Bridget Harris – Bootstrapping for Badasses – MicroConf 2017

👈 Back to all MicroConf 2017 talks

Free eBook of every Starter and Growth talk

We’re sending out a beautiful PDF eBook of notes from every MicroConf 2017 Starter and Growth talk – both Speaker and Attendee. Want a copy?

  • Bridget Harris – @bridgettoday
    YouCanBook.me – online scheduling

    • Came in in 2012 to start running the company
    • Bootstrapped
    • Growing fast
    • Interesting infrastructure challenges from fast growth
    • “Bootstrapped”, or “Revenue-funded”
  • Want to tell you how we bootstrapped
    • Thousands of people sign up and use for free – all the challenges that come with that
    • How do we bootstrap a freemium model?
    • How do you bootstrap like a badass?
      • 1) How to think more like Solon
      • 2) How to be more like the shoemaker
      • 3) How to be more like the Wizard (of Oz)
  • 1) Bootstrap like Solon
    • King asked him “who’s the happiest person you know?” expecting it to be him
      • But Solon replied “Probably Tellus the Athenian”
      • King: “But who after that?”
      • Solon: “Probably Cleobis and Bito”
      • King: ???!
      • Solon: “You can’t judge happiness until someone dies. Until you know what they were all about.“
    • This idea that you’ve got to think about the big picture, but also about the journey
    • In our companies, there’s a lot of the quickfire “convert/sell/funnels!” / short term, without looking at the big picture
    • Lots of entrepreneurs – “I wanna have the fancy office”
    • What did we do in practical terms?
      • Been building products since 2003
      • YouCanBook.me got to a stage that we could run it full time, so we did
      • “I’m going to run a software company”
        • Because if I don’t commit to that idea, it won’t happen
      • We stopped building other products
        • We had lots
        • Make a logo, release another product
        • Couldn’t sustain it
      • Started BUILDING A BUSINESS, YCBM was making money
        • We’re going to tell ourselves “this is the product we want to make work”
      • Stopped hiring friends, started hiring colleagues
        • We do still have people who started out as friends
        • But it’s not the best way. What if you need to fire them?
        • Good indicator that you’ve professionalized
      • “Get off the cross, honey. Somebody else needs the wood.” (Dolly Parton)
        • Started to resent that we weren’t taking a financial return from the business, because we were reinvesting it all / spending it on hires
        • You own the company, you want financial freedom, the company needs to pay back to you personally as well as everyone else
      • Building a business — you’ve got to make money
        • Neither of us were used to this idea of making profit being OK. But it’s completely acceptable. We need to be unapologetic about it. Businesses are supposed to make money
    • Being like Solon means commit to the long term.
      • After all, you’ve got nothing to lose
      • Regardless of what you want to do with the company long term. Whether you want to exit quickly or not, neither should stop you building sustainable systems
  • 2) Bootstrap like the shoemaker
    • The difference between revenue and profit
      • We had to learn this. The money in your bank feels like you can spend it on anything
      • There’s much more to this than “this is how much money is in the bank account”
      • Income; costs.
    • We had to learn the boring financial lessons from classes and courses
    • Maximize cash upfront
      • YCBM: minimum you could buy was six months
      • Was one of the main ways we were able to bootstrap — we were funded by ourselves from the future
    • Changed and simplified pricing
      • Used to have Free → Premium → Professional, the standard packages UI
      • Put way too many features in the free tool. As soon as we moved the new ones to paid, people started paying
      • Changed it to 1 user, 1 calendar, $10/month. Simple.
      • Stopped having to explain why each feature was in which plan.
      • Much simpler. Everyone happier
    • Watertight systems/integrations for dealing with finances, bookkeeping, etc
      • Now implementing KillBill (open source billing)
      • Everything automated
    • Managing expectations
      • Hiring is different if candidates are used to VC-funded companies
      • People know we don’t have an endless supply of cash
      • But we’re not selling based on future promises. The “jam” we have today is ours to use
      • Everyone internally knows all the numbers
    • Borrow
      • As well as cash upfront, we’ve also borrowed
      • Tricky with banks —
        • “Sorry, we don’t lend to loss-making companies”
        • “We can’t fund risky business speculation”
        • “We don’t fund directors’ salaries”
        • So we adjust the numbers… now it’s “If you’re making a profit how can we know you’ll use the facility? What’s in it for us?”
        • “This is unusual. Have you thought about taking VC?”
    • Profit / Loss
      • Early days, roughly breaking even
      • Need to invest in the long term
        • Hired. → Resulted in big losses
        • Hired more. → At some point it reverses, becomes profitable, profit continues to increase dramatically
    • Being like the shoemaker means spend less, make more money
    • Grow more slowly, but grow more profitably and sustainably
    • VC is not income, or revenue, it’s more debt
      • Ironic that we’re in Las Vegas — businesses don’t like genuine gambles. Grow slowly and systematically
  • Bootstrap like the Wizard of Oz
    • Your users, following the yellow brick road, to reach your promised startup, to solve their problems
    • When you first start, people are turning up at your door
      • Like the Wizard, you feel like a fraud. You’re not ready for them yet. Hiding behind the curtain
    • Traditional sales model — brag and brag, tell everybody how great you are, that you can solve all their problems
      • One of the lessons we’ve learnt: bragging isn’t selling. It’s stressful pretending to be something you’re not
      • What we did instead:
        • On our web site: we’re honest. “Even though the product has grown over the years, we’re still a small and dedicated team who love solving scheduling problems all over the world. We’re proud to remain a privately owned company – solvent, stable and a safe pair of hands.”
        • We don’t pretend to be anything other than what we are
          • Truthful
          • Authentic
          • Only ten of us, but we have some very big clients. Sometimes have to say
            • “We’re just a small team”
            • “We haven’t done this before”
            • We’re relying on our reputation for reliability, credibility and authenticity seeing us through
        • Early impression: we should spend lots on consultants. But it was a waste. Started profiting when we stopped spending on stuff that wasn’t giving us any ROI but was rather just making us “look good”
      • We used to have a blog.
        • “6 Smart Ways to Make Social Media Marketing Work for your Small Business”
          • What are we doing??
          • Why are we pretending? We don’t even know how to do social media ourselves
          • We were writing shit on the internet
          • Let’s just cancel the blog. So we did.
      • We used to have a Facebook page
        • But why?
        • Wasn’t doing anything for our business
        • Posting shit content because we thought that’s what you’re “meant to do”
        • So deleted it
    • Community
    • Be as big as you want to be
      • Be true
      • Be authentic
      • Be yourself
      • If you’re trying to be someone you think everyone wants, who are you?
  • Be like Solon: be in it to win it
  • Be like the shoemaker: make what you can afford to make
  • Be like the Wizard: be authentic
  • Q&A:
    • “You briefly mentioned profit sharing amongst the team. Can you talk a bit about that?”
      • Haven’t started much yet.
        Balsamiq are doing it, want to follow their model
        Unanswered questions: asymmetry in cost of living;
        There are people who have been on the team for a long time, have invested in us, we want to reward them.
        Don’t know the exact numbers. Look up Balsamiq, they write a lot about how they do it. It’ll be something that makes everyone happy
    • “What marketing do you do if you’ve shut down FB; blog?”
      • Very little. A lot of word of mouth. The “Powered by” button. Organic search has ramped up a lot over time.
        Now that we have a sustainable business, solved a lot of tech debt, marketing may start to ramp up more in the coming years.
  • END. Thanks Bridget!!

👈 Back to all MicroConf 2017 talks