Peter Upton’s Post

Another thing I've learned after interviewing 100+ SaaS startup founders: Managed marketplaces are better than normal marketplaces. You log onto Facebook marketplace and what do you see? Hundreds of items that may be a scam lined up next to dozens of others that seem like listing from a Chinese factory. Only a few of these items are the kind of thing you actually are searching for. These days companies like Amazon are becoming increasingly difficult to navigate due to thousands of knock-off sellers with fake reviews. It's not a business killer yet but it could go that direction down the line. Airbnb has started having this problem with crazy prices on sub-par listings. My brother actually got an Airbnb in Japan that ended up being an exchange student's dorm room including her unmade bed, dirty laundry, and laptop. These problems are starting to eat into these businesses' bottom lines as people with bad experiences stop using their platforms. When I was interviewing for Bootstrappers I spoke with several founders creating marketplaces. All of them created strict standards and trainings for those they included in their marketplace from day one. Why? Because without crazy investor money fueling growth they didn't have giant marketing budgets. Instead, every single client experience counted to them as it was an opportunity for word of mouth growth. This slowed business on the front end, but now has made their businesses incredibly profitable with exponential (and free) WOM growth. I'm convinced every marketplace will either need to become stricter with management and quality control or they will eventually disappear. What do you think?

One thing interviewing 100+ Bootstrapped founders has taught me: Be wary of building tech for restaurants We all love restaurants and they are a huge part of everyday life. Many don't use much tech in their operations. It's natural to think they're a great target for disruption. But restaurant margins are normally small. They have trouble justifying extra spending. Operations can also vary substantially from restaurant to restaurant. It's very hard to create a system that works for everyone. Finally, restaurants are people businesses. They inherently need a personal touch which makes it difficult to add too much tech into the mix. I've talked to multiple founders who made bad bets on the restaurant industry and wasted months or years. If you're dead set on doing something in restaurants, find one and ask if you can help them with something (Most still need good marketing). See what they tell you. Has this been your experience? #startups #restaurants #SaaS #bootstrapped

Something I've learned from interviewing 100+ Bootstrapped founders for bootstrappers.com. When making your first startup, don't try to change the world. Try to pay your bills. Venture capital encouraged an age of ambitious thinking. We all thought we needed to make the next Facebook if we wanted to be founders. A decade later, most of these types of businesses still aren't profitable and are struggling. The businesses that are doing well generated profit nearly from day one. Many began as internal tools and automations used to help agencies do their jobs more efficiently. Making people pay for a service is the hard part. If you prioritize for that, everything else (a global vision and mission) will probably come quickly. Has that been your experience? #startups #bootstrappers #entrepreneurship

Something else I've learned from interviewing 100+ bootstrapped startup founders: Avoid selling to developers. Developers normally like to develop. A solo founder will often think they could build a similar tool if necessary. And when developers work in-house at a business, they rarely are incentivized to be more productive. Many (not all) don't see any reason to make their job easier. It will increase output expectations without equivalent pay. Does this fit your experience?

More things I've learned from interviewing 100+ bootstrapped founders. There's a huge market opening up in corporate logistics. When I say corporate logistics, I mean shipping goods internally within corporations. Now that the world is going remote, corporations still want to maintain some level of unification among their global workforce. That means they provide things like computers and other tools for doing their job. It also means things like shipping "company swag". This is a brand new paradigm and businesses are still working to discover the perfect solution. I interviewed two businesses in this budding industry Craftom and Brilliant. As remote work fluctuates, it's difficult to know where this field will turn but I think there is still room for a market leader to emerge. Read about these two startups below: https://lnkd.in/gi67AeJg https://lnkd.in/gi67AeJg

After interviewing over 100+ Bootstrapped founders I've learned this: If you're looking for industries to make a new product in, look for an unsaturated marketplace. Spoke with a lot of founders who got big when they made a Shopify app before their app store filled up. Later I met a couple of founders who created Notion templates right as Notion launched their template store. They easily got to the top of the marketplace. Trying to compete for number one spot on Google is tough. You may be better off competing for number one in another spot. Be the big fish in the small pond

Selling your first business is tough. Acquire.com not only provides a hot market to search for buyers, it also helps you negotiate for the best possible deal. You pay nothing a but a small percentage fee on your sale. As any experienced professional will tell you, these things pay for themselves. An advisor will often help you sell for more than you'd be able to alone.

More things I've learned from interviewing 100+ Bootstrapped startup founders. Go freemium or only sell paid plans? You'll find people fall on both sides of this debate. Free users tend to waste support time with unpaid requests. However, paid plans can be a hard sell to customers that are on the fence. How do some founders solve this? The founders of Removaly attract free users through a separate tool then push them to convert to their paid plans for better data: https://lnkd.in/gFGCzBBF Many founders, including the founder of Order Desk, implement a usage based model. The more you use the product, the more you pay. However, this only works with products that are easy to measure in units: https://lnkd.in/gk4eQ8A8 Sometimes, you realize founders only ever will use your product one time. Or once in a while. I spoke to one founder, Fed of GummySearch, who sells lifetime plans for this reason: https://lnkd.in/gk4eQ8A8 And remember, plans can always change. Once your application has enough reputation, maybe you don't need a free plan anymore since everyone knows what you do. Maybe you switch on lifetime subscriptions for a brief period early on to raise funds for your product and reward early adopters. Then you switch to normal subscriptions. How do you monetize? Have you found only paid or free plans work better? #payments #saas #startups

Here's something else I've heard repeatedly while interviewing 100+ Bootstrapped startup founders: Don't sell to students, students don't have money. However, I've also spoken with founders who started businesses with students as their first customers. A better distinction perhaps is that B2C isn't for students. However, marketplaces and social networks are perfect for them. Because they are strapped for cash and looking for opportunities, students are always looking to bargain, barter, or network. They also have much larger social networks while in school. They can spread the word about your product much faster. What do you think about this? Are there any cases to the contrary?