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Congratulations! But maybe "bootstrapped" is not a 100% correct. > MAY 2020 - Joining Tinyseed > And this is precisely why we never decided to raise money. Ho

Congratulations! But maybe "bootstrapped" is not a 100% correct. > MAY 2020 - Joining Tinyseed > And this is precisely why we never decided to raise money. However, a few years ago, [...] An accelerator designed precisely to help people grow their business [...] The money and the support we got from the program helped us grow ScrapingBee into what it is now

daolf 5y ago
This blew way out of proportion. Misleading people was never the intent. We just wanted to share our story and give a little more "human" touch to our about-us page by sharing the journey. Title was amended. Have a good week-end HN!
- reitzensteinm 5y ago
  For what it's worth, I think people are nit picking rather than crying foul. It's a great story, thanks for sharing it!
  - AlchemistCamp 5y ago
    I hadn't commented on this thread previously, but I did flag it due to the title. It just wasn't honest. Selling a double digit % of the company to investors and then calling it bootstrapped while promoting it here is hard to defend.
  - tessierashpool 5y ago
    seems more like a little bit of both.
- rexreed 5y ago
  I might speak for some of those critical by saying that you got my attention with the "bootstrap" hook but immediately lost it when I saw the funding. At that point I had a hard time believing and following the rest. This might seem like a small nit, but it comes to the honesty and intent of the piece. Good job getting our attention tho. And pay attention to the details.
daolf 5y ago
Co-founder here, I was waiting for this comment to be honest. So in essence, if you consider that bootstrapping is building a business without external funding, you're correct. But to me, bootstrapping VS "VC road" is much more nuanced than this. Going the VC road forces you to have crazy growth and raise more round because the VC model only works if they fund unicorn 1 time out of 100(0). TinySeed works even if they fund 8/7 figures businesses, and this was our goal. We had no money when we began (we went through most of our savings during our first venture), no family to raise an angel round and this solution was perfect for us. The amount of money we got was nothing near what we could have had raising traditional money, but it allowed us to stay independent and grow at our own pace.
- czbond 5y ago
  @Daolf - congrats on the building, definitely NOT easy to do. What growth metrics did Tiny look at? Did the investment come at a time when the business was needing to "survive, sustain, or grow"? [every business has all of those phases]
  - daolf 5y ago
    Thanks a lot. > What growth metrics did Tiny look at? I assume you mean during the application process. So they asked just the basic stuff, MRR, growth, churn. We were at $1k5 MRR when we applied and $3k when we got it. I think what worked for us during the process was that Kevin had been running a small Java web scraping blog + book at that time. > Did the investment come at a time when the business was needing to "survive, sustain, or grow"? We were slowly switching from survival to sustain mode. They allowed to make the transition and go full grow mode.
    - robocat 5y ago
      > They allowed to make the transition and go full grow mode. The point of bootstrapping is making the compromise where you trade a lower growth rate for the benefit of retaining 100% ownership of your business. Your statement is a VC funding model, even if the money is called seed and you are not trying to become a unicorn. Your giving away equity for money is simply not bootstrapping. Calling your business bootstrapped is lying in my opinion. What I think doesn’t matter, but being deceitful is silently judged by others where their opinions do matter to you, and the consequences of that are usually invisible.
mritchie712 5y ago
TinySeed != traditional VC The biggest problem most people have with traditional VC and thus prefer to "bootstrap" is the pressure to grow too fast. TinySeed has none of that pressure. Boostrapping vs VC is a spectrum and Scrapping Bee is clearly on the bootstrapped side of that spectrum.
- codegeek 5y ago
  No. They got money in exchange for equity. If the company fails, they don't have to pay that money back. There is no personal guarantee from the founders. Bootstrapping means that you either used your own money or you got loans for which you are personally liable (credit card/bank loan/SBA etc).
- bonestamp2 5y ago
  I'm not OP, and maybe my understanding is wrong, but I always understood "bootstrapped" to mean they only put in their own money and didn't get any outside investments. Is there a better set of terms to differentiate between self funded, accelerator funded, and VC funded?
YPCrumble 5y ago
This bootstrapping like how War is Peace, Freedom is Slavery, and Ignorance is Strength!
dreig 5y ago
Looking at their MRR growth, it seems that they had ~$5K MRR in Spring of 2020, at the time they joined TinySeed. So perhaps a more technically accurate post would be: "How we bootstrapped to $60K ARR, then took a small investment and grew the company to $1MM ARR" ? When, in the lifecycle of the company, can you sell a small stake of it and still call it bootstrapped? Basecamp sold a bit of equity in 2006 to Bezos[1], and is still considered the epitome of the bootstrapped company. Additionally, if one has a couple hundred K after working at MANGA or wherever, or has wealthy parents/friends and uses that money to build their own start-up, is that still bootstrapping? To me, their journey is much closer to bootstrapping, and is quite an impressive achievement. Congrats, guys! [1]: https://m.signalvnoise.com/the-deal-jeff-bezos-got-on-basecamp/ https://m.signalvnoise.com/the-deal-jeff-bezos-got-on-baseca...
deleted 5y ago
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daolf 5y ago

