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How I’m Making Five-Figures A Month Off Bootstrapped Products

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Re: How I’m Making Five-Figures A Month Off Bootstrapped Products

#41

Post by patio11 »

I had an experience very similar to Brennan's recently. Appointment Reminder, the SaaS which I wish was the center of gravity of my business at the moment, is profitable but not profitable enough to hire the folks and buy the things that I want to accelerate growth of it.

So I have been supporting it by consulting, but when I'm consulting I'm not selling Appointment Reminder accounts, and consulting is always more distracting than I expect it to be. (You think I would realize this after two years of it, but I persistently underestimate how much time it takes to e.g. prospect for new clients, negotiate/schedule engagements, travel to them, and deal with follow-up stuff like invoices.)

The traditional option for scaling a software business with a working product and actual customers is to take investment, but that's another ball of wax. There's fairly attractive options in angel investing these days, but taking any outside money would have an outsized effect on the character of my business at the moment, and I'm not ready to pull that trigger yet. Also, like consulting, raising an investment round is a very distracting event -- it basically commits you to months of doing near no productive work. (And unlike consulting, taking investment causes time debt which is impossible to discharge until you exit your business: you're now committed to keeping those investors happy and in the loop for, well, forever in business terms.)

But, having seen a lot of smart software companies do side projects (37signals was a big fan of it, and Amy Hoy and company have quite a bit of success) I decided to try my hand at it once and see how it went. So I started packaging one of my most-commonly-a-win consulting offerings as an online course, and decided to experiment with it once. (And, like Brennan says and like everybody in the space will tell you, I started by making an email list and sending them lots of free stuff they enjoyed which further burnished my credibility on the subject.)

The experiment was very successful: my customers seem to have liked what I produced, many of them have actually used it to positive effect in their business, and it raised a significant amount of money. (I'll probably blog in detail about it later).

An unanticipated side effect was, because of the topic I picked for my video course, I actually sat down and took all my own advice for a change (AR had an email strategy which I would have never let fly at a consulting client simply because I shipped the minimum necessary and never revisited that decision), and that ended up working out very well.

So, basically, yes: confirmation from someone else, this does work and it is perfectly compatible with running a software business.

Re: How I’m Making Five-Figures A Month Off Bootstrapped Products

#43

Post by fooandbarify »

davidw wrote: post #35
johnrob wrote: post #34

The depressing truth about the software business is that most of the success stories take the form "and then I started spending all my time on marketing, and my business took off!". I say depressing because most software developers didn't choose their profession out of a burning desire to become a marketer.

Nothing depressing about that - it's part of what needs doing. The thing I sometimes find a bit depressing is that there's more money to be made selling tools to the miners than there is in the actual products. For instance, I bet patio11 could make way more money from consulting/seminars/books/courses/motivational speaking (haha, just kidding, sorry Patrick:-) than from AR, from how he's describing it.

I'm not sure that's true. My hypothesis is that we find it easier to meet and communicate with people similar to us, so marketing a product aimed at other developers is an obvious path. There is lots of money to be made by getting out of our stupid little bubble--last week I went for coffee with a guy that sells a modern UI for a legacy system in the construction industry. His code base is probably not the prettiest, and he has less than ten clients, but he is a multi-millionaire.

Re: How I’m Making Five-Figures A Month Off Bootstrapped Products

#46

Post by fauigerzigerk »

bdunn wrote: post #36
johnrob wrote: post #34

The depressing truth about the software business is that most of the success stories take the form "and then I started spending all my time on marketing, and my business took off!". I say depressing because most software developers didn't choose their profession out of a burning desire to become a marketer.

That's sort of like saying "the depressing truth about relationships is that you need to go out and meet people to get involved in one." I take a lot of pride in promoting my products. Marketing is just storytelling, and when your story aligns with the needs of someone else, a transaction occurs. Honestly, if you want to just write code all day (and there's nothing wrong with that) don't create a product - work for s…

That defeats the purpose. If I have a great idea for a product and I want to work on it, why would I go work for somebody else instead? A much better idea would be to join forces with a marketing guy or girl or hire one.

Re: How I’m Making Five-Figures A Month Off Bootstrapped Products

#48

Post by larrys »

patio11 wrote: post #41

I had an experience very similar to Brennan's recently. Appointment Reminder, the SaaS which I wish was the center of gravity of my business at the moment, is profitable but not profitable enough to hire the folks and buy the things that I want to accelerate growth of it. So I have been supporting it by consulting, but when I'm consulting I'm not selling Appointment Reminder accounts, and consulting is always more di…

I think there is a key difference between appointment reminder and the two other things (consulting and the course).

