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My sixth year as a bootstrapped founder

mtlynch.io

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Re: My sixth year as a bootstrapped founder

#121

Post by mtlynch »

dannyw wrote: post #45

Try offering an affiliate program if you haven't already. It can increase your sales drastically and you only pay for the results.

I did try that for a while and still have a couple of affiliates, but it wasn't that successful. It could be that I just didn't invest in it enough for it to work.

One of the biggest obstacles was that I hated all of the affiliate apps on Shopify. They all require all your customer data (email, names, shipping addresses), and most of them have privacy policies that grant themselves very broad permissions with user data.

I refused to give up our customer data like that, and so we rolled our own by hand, but it's very manual, so the only way for affiliates to find out their earnings is when I manually run a script and pay them once a month.

Re: My sixth year as a bootstrapped founder

#122

Post by awhitby »

avinoth wrote: post #115
awhitby wrote: post #94

Earlier quoted context omitted.

You're missing something. From the post: > I don’t draw a salary, so the total amount I earned from TinyPilot in 2023 was $236k. and > Result: I worked 35-40 hours per week, a reduction from previous years, and traveled more than any previous year. This is a person who is effectively full-time CEO of this business and whose market salary is likely at least $236k. If they sold the business, the new owners would have t…

Valuing a profit-generating business that's making $1m in revenue as zero is reductive. Valuation of business isn't necessarily determined by profits (perhaps for commodity businesses), It's just one of the metric. This is a business that has strong operations, product, assets, and IP, honestly quite surprised with this take. Also, a nit fwiw, you automatically assumed the entire profit of the business is the market…

I don't really disagree. It's a naive analysis, but ignoring the opportunity cost of the time the owners put into a business, which I was replying to, is even more naive, and yet an extremely common mistake small business people make.

Re: My sixth year as a bootstrapped founder

#123

Post by JonChesterfield »

Their tinypilot kvm works. It's in the category of boring infrastructure - I leave it plugged into whatever machine is currently in need of attention and `https://tinypilot/` connects to it. Little box hanging off the PoE switch, much less bother than plugging a keyboard and monitor in. Especially so when I'm away from the office.

Recommended. Saved me a lot of hassle. Thanks for the product!

I'd like to be able to power cycle the attached machine but that seems inherently messy to implement.

Re: My sixth year as a bootstrapped founder

#124

Post by mtlynch »

W-Stool wrote: post #17
mtlynch wrote: post #2

Author here. As always, I'm happy to take any feedback or answer any questions about this post.

Thanks for writing a great summary of year #6 for your business. Question: where do your advertising dollars go and how do you measure their success? Good luck in year #7!

Thanks for reading!

>where do your advertising dollars go and how do you measure their success?

Sorry, but advertising spend is one of the few things I avoid sharing publicly. Most other things about my strategy, I think our execution is what makes the difference, so I don't care if competitors know. With advertising, it was expensive to figure out a successful strategy, and it's the kind of thing that a competitor can copy perfectly.

I can talk about measuring their success, though. The metric I focus on primarily is revenue on ad spend. Material costs make up about 33% of the revenue from TinyPilot's product sales, so if we get $1.50 for every $1 we spend on ads, we'd end up about breakeven ($1.50 from revenue - $1 for the ad - $0.50 for materials), so I aim to be at 2.25 ROAS or higher on any channel so we have a comfortable margin.

Re: My sixth year as a bootstrapped founder

#125

Post by PH95VuimJjqBqy »

robertlagrant wrote: post #118
PH95VuimJjqBqy wrote: post #109

Earlier quoted context omitted.

then do the calculations in 5 or 50 years.

I don't understand your mindset that says you should decide when other people multiply some numbers.

I don't understand how anyone misread that so badly while genuinely attempting to respond.

I suppose we can both say there are things we don't understand.

Re: My sixth year as a bootstrapped founder

#126

Post by mtlynch »

dheera wrote: post #39
mtlynch wrote: post #20

Earlier quoted context omitted.

Thanks for reading! > Have you run any pricing experiments after that? No, I haven't tinkered with the price much for the past few months. I have a hard time doing price experiments because at my volumes, I have to collect a few weeks of data before I think the evidence is strong, and I don't have a good way to A/B test different prices in parallel, so it's easy for two different time periods to have different result…

> we get emails for a couple of weeks after from people who are annoyed they paid a higher price just before a reduction What if you just explicitly guarantee a price match for say 30 days? People would feel safe and you can do your experiments.

Yeah, I think there are ways we can do it. It's just that with every hoop to jump through and layer of friction, it makes it a little less appealing than other paths to increase revenue, so I end up not doing it.

