What's your end game? When will you stop growing your bootstrapped business?

Discussions
#1

Have you ever thought about what comes after growing your bootstrapped business? What happens after 1M ARR, 10M ARR, or even 100M ARR? Is your goal to become a unicorn? Sell? IPO? :unicorn:

We’ve asked ourselves this question a lot over the past months, and have decided to slow down and stop growing for the wrong reasons. It’s just not sustainable. Not for your team, not for your customers, and not for yourself as the founder.

I wrote down our ideas in this article here :point_right:https://plan.io/blog/post-growth-entrepreneurship/

Would love to hear some feedback from other Bootstrappers. Thanks! :pray:

P.S.: Here’s an infographic from the article we made about bootstrapping vs. VC. Feel free to use it.

bootstrapping-vs-venture-capital
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#2

If I manage to turn my new service into MRR then I would NEVER stop !

#4

I had similar thoughts recently. While growth is still a key target for me (it’s still a small business), I realized that growth is not the only goal, nor will it be forever my #1 goal. Once you reach a certain level of sustainable income, do you really have to make growth your primary goal?

However, I am not sure about this sentence from the article: “Customers want to buy from sustainable and transparent companies”. A lot of sales is done by posturing and faking, and customers often expect that. It’s just “how it is done”. I had some discussions with customers where their questions indicated that they would rather buy from “an established, larger company” than from a smaller sustainable business. They did warm up to the idea after a while, but it took some explaining and convincing. I think most people do not realize that being a customer of a VC-funded company is generally never a good thing. The only outcome in a VC-funded business that is good for the customer is an IPO, which rarely happens. With all other outcomes (money runs out, business gets acquired), customers lose. I wish more people realized that.

#5

I believe that we should consider our income and monthly costs and competitors when talking about desired growth.

  • If your monthly costs to run your business is X, and your income is in the range from 0 to 1.5*X then you must heavily invest in your company growth. Because it is risky to not be ready for 30%-50% sales decline. The previous Coronavirus year showed that perfectly.
  • if your income is more than 2X or 3X or more then you should invest some of that money back into your business.
  • if your competitors are making the similar money or worse 2X or more then you have to invest heavily in marketing. Else they will push you out of the business.
  • if your competitors are growing 50-100% per year and your company growth is smaller then all you should thinking is growth or you betraying your employees, who deserve stability in their life.
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#6

Very good points! I would perhaps disagree with this one, though:

That’s assuming you have employees :slight_smile: But even if you do — perhaps they are also looking for stability? Do they really need the company to grow wildly?

These are difficult questions to consider, but I think the main point is that it should not be obvious that Growth by itself is always a primary goal.

#7

How fast private competitors are growing can be very very hard to determine. Be careful of reading anonymous case studies and blog posts that are highlight reels without substantiation. If you find yourself losing business to a competitor, for example a current customer tells you they are switching and stops paying for your service, or a prospect tells you evaluated your service and are choosing another one for some specific reason(s) that’s definitely worth acting on.

#8

This has definitely been on my mind lately. Jon and I were just discussing this as it relates to Transistor:

I think we’re realizing we want to optimize for:

  • Personal freedom and flexibility for us as founders
  • Having less stuff on our calendars (as opposed to more meetings)
  • Having enough money that we can live the lifestyle we want

:point_up: We’re basically there already. So now, we’re looking to write out our values and think about what new things we want to pursue.

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