SFN221: Bootstrapping a business with a full-time job and a family to feed
Starting a business is hard.
It's even harder when you have a full time job AND a family to feed. Balancing all of those priorities can be a challenge.
But it’s possible...
Dean and Eliot were facing that exact challenge and they were able to grow TitleTap from nothing into hundreds of customers in a few years.
This is their story, full of successes, failures and lessons along the way…
Dean (left) and Eliot (right)
If you’ve ever felt like you don’t have enough hours in the day to start a company, this story is written for you.
We were 11 months into building our software product (7 months late), on our third developer and only a single customer. Not only did we burn through the development funds, and had only a half baked product to show for it. It seemed like everything that could have gone wrong did.
You see, we had built products in the past but none seemed to stick. Either the the timing was wrong, or the market was bad, or the prospect liked it but it wasn't solving a big enough pain for them to pay for it - all excuses.
This time was different.
Instead of building and hoping, we pre-sold a solution for a niche market but this time we were having trouble delivering it.
It’s an entrepreneur's worst nightmare. (Not to mention we were working full time in our corporate jobs to pay the bills.)
Catchphrases like "pivoting" your product was all the rage during that time, and we were just getting ready to pivot again.
Our plan was to refund the money and move on to a different product and market. Dean was onboard until suddenly he wasn’t.
I remember my business partner Dean telling me that we were not going to pivot again and that we were going to see this one through.
"Let's get the remaining funds to deliver this product and then see what happens. We are going to make this work," Dean said to me one evening in November 2013.
So we each put in a little more money and found a new developer to finish version 1.
We took a calculated risk, got focused, finished the product the next month, got it to the customer, and continued to try to sell the product the following year to other customers.
TitleTap’s Original Product Left vs. Current Version: A mobile app calculator for real estate agents
Although that following year wasn't a cakewalk either (which I’ll tell you about in a moment), the risk paid off.
5 years later we now have hundreds of customers, a team of 12, are approaching 7 figures in revenue.
MRR Growth Chart (Red=Churn; Orange=Downgrade; Blue=Existing; Green=New
These are the 7 major lessons we’ve learned from going from failing entrepreneurs, bouncing from idea to idea, to building a million dollar business on the side.
How Did 2 Regular Guys Working Demanding Day Jobs Build A 7 figure Business With No Investor Help (While Still Supporting Their Families)?
The short answer is: very slowly and deliberately; we figured out a formula that worked - balancing customer wants and needs with price and costs.
Because we were both the sole breadwinners for our families, it was several years of working after the kids went to bed until midnight. Then getting up at 5 or 6 am to get an hour or two in before going to work.
In addition, it was often using lunch breaks to call customers or reply to support tickets.
Having a consistent cadence where we’d get our most important tasks done each day really helped. We had to be very organized and deliberate with our time.
Lesson 1: Get your most important task done first every day.
Average day early on...
Juggling a spouse and kids was also a challenge. We had to set our own boundaries and reserve time on our calendars as a reminder that it was time to unplug.
For example, Wednesday and Friday nights were set aside for me and my wife to spend some quality time together. And weekends were mostly off limits until later Sunday night, when I would go back to the grind.
Dean’s scenario was similar.
It wasn’t easy to juggle this but that was the type of commitment that was required at that stage in our lives.
The First 18 Months: The Grind
As I mentioned earlier, during year 1 we only had a single customer and didn’t deliver any product until the 12th month due to numerous setbacks.
Our first developer wasn’t as skilled as he said and couldn’t deliver. Not seeing the train coming until it was too late, we ended up wasting half of our budget on him.
Our second developer disappeared - poof.
Our third developer finished 70% of the project in just over a month after we made the decision to continue with our own money. That was the good news.
The bad news was that the second year was just as difficult as the first but for different reasons.
It can be a dark, daunting feeling to be 18 months into a project with only one paying customer and half of a product.
Our confidence was low. And doubt consumed us. But we kept moving forward… Thankfully.