This blew way out of proportion. Misleading people was never the intent. We just wanted to share our story and give a little more "human" touch to our about-us page by sharing the journey. Title was amended. Have a good week-end HN!

reitzensteinm 5y ago
For what it's worth, I think people are nit picking rather than crying foul. It's a great story, thanks for sharing it!
- AlchemistCamp 5y ago
  I hadn't commented on this thread previously, but I did flag it due to the title. It just wasn't honest. Selling a double digit % of the company to investors and then calling it bootstrapped while promoting it here is hard to defend.
- tessierashpool 5y ago
  seems more like a little bit of both.
rexreed 5y ago
I might speak for some of those critical by saying that you got my attention with the "bootstrap" hook but immediately lost it when I saw the funding. At that point I had a hard time believing and following the rest. This might seem like a small nit, but it comes to the honesty and intent of the piece. Good job getting our attention tho. And pay attention to the details.

daolf 5y ago

Co-founder here, I was waiting for this comment to be honest. So in essence, if you consider that bootstrapping is building a business without external funding, you're correct. But to me, bootstrapping VS "VC road" is much more nuanced than this. Going the VC road forces you to have crazy growth and raise more round because the VC model only works if they fund unicorn 1 time out of 100(0). TinySeed works even if they fund 8/7 figures businesses, and this was our goal. We had no money when we began (we went through most of our savings during our first venture), no family to raise an angel round and this solution was perfect for us. The amount of money we got was nothing near what we could have had raising traditional money, but it allowed us to stay independent and grow at our own pace.

czbond 5y ago
@Daolf - congrats on the building, definitely NOT easy to do. What growth metrics did Tiny look at? Did the investment come at a time when the business was needing to "survive, sustain, or grow"? [every business has all of those phases]
- daolf 5y ago
  Thanks a lot. > What growth metrics did Tiny look at? I assume you mean during the application process. So they asked just the basic stuff, MRR, growth, churn. We were at $1k5 MRR when we applied and $3k when we got it. I think what worked for us during the process was that Kevin had been running a small Java web scraping blog + book at that time. > Did the investment come at a time when the business was needing to "survive, sustain, or grow"? We were slowly switching from survival to sustain mode. They allowed to make the transition and go full grow mode.
  - robocat 5y ago
    > They allowed to make the transition and go full grow mode. The point of bootstrapping is making the compromise where you trade a lower growth rate for the benefit of retaining 100% ownership of your business. Your statement is a VC funding model, even if the money is called seed and you are not trying to become a unicorn. Your giving away equity for money is simply not bootstrapping. Calling your business bootstrapped is lying in my opinion. What I think doesn’t matter, but being deceitful is silently judged by others where their opinions do matter to you, and the consequences of that are usually invisible.

mritchie712 5y ago

TinySeed != traditional VC The biggest problem most people have with traditional VC and thus prefer to "bootstrap" is the pressure to grow too fast. TinySeed has none of that pressure. Boostrapping vs VC is a spectrum and Scrapping Bee is clearly on the bootstrapped side of that spectrum.

codegeek 5y ago
No. They got money in exchange for equity. If the company fails, they don't have to pay that money back. There is no personal guarantee from the founders. Bootstrapping means that you either used your own money or you got loans for which you are personally liable (credit card/bank loan/SBA etc).
bonestamp2 5y ago
I'm not OP, and maybe my understanding is wrong, but I always understood "bootstrapped" to mean they only put in their own money and didn't get any outside investments. Is there a better set of terms to differentiate between self funded, accelerator funded, and VC funded?

YPCrumble 5y ago

This bootstrapping like how War is Peace, Freedom is Slavery, and Ignorance is Strength!

dreig 5y ago

Looking at their MRR growth, it seems that they had ~$5K MRR in Spring of 2020, at the time they joined TinySeed. So perhaps a more technically accurate post would be: "How we bootstrapped to $60K ARR, then took a small investment and grew the company to $1MM ARR" ? When, in the lifecycle of the company, can you sell a small stake of it and still call it bootstrapped? Basecamp sold a bit of equity in 2006 to Bezos[1], and is still considered the epitome of the bootstrapped company. Additionally, if one has a couple hundred K after working at MANGA or wherever, or has wealthy parents/friends and uses that money to build their own start-up, is that still bootstrapping? To me, their journey is much closer to bootstrapping, and is quite an impressive achievement. Congrats, guys! [1]: https://m.signalvnoise.com/the-deal-jeff-bezos-got-on-basecamp/ https://m.signalvnoise.com/the-deal-jeff-bezos-got-on-baseca...

deleted 5y ago

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