Bootstrapping Your SaaS Business
Unicorns aren’t just the things of myth – but they don’t happen by accident either. You must engage in significant planning, analysis, and discipline in the first stages of the company to help you get past the rough spots. Some of the best examples of companies that have achieved success relatively quickly have been open-source projects. Email marketing software Convertkit stalled for 18 months between $1,000 and $3,000 in monthly revenue before announcing that it now has $2.1 million in MRR. Another example is LemList, an email marketing tool that has grown from a single product to a $3.5 million MRR company.
The critical first step in building a company let alone bootstrapping a SaaS business is to develop a viable product. You must identify the core problem, research how it’s currently being solved, who’s most invested in solving it and why. Once you have a reasonable grasp of those elements you can begin to develop. You can use software tools or even hire a professional designer to create a prototype. A SaaS business requires a lot of trial and error at the start - the key to success is on solving specific problems better than your competitors so don’t skimp on this phase. Once you have a working prototype, you need to measure its effectiveness - test the product/market fit prior to launch. Ultimately, the most important factor of bootstrapping a SaaS business in 2021 is the ability to scale as a viable business. Founders must be aware of the limitations of their resources and constantly monitor cash flow. While they should not be deterred by these constraints, they must be able to survive a series of ups and downs while scaling the business.
Once your minimum viable product (MVP) is ready to be launched, you need to seriously weigh pricing and customer acquisition strategies and programs based on what you learned during the initial validation phase. You should create an initial marketing plan based on your go-to-market assumptions; what is the Ideal Customer Profile (ICP), what are the key messages to inspire them to try and ultimately buy your product over the competition, and what additional forums and media you must appear in, so they receive the messages you want them to get. You might want to recruit a few salespeople to work with your prospects to help convert them into customers or invest in digital sales and product delivery from your website – depending on the solution you’ve developed and the pricing. After the initial beta testing process, you should begin thanking your customers for their feedback and creating a customer support process.
Of course, these are the most basic steps to bootstrapping a business – your mileage will vary. But in the bootstrapping game, time more than money is your most precious asset. There’s only a finite amount of it available to you to prove your concept, build your product, attract your first customers, and provide the revenue to keep the engines running. With that in mind, keeping your product development cycles tight and short is absolutely critical for helping you reap the market opportunity in the fastest possible timeframe. Technologies like harpoon help you automate some of the most manual and costly (in both time and money) processes for deploying your product. The faster you can get your product into customers’ hands, the faster you can start getting money in the bank. And we all know that having that financial cushion early in a company’s lifecycle means the more likely you will cross the finish line a winner!