Startup Bootstrapping Plan
Published in 2021, this chronicle by @tosh details the mechanics of building a profitable, self-funded business without venture backing.
Core Principles for Independent Builders:
Charging customers from day one acts as the ultimate filter for building software that solves genuine, high-urgency problems.
Keeping fixed overhead low and leveraging lean infrastructure allows founders to stay alive until market tailwinds kick in.
Small, repetitive improvements in customer retention and conversion rates yield massive returns over multi-year horizons.
Community Debate Themes:
The community focused on B2B customer acquisition channels, cold email vs SEO distribution, and balancing full-time employment with side-project development.
CATEGORY Bootstrapping & MRR →
HISTORICAL ERA Pandemic Bubble (2020–2022)
COMMUNITY SCORE 152 points
TOTAL DISCUSSIONS 32 comments
Some good advice, some not so good.
For example, he recommends A) going after a big B2B market with lots of existing demand (good)
Then he recommends B) spend on advertising instead of content marketing (not so good)
You can't both do A and B. Big markets with lots of demand also have tons of competition in the advertising space.
The talk he's referencing for these tips is from almost a decade ago (Jason Cohen's microconf talk). I'm sure Google adwords was a much more viable strategy back then, however, if you're remotely close to a big market in B2B, adwords is now going to be cost-prohibitive for growing a bootstrapped business.
The reason Jason's personal blog didn't convert well is because his content wasn't targeted towards the products he was creating. If you're writing about general life/tech news/etc. the chances your audience will overlap with a niche B2B product offering are slim to none.
On the contrary, most of the B2B Saas startups I've worked with in the last 5 years grow almost entirely from SEO.
Content is like real estate. Once you start ranking for a few key niche search phrases, your position grows in value over time, without you doing anything.
Advertising on the other hand is like a money treadmill. The minute you step off the treadmill, you're no longer getting leads...at all.
If you want to bootstrap a sustainable business, ignore content/SEO at your own peril.
It'd be far more accurate to say that marketplaces are very difficult products/services to build out, not bad markets. And you plainly don't have two businesses, the two sides of the marketplace are not separate businesses at all, they're two required aspects to that one business. That's not uncommon in business. If you open a convenience store you don't just need inventory, or a building/location, or employees, or customers, or a POS system, you need all of those things, that doesn't mean it's multiple businesses.
There are few better businesses than marketplaces once you get one established. They're monsters then. You have to nearly intentionally screw them up to lose the captured market. Just ask eBay, across its existence it has just about done every variety of thing wrong you can (not at the same time), and its monopoly remains 20+ years later, printing fat margins the entire time. Nobody can unseat it. There it is, $2b-$3b in operating income year after year. Amazon tried to take them down and failed spectacularly. What eBay does isn't complex per se, it's that they successfully built a marketplace, and that tends to come with a huge moat. Etsy will likely enjoy a similar moat, assuming they don't do anything drastic to mess it up.
I highly disagree.
Yes, B2B subscription / SaaS has a lot going for it. Lower price sensitivity, potential for negative churn, etc.
But dismissing B2C subscriptions is pretty terrible advice. Things have changed over the past few years and there's potential to build both healthy "side hustle" B2C subscription businesses as well as large venture-scale ones.
I work on a venture-backed B2C subscription startup, and despite what investors told us when we started building, we're seeing pretty healthy willingness-to-pay right now.
"Money back guarantee >> free trial"
is there an explanation for this? I tend to favor free trial myself because the "money back" seems like a headache to go through if I'm not happy with the product.
"Consumers complain about cost all the time Companies don't. It's that simple"
But don't company expect a much higher uptime and level of support? I would imagine that a bootstrapped startup would have limited bandwidth to offer support SLA for example.
For B2B, after years of software subscriptions with sudden 10x or 100x price increases, there is a bit of fatigue and companies are a bit more wary than they were 5-10 years ago. The expectation of price increases are now baked into the cost forecasts. Getting approval for $250/mo is actually a harder sell in many companies than getting a one-time approval for $25,000.