12-24 Months: The Epiphany
Even though we delivered the product to customer zero, we were having a tough time selling the same solution to other customers like our first customer.
We had a ton of interest from cold prospects we’d reach out to using derivatives of the “Strange Question” email we learned about in The Foundation.
Here is an example of the email we would send out and a typical response we would receive from a prospect.
Cold Email Example From the Early Days:
Cold Email Response Filled With Gold:
After listening to customer feedback we soon realized our product was far too costly for our market. However, if we lowered the price we wouldn’t make money due to the costs involved to deliver.
Realizing that we needed to change from a native app to a mobile web app, we decided to pre-sell again.
We calculated the estimated costs to build it out and came up with a pre-sale offer so we could afford to re-build our software with a web format instead of native iOS or Android. Then we went back through our prospect list and gave them a new offer.
By this time some folks had already moved on but we did get enough purchases to rebuild the product on the new platform.
At this point we had a whopping 3 customers. Hooray!
But customer 1 was on the fritz of canceling due to the time to deliver the product (about 18 months at this point).
So we kept grinding and refining the offer until one day we noticed a trend in the feedback prospects were giving us as to why they purchased or why they did not.
It is important to note, around this time we had connected with a group formed by prior Foundation grads called Beyond 13 or “B13”.
Beyond 13 Meetup in Florida
They had reached out to invite Dean and I to a weekend in Palm Coast, FL to meet other aspiring entrepreneurs who attended the Foundation and were at varying stages of growth. Since the meeting that year was fairly local we thought it was a great opportunity to network and see how others were coming along.
The experience ended up being more pivotal than we ever could have imagined.
We met some amazing people and got to learn great lessons from others. However, up to that weekend, Dean and I had not really carved out any opportunities to have meetings that weren’t interrupted by kids, random calls, customers, the dog, etc.
This one weekend with B13 opened that door.
I can remember clearly the night we finished a great group session, came back to our room with a whiteboard and literally spent the next several hours outlining priorities and focus. We wrapped up feeling more confident than ever of our next steps. That one meeting cleared our path of what we needed to take action on the remainder of the year.
It also set a new precedent that we still carry on today…in person whiteboard meetings where focus is by design uninterrupted and priorities along with actions and deadlines are set.
We do this every quarter now and it is a great way to stay accountable, evaluate progress and work through roadblocks.
Lesson 2: Mentally Prepare For A Marathon With Small Sprints In Between
18 Months: The Game Changer
Prospects were really liking our solution as much as they did on the native iOS product. We were no longer hearing that it was too expensive - this was good.
But we weren’t getting as many to purchase as we had expected. We had maybe 4 or 5 customers around this time.
However, the prospects that were buying our product had just completed a website redesign and a vast majority of the prospects that didn’t purchase said that they needed a website redesign first.
Then the lightbulb went off.
What if we offered a web redesign with the product?
Over the next 2 months we tested and refined this offering with a couple of customers and prospects.
Immediately we pre-sold 2 prospects with our new offering.
Those 2 sales were far easier than any of the sales over the previous 20 months. This validated our market and solution, and allowed us to systemize the delivery of the solution.
Previously our solution was pure SaaS, but now it was SaaS with a Productized Service.
Fast forward 6 weeks and both of the customers were thrilled with their new websites and our SaaS product built into their website.
Lesson 3: Listen To Not Only What Your Customers Are Saying but What They Actually Mean
24 Months: The Infamous Webinar
At this point we felt we had an offering that would convert and a database of a few hundred cold prospects. How could we get it out there to start getting more sales pretty quickly?
Individually prospecting took a ton of time and both of us had pretty busy work schedules with our day gigs at that time. Also, our wives were starting to wonder what we were wasting our time on.
Our answer….a webinar where we would give the top 7 things that every website needed to drive more business.
We spent the month of October of 2014 getting 10 unique web designs built, writing the webinar, and refining our webinar offering.
