When Ben and I founded Podigee, we didn't care too much about bootstrapping versus fundraising. We first worked on solving a real-world problem. We focused on our product and technology. We talked to like-minded people in the podcast space and asked them about their biggest challenges and pains.
And then we would build, build, and build. We would quickly brainstorm ideas and pursue them. And that was the point in time when the reality of building a tech product collided with the reality of growing a business.
We knew nothing about running a business back then. We couldn't even imagine what it would be like. There is a saying that states we cannot see what we don’t know. So we didn't even think about running Podigee as a business. We ran Podigee as a software product, a solution to problems. A solution, that we would regularly put out into the world.
Sure enough, we did think about it as a business, but we didn't realize it back then. From the beginning, we knew that we were creating Podigee to serve customers — paying customers. We almost naturally settled for the SaaS model, as it seemed the most logical for a product with a significant part of the infrastructure to be maintained. The value we were generating was constant and recurring; thus, our revenue model had to become recurring as well.
“If we don’t know it, we shall learn how to do it.”
This is the most important aspect of a bootstrapped mentality. As a founder, if you don’t know how to do something and you don’t have the cash to pay someone else, you just learn to do it yourself. It is much more powerful to understand many different things as a founder. The more people involved and the bigger the team, the more stuff gets lost in translation. I often imagine being able to solve something by myself in terms of speed like accessing a CPU's on-chip cache, which is super fast. If you hire someone to work at the company, this person is like accessing RAM. Much slower than the CPU cache (the person is not slower, the communication is!). If you grow into having an entire team of people around one area of the business, they become more like accessing an SSD. And if that team was hired by a VC-driven money-burning machine some people call "a startup", access speed becomes more like accessing a spinning HDD from the 1990s.
“If it is expensive, let’s find a cheaper way.”
No money, no trouble. If you cannot afford the perfect solution because it exceeds the tiny budget you have, you go for an alternative solution. If you make it a habit, instead of burning the little money you have, you invest a small amount into a solution that might solve 80% or even 90% of your problem for a fraction of the cost. But it could solve this one problem really, really well.
As a bootstrapped founder, it is wise to be open-minded and move to different solutions and approaches quickly.
“If it can be automated, automate it.”
The things that you automate in the beginning of your product and business are the things that will stay automated forever. The things that you don't automate in the beginning will most likely be with you many years into the future of the business. So choose wisely when not to automate. Automation can sometimes feel tiring and energy-consuming. Because it is. Especially when developing code for a solution that is supposed to automate a process that a human can do manually without any questions asked, you must start thinking about the entire problem space ahead of time.
When designing and developing an automated process, you must develop the skill of understanding the problem and issues that the person working on the manual version of the process process is facing. Especially engineers struggle to imagine how some people might not understand the logic behind their solution.
People are not that rational, although we love the idea of thinking that we are.
“If you can do without a hire, go without the hire.”
It seems trivial, but overhiring is one of the most common mistakes founders make. In VC-driven businesses, this is the norm and what is expected. As silly as it looks, burning through hundreds of thousands of dollars just to realize that your productivity has actually decreased is really extremely common.
At Podigee, we made the same mistake, but for a different reason: some kind of imposter syndrome. We thought that by hiring “actual experts,” these experts would tell us how to run the business better than us. The truth is, these experts would pretty much never know better than we did, as founders. Nor would they care as much. Actually, some of these experts might want to push you into a direction that benefits them instead of the company. It happened too many times at Podigee to consider it bad luck.
So, if you can, prefer not to hire and only do so if you really need it, and always make sure not to delegate core responsibilities or decisions.
"Build, build, build."
When it comes to outcomes, what matters the most is what you make out of your day. This is why small teams win over big ones: you focus more on building and less on politics. You focus on doing instead of being in meetings and getting the buy-in from tons of managers, team leads, their agendas, and what have you. A small team is a swift team, a nimble one. It can deliver great results even if its resources seem limited, as compared to the big players. But if you defocus from politics and truly focus on delivering something of value that your customers will appreciate, you cannot go wrong. Plus, since you have a small team, you have little cost. And little cost is a very good friend of profit; they went to school together and are besties still to this day.
There is so much more that can be said about how to run a business based on no external cash and a small team. But I will leave these for the next time.