AR is something that will provide residuals that will continue for quite some time. During that time you will have to improve the product (at your leisure) and basically keep the infrastructure running. In return you will collect $29 to $199 per month, every month. No need to resell those that are already paying you money. You just have to keep them happy. Although I have some issues with the price points you have chosen (I know you have probably blogged about this and know much about it I would have taken a different strategy) leaving that aside for now I see the other things you are doing as simply distractions (as you realized) from spending time on the thing that will pay off long term.

I had an opportunity, way way back, to get in on the ground floor of the PC business but didn't have the capital. Instead of getting others involved I started another business to earn money which I sold profitably after 10 years but it was no way as successful as fulfilling the thing that I started out would have been. It was just a distraction. You stand the chance at getting sucked into the "success" of the consulting and the courses because they are making you money. And what will happen is that instead of creating things with residuals (like AR) you will constantly have to work to keep that up with new ideas and materials. Rather than just being able to have a residual business, which, from my opinion and experience, is much better. My advice is therefore to bite the bullet and take money from others that will allow you to grow the SAAS (and then create other SAAS).

My quick idea would be to setup a network of college students to sell the white label version walking literally door to door in office parks signing up professionals (doctors dentists) to use this product by giving them 3 months for free or something like that.

Re: How I’m Making Five-Figures A Month Off Bootstrapped Products

#49

Post by patio11 »

31reasons wrote: post #37
johnrob wrote: post #34

The depressing truth about the software business is that most of the success stories take the form "and then I started spending all my time on marketing, and my business took off!". I say depressing because most software developers didn't choose their profession out of a burning desire to become a marketer.

"most software developers didn't choose their profession out of a burning desire to become a marketer." I agree, if you choose to be a pure software programmer type then of course you can be just that. You can work in a core team or do research in academia. But if you have an entrepreneur itch you have to learn marketing and sales. In fact its pretty fun once you begin to realize that marketing also has lot of intell…

Also being a dev who can market is an unfair advantage over substantially all devs and substantially all marketers. It is seriously unreal.

An example near and dear to my heart: consider an engineer, a marketer, and one of us weird chimeras all studying a graph of feature adoption among the userbase. The engineer things "Hmm, only 20% of the customers use X. That's unfortunate. Maybe they don't need it." The marketer thinks: "Maybe we should mention that in our newsletter." The chimera says: "All users who haven't Xed with receive a guide to why they want to do that automatically on the 4th day of the trial and it is also covered in the onboarding process. That's live in production as an A/B test. We'll know in two weeks whether it is a discoverability problem or a user need problem. Oh, that's actually a good point, maybe we should talk to the users about this. BRB guys I'm off to call five successful trial accounts who don't X and ask why."

Re: How I’m Making Five-Figures A Month Off Bootstrapped Products

#50

Post by davidw »

fooandbarify wrote: post #43
davidw wrote: post #35

Earlier quoted context omitted.

Nothing depressing about that - it's part of what needs doing. The thing I sometimes find a bit depressing is that there's more money to be made selling tools to the miners than there is in the actual products. For instance, I bet patio11 could make way more money from consulting/seminars/books/courses/motivational speaking (haha, just kidding, sorry Patrick:-) than from AR, from how he's describing it.

I'm not sure that's true. My hypothesis is that we find it easier to meet and communicate with people similar to us, so marketing a product aimed at other developers is an obvious path. There is lots of money to be made by getting out of our stupid little bubble--last week I went for coffee with a guy that sells a modern UI for a legacy system in the construction industry. His code base is probably not the prettiest,…

Here's why I think it's true in some abstract sense. Actual details may not be quite so clear cut - apologies to patio11 if I'm tweaking things a bit to make a point.

Let's take the bingo card thing and ignore Appointment Reminder: it makes good money, but seems to have some kind of upper bound in that he's never going to turn it into a multi-billion dollar business.

On the other hand, he's developed some serious competence in things like A/B testing, email marketing, and things like that, and is able to demonstrate their effects on companies' profits and thus command a percentage of those profits or at least get paid really well. So, by selling to companies that deal in the millions of dollars, it's almost mathematical that he's going to bring in more money than by fiddling around with niche products.

That's not to say he could have gotten to B without first going through A (sorry:-), as he gained those skills with the niche product.

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