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Bootstrapping a Software Product

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Re: Bootstrapping a Software Product

#41

Post by garrettdimon »

iaskwhy wrote: post #35
garrettdimon wrote: post #19

Earlier quoted context omitted.

I have finally hit my pre-Sifter salary. We could have technically afforded it a while ago, but we only recently decided to make the adjustment. Of course, that was my salary 5 years ago, and from what I've gathered, I'm still way under what I could be making elsewhere--especially if you factor in benefits. Keith, my partner, has never been full-time. He's always been involved at about 5-10 hours per month, and that'…

You do you decide Keith's salary? I'm not looking for numbers, more like the logic behind it (number of hours put in?, something else?). I will have this "problem" soon. Thanks for sharing your knowledge!

Keith doesn't draw a salary at all. His equity is large enough that he's simply banking on the day that we stop re-investing 100% of our profit and start paying out some sort of dividends.

Re: Bootstrapping a Software Product

#42

Post by mkreef »

Great deck. I always wanted to bootstrap. Never would have guessed there is a big enough market to sustain you in bug/issue tracking.

Why do you now offer 14-day free trials when one of the slides is "don't do free accounts, people will use anything if it's free, etc"?

I've had good luck with free SaaS beta/pre-launch and continued free trial accounts (no cc required).

Re: Bootstrapping a Software Product

#43

Post by revorad »

raphinou wrote: post #29
revorad wrote: post #13

Earlier quoted context omitted.

To both you and raphinou and others battling with the same questions, I cannot recommend Rob Walling's work enough. His blog [0], book [1] and podcast [2] address the exact concerns any new software bootstrapper faces. He also runs the Micropreneur Academy, but I don't have any direct experience of that. He also organises Microconf, and I really recommend watching his talk from last year - http://www.microconf.com/vi…

Thanks for the links! Do you know of communities of self-employed/micro-entrepreneurs? I'm not interested in a booming startup scenario, rather looking to build a sustainable business.

I've seen a few people ask this, and a few efforts towards building an online forum for bootstrappers to hang out. But they all tend to fizzle out.

The community is scattered around the web on blogs, Twitter, Mixergy and here. I think that's a good thing - don't seek yet another place to shoot the breeze. Just get stuff done, and when you have a specific question, seek answers from experienced people in existing forums.

Re: Bootstrapping a Software Product

#44

Post by garrettdimon »

mkreef wrote: post #42

Great deck. I always wanted to bootstrap. Never would have guessed there is a big enough market to sustain you in bug/issue tracking. Why do you now offer 14-day free trials when one of the slides is "don't do free accounts, people will use anything if it's free, etc"? I've had good luck with free SaaS beta/pre-launch and continued free trial accounts (no cc required).

Trials and free accounts are two very different things. Free accounts implies that they are perpetually available at no cost.

Re: Bootstrapping a Software Product

#45

Post by mzarate06 »

garrettdimon wrote: post #10

Author of the deck here. I'm actually in the middle of evolving these into a book. http://startingandsustaining.com Happy to answer any questions anybody might have.

You cited early advertising as a good idea, and that continued advertising was a bad idea. Can you talk a little bit about your paid advertising strategy?

Where did you advertise?

Are you willing to share your daily advertising burn?

Any insight as to why the first $5k in advertising was worth it, but everything after that wasn't?

Re: Bootstrapping a Software Product

#47

Post by garrettdimon »

mzarate06 wrote: post #45
garrettdimon wrote: post #10

Author of the deck here. I'm actually in the middle of evolving these into a book. http://startingandsustaining.com Happy to answer any questions anybody might have.

You cited early advertising as a good idea, and that continued advertising was a bad idea. Can you talk a little bit about your paid advertising strategy? Where did you advertise? Are you willing to share your daily advertising burn? Any insight as to why the first $5k in advertising was worth it, but everything after that wasn't?

"Spend" is a very misleading and even distracting metric. Before going to deep into this, it's worth noting that you should never rely on advertising as your sole source of traffic generation when bootstrapping. It gets expensive, and it generally doesn't generate immediate returns. Pay-per-click can be an exception, but that's also an expensive game to get into.

Unfortunately, much of our advertising experience isn't going to be relevant due to how long ago it was. We advertised primarily on FusionAds and Daring Fireball, which has increased from $2,500 to $8,500. We don't have a daily advertising burn, and we never really have as we just dabble in advertising from time-to-time.

I'd be willing to bet that advertising has at best contributed 10-15% to our growth. Given the amount that we've spent, that's a very high cost of acquisition. However, it did help generate some awareness. There's a whole lot of context with advertising. The first $5k was relatively more effective because Sifter was so new. It was great for generating awareness. However, after that initial awareness is generated, unless you're going to spend heavily (more than $10k a month)on a branding campaign any additional impression-based advertising to the same audience generally won't be as effective.

Re: Bootstrapping a Software Product

#48

Post by garrettdimon »

rcirka wrote: post #46

Good points in the slide. A question through, why have 2 web server and two database servers? Was it for performance or redundancy reasons?

I can't tell from your question if you're asking for a simple "performance" or "redundancy" answer or if you're asking for a deeper explanation about application architecture. So, I'll try to answer both.

The short answer is redundancy. With virtual servers, problems on the host machine due to neighboring virtual servers can be frequent. This can slow down the application server and lead to performance problems. With two load-balanced application servers, this isn't as much of an issue.

For the database, I'd suggest reading up on replication. In addition to the master/slave databases, we also have hourly, daily, and weekly snapshots stored offsite because a slave database isn't enough protection from some types of data loss.

Application architecture is a whole beast unto itself, and my real recommendation would be to find and hire a professional to handle this kind of stuff for you.

Re: Bootstrapping a Software Product

#49

Post by mmorrell »

Thanks a lot for this. The point about not going open-source probably just saved me 6 months-1 year of potential time spent. I knew something was bothering me about making my idea open-source at the same time I am making it. Although I'm an idealist, and like open source software, having money doing what I love was my whole goal in the first place.

Re: Bootstrapping a Software Product

#50

Post by yesimahuman »

raphinou wrote: post #4

I will possibly bootstrap a software product in the near future, but the hard part for me is to decide in which market I can find a niche. I find it hard to develop a new solution in a crowded market. I want to develop a product I am convinced of, but doubt often gets in the way, especially if the market is crowded. I also wonder how these services get their first paying customers.

I bootstrapped my company over 2012, and we now employ three full-time people and adding more.

What we did to get out first few users was simple: we wanted to build cool software, and we had a few ideas. We took our favorite, built a cool landing page that spelled out the features with a demo, and then set it free on Twitter. We had 1500 early beta signups before we went into private beta. We now have over 100,000 users and we never spend money advertising.

In terms of getting our first paying customers: we just charged for it. People will pay for things that they think are valuable. However, pricing and the pricing "model" have been the #1 source of missed opportunities and optimization points for us (though we have fixed a lot of that), so they are really important to think about.

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