Unless there’s a strong reason to do it, it is a better strategic move to keep them private.
- flukus 6y agoAt least for software, the vast majority are in some sort of niche you've either never heard of or thought about. Software for managing operating theater procedures, software for managing doctors/dentists, software for managing money exchanges, software for managing legal conveyancing, software for managing schools, etc. Those are examples from places that I've worked that were purely software shops, add to that just about any sizeable company in any industry that have software developers, everything from you pet food brand to your toothbrush manufacturer likely started outside of silicon valley, most without little to no venture capital. They used to be called micro independent software vendors (mISV) and before the silicon valley gold rush this was the dream of young entrepreneurs.
- spullara 6y agoThose are absolutely terrible companies for software developers to work for though. I have several family members that work for them. If you want average pay and the owners to take all the profits, go for it. Otherwise, work for FAANG, a great startup or a finance company (hedge fund or investment bank).
- jampa 6y agoNice writeup! Speaking as someone that tried to be a founder from Brazil: I imagine that making it on Silicon Valley must be hard task on itself but making in an underdeveloped country makes odds stacked against you. We compete with companies founded with people that have access to clients with way more purchasing power and better supply pipeline. I'm a bit curious on how the team got overcame this issues, and would suggest you to repost this on a time that gets more traffic in americas, since is 3AM here.
- TheMagicHorsey 6y agoRead about the success of Zoho. An Indian company with no funding that has bootstrapped to billions in revenue. And they are doing development in small towns in India. Talk about overcoming the obstacles of an underdeveloped country!
- 0xfaded 6y ago> We compete with companies founded with people that have access to clients with way more purchasing power and better supply pipeline. Your wording flipped a bit in my head. That exact wording could be said of Europe. There's a whole show and dance to make it seem like it's not, but when everything is about government grants and consortiums, it is.
- nmfisher 6y ago> Your wording flipped a bit in my head. That exact wording could be said of Europe. There's a whole show and dance to make it seem like it's not, but when everything is about government grants and consortiums, it is. Sounds very much like Australia, too.
- 0xfaded 6y agoHey, I'm originally from Australia. My take is that Australia is ever so slightly better off since you don't have all the EU state support regulations to comply with. It's unbelievable how good the EU is at wasting people's time. You're also slightly higher on the VC dollars per capita.
- deleted 6y ago[deleted]
- stevoski 6y agoMany of the customers of my B2B SaaS are the type of company from the article. We're small enough that I check out the website of every new company. I continue to be amazed at the sheer breadth of small-ish, profitable companies, often bootstrapped, that I would normally never encounter. Also, a shameless plug for my podcast for people running bootstrapped software companies: https://bootstrapped.fm/ https://bootstrapped.fm/
- mritchie712 6y agoShameless related plug, I run https://www.trypaper.io/ https://www.trypaper.io/ which helps SaaS companies find non-dilutive funding. I don't think Bootstrap needs to mean "no outside capital". There are capital sources out there that align with what most bootstrappers value (e.g. retaining control of their company, calm growth, etc.).
- bberenberg 6y agoFYI there seems to be no way to sign up.
- deleted 6y ago[deleted]
- mritchie712 6y agoWhat's happening when you go here: https://www.trypaper.io/login https://www.trypaper.io/login
- newbie578 6y agoI got a question for which I don't see the answer in the article. What about employee compensation? Is it just a fixed salary or? Since I do not see any mention of going public in the article, so I'm curious what is the motivation for employees.
- mh_ 6y agoWe do average to above average salaries, and all share a profit share bonus at the end of the year. Everyone gets a company credit card to buy books/tech needed to do their jobs. Everyone gets side benefits like an audible subscription, other mini stipends. It's worth noting that we couldn't always do this (starting off we just went with "decent salaries and smart ppl to work with"). We try to keep doing this right so that we all do well as the company does.