I think it's very possible that my prices are suboptimal, so I will think more about how I can do some price experiments while minimizing the downsides.

Re: My sixth year as a bootstrapped founder

#127

Post by tgtweak »

JonChesterfield wrote: post #123

Their tinypilot kvm works. It's in the category of boring infrastructure - I leave it plugged into whatever machine is currently in need of attention and ` https://tinypilot/ ` connects to it. Little box hanging off the PoE switch, much less bother than plugging a keyboard and monitor in. Especially so when I'm away from the office. Recommended. Saved me a lot of hassle. Thanks for the product! I'd like to be able to…

It's a good idea for a feature - many other out-of-band solutions have this. I think the issue comes mostly in that you would need to unplug the server to add (and remove...) some kind of relay-controlled power interrupt.

I would assume that most users of this are in a rack/datacenter/server environment and have switched PDUs they can remotely trigger power with, and it might make more sense to build in PDU management as a software feature over the network than try to reproduce the hardware functions.

Would be kind of cool to have a C14 input plug on the device and a C13 out beside it that goes to the server/device, then you can put an relayed interrupt inside it and also an ammeter clamp to measure power draw and detect drops or spikes in device power - for those systems that don't have built in IPMI already.

Re: My sixth year as a bootstrapped founder

#128

Post by ao98 »

pdq wrote: post #98

General question when running a single member LLC: how do you determine how much to take as salary versus business profit, and how does that affect your taxes? I'm guessing tax liability is mostly a wash, as if you are taxed as an S-Corp, you pass through the profit into personal income and pay income tax on that.

That’s very much a talk to your CPA question - because it speaks to audit risk. The IRS wants to see you pay yourself a fair salary so you are paying the appropriate payroll taxes, social security, medicare, etc. The problem is “fair” is somewhat subjective and depends on the profitability of the business as well. I’m sorry this isn’t a clear answer, but it’s just not a clear matter. Seek advice and ask “how would you defend this stance in an audit”.

Re: My sixth year as a bootstrapped founder

#129

Post by educaysean »

boplicity wrote: post #62
abfan1127 wrote: post #10

Earlier quoted context omitted.

in what sense is it getting worse? While there may be local minima, I'd argue that its the best its ever been. News has always been pessimistic because negative emotions are easier to trigger to drive attention which pays the bills.

We've already passed the 1.5 Degree Celsius limit on global warming. That alone has catastrophic consequences. Yet, the production of fossil fuels remains near record levels, and producers are aiming to scale up, as opposed to scale down. Political discourse on this topic often amounts to "but my expenses are already too high." For many people, this is still an abstract and slow moving problem. Yet, it is a very real…

While I agree that global warming is a serious issue without a clear future, it seems a little far fetched to attribute that as a factor in the deterioration of hackernews community's cultural standards.

Re: My sixth year as a bootstrapped founder

#130

Post by mtlynch »

yakito wrote: post #5

Very interesting, Michael, thanks for sharing! As a founder and bootstrapper myself, I really relate to parts of your post (well, not so much to that 2000% jump in profit... haha, maybe one day). I'd like to understand the steps leading up to these six years. What motivated you to create that particular product? was it simply something that interested you and that you believed had potential? What was the goal when yo…

Thanks for reading!

>I'd like to understand the steps leading up to these six years. What motivated you to create that particular product? was it simply something that interested you and that you believed had potential? What was the goal when you created TinyPilot? Thanks!

It was a "scratch my own itch" kind of path. I had a home VM server[0], and any time I messed up its network settings or wanted to install a new OS, it was a huge pain to drag it over to my desk, disconnect my main desktop from my monitor and keyboard, swap everything over to the server, and then put everything back how it was.

I saw an article about how Raspberry Pi could emulate a keyboard, and I tried that out and got it working.[1] And then I felt like there had to be a way to capture video and stream it too, and I finally found a way to do that.

I came in at a lucky time because people had been experimenting with Raspberry Pi as a KVM over IP for years, but there weren't great video capture options. But right as I started looking, these cheap HDMI to USB dongles appeared on the market,[2] which made it cheap and easy to build a v1.

In the beginning, I thought it was too niche to be a real business, but it got a positive response when I launched on HN,[3] and more and more people kept buying, so I stuck with it.

[0] https://mtlynch.io/building-a-vm-homelab/

[1] https://mtlynch.io/key-mime-pi/

[2] https://mtlynch.io/tinypilot/#hdmi-to-usb-dongle

[3] https://news.ycombinator.com/item?id=23927380

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