- We invited 200 cold prospects to our webinar
- 18 RSVP’d
- 13 showed up to the webinar and 7 customers converted with a purchase after the webinar.
Lesson 4: Wow Them With What They Want But Give Them What They Need
25-48 Months: Focus On Your Customers
Much of the next 48 months was spent growing our customer base, adding features to our solution, and supporting our existing customers part-time while we worked our day jobs and continued to support our families.
Our next hurdle was differentiating ourselves from a general marketing agency.
We soon added an email marketing and video library suite complete with content for our market, in addition to the website and calculator product that we already had.
The idea was that we’d be a single source, turn-key solution specifically tuned for the industry.
During this time of our growth, our partnership was very important. Dean had a software sales job so he had time flexibility to do product demos and handle sales request. At the time I was working for a software company which was mostly nights and weekends systemizing and project managing development.
In hindsight, Dean and I have a lot in common from a family perspective in trying to maintain a balance. We both have 2 kids, a wife, as well as similar values and reasons for doing what we do.
We also have complementary, overlapping skill sets. Dean is good at sales, finance, and business development. Whereas, I am good at project management, processes, and marketing. Each of us can still hold our own on the others’ roles but would rather not.
This was critical for us in working with each other. For example, say one of us was single with no kids, one might think the other isn’t working hard enough, or not understand why the other one has to cancel a meeting due to a child being sick.
Lesson 5: When Looking For A Partner, Try To find Someone With The Same Core Values As You But With Opposite Skill Sets
Why We Outsourced Development Even Though One Founder Is A Developer
Even though I was a software developer by training, one critical decision we made early on is to outsource the development. My time was better spent on high level stuff and I could get more done if other people were in the weeds, especially since I was not working on the business full-time.
Had I been doing the development and website builds, we might have missed other opportunities, such as the idea to productize our website platform.
Lesson 6: Delegate As Much As Possible (Outside of Sales) From The Start, Even If You Don’t Have To
48-60 Months: Wrestling With Limiting Beliefs & Quitting Our Day Jobs
Dean and I both quit our day jobs during this time but not at the same time.
With the amount of work we were getting we didn’t need more time for sales, we needed to improve our processes, product, marketing, and to provide customer service.
I quit first since our needs at that time were more in my domain. It was scary as hell. I had just got promoted at my day job and the business wasn't quite making enough to pay me what I was making at my day job. Plus the new health laws now required me to purchase health insurance for my family of 4 in addition to taking a pay cut.
However, the business needed me to be full-time and smooth out operations so we could continue to grow at pace. It was a risk to quit a “safe” and flexible job with health insurance. But was not only necessary for growth but also just to continue providing awesome service to existing customers.
There is nothing like building a bridge as you are walking across it, but the calculated risk paid off. The year that Eliot quit, we grew the business by 300%. This enabled Dean to quit 9 or 10 months later - far from the overnight successes you read about in the media but well worth the grind.
Dean went full time January of 2017 which enabled more time for demos and sales calls to capitalize on our marketing efforts at a higher level.
So far we have been able to hit record sales for Q1 and are on track to do the same in Q2.
Currently we support hundreds of customers (including 7 of our original 10 customers), we are on version 4 of our original product, launched a new product last year, and are launching 2 new products this year - all pre-sold using the skills we learned in The Foundation.
Even though we have had a good run, we are still not where we want to be. We will continue to grow the business and provide our customers with great product, value and service.
We make an effort to get on calls with existing customers to check in with them, get their pulse, and solicit any feedback that might help us improve the products or customer experience.
Lesson 7: Define and Remember Your Why
With all things in life it is important to remember your why. For us our “why” was to be independent of the demands of a traditional 9-5 and to own our time. We used that in the early days for motivation when things got tough.
Now, we use that same “why” in making decisions and to regulate ourselves from overworking as it can be easy to fall back into the habits that we’ve been conditioned with over the years.