The 10 Principles of Bootstrapping, Based On 30+ Interviews With Seven & Eight Figure Software Founders
A month ago I interviewed 30+ entrepreneurs who bootstrapped software companies from nothing to seven and eight figures in revenue.
If you don’t have time to listen to 30 interviews, I wrote this post for you.
They were founders of: Basecamp, Aweber, Leadpages, Grasshopper, Visual Website Optimizer, ConvertKit, Balsamiq, Clarity.FM, Drip, WishList, Heyo, MeetEdgar, Thinkific, SamCart, Bucket.io, Smart Podcast Player, and more.
I grilled them with questions about how they got their first customers, how they scaled when it was hard, and their mindset for becoming profitable fast, so they could live on their business.
(Email me at email@example.com and I’ll send you a link to download all the interviews for free.)
After 30+ interviews, patterns started to emerge. And it hit me: Bootstrapping isn’t a mystery or a black box.
There are common principles the most successful entrepreneurs followed when they got started. You can follow them, too… if you know what they are.
If you’re bootstrapping and you want a clear path to growing as quickly as possible, this post is written for you.
1) Know Exactly What You Want And Never Deviate From It
I started Jason Fried’s interview by asking him, “We have access to more knowledge, resources and tools to build businesses today. But why are most entrepreneurs today still struggling to ‘make it’?”
His response struck me.
He said, “Most entrepreneurs don’t know what they want.”
This was the number one theme of every successful bootstrapped entrepreneur I’ve interviewed.
They know *exactly* what they want. And they don’t deviate from it.
They don’t get caught up in the Silicon Valley trends or highs. They don’t focus on vanity metrics that don’t matter.
They are principled, focused and disciplined and they don’t lose sight of what matters most.
After three years of building The Foundation (and completing a challenging period in business) my business partner and I reflected on our lessons we’ve learned.
When we came together to discuss them, we both had the same #1 lesson.
“I wish I would have been 100% clear on what I wanted and never deviated from it.”
Ask Yourself: Are you 100% crystal clear on your vision for your business (and life)?
2) Learn Art And Science Of Influence
Every entrepreneur I interviewed was a student of influence and persuasion.
Getting your first customer… Hiring that top developer and convincing him to build the first version of your product… Figuring out how to motivate customers to buy your product without ever talking to them…
At some level, everything can be tied back to your ability to influence others.
Nearly all of these entrepreneurs studying persuasion or direct response copywriting at some point in their career to understand exactly how to influence masses of people.
This can come from a variety of options like doing door to door sales. Copying sales copy by hand for a period of time. Or working under someone who’s already a great marketer/sales person.
No matter how you do it, you must find a way to master persuasion as an entrepreneur.
Ask Yourself: How skilled am I in the art of persuasion, influence and selling? How can I become even better?
3) Build Products Around Painful Problems
Clay Collins, founder of “LeadPages,” was running “The Marketing Show,” a YouTube video series where he’d break down what makes a successful landing page for marketers.
At the end of every episode, he’d give away the HTML files for that landing page template.
People kept asking him “How do I install this?”
At first he was annoyed because he was giving away so much for free and people kept wanting more.
Then he realized that people didn’t want to learn the technology. They just wanted to have a landing page live with a couple clicks.
That was the beginning of LeadPages, which has grown from that little idea to a $20M+ company in the past few years.
All because Clay focused on where people experienced pain.
If you want to find great business ideas, focus on where people experience the most pain.
Also — I think it’s important to note how many of these founders build products around the pain they were experiencing…
Laura Roeder needed an automated way to post social media updates so she built Edgar. Nathan Barry wanted a simpler solution for his email marketing so he built ConvertKit Brian Moran hated the shopping cart solutions so he built SamCart.
The list goes on and on.
Ask Yourself: What are the most painful problems you’re experiencing in your life (or business) right now?
4) Build A Product People Love To Use
“Build something people love” is obvious. Having a killer product is ‘table stakes’ now-a-days. It’s a requirement if you want to get traction.
But there’s one specific lesson around “How do you *actually* do that?”
In Dan Martell’s interview, he shared how he got 40,000 customers within 18 months for FlowTown.
He focused on solving ONE problem and doing it better than everyone else.
Because he did one thing so well, he was able to land major partnerships with companies like Mailchimp and others. The partnerships took off and the business skyrocketed.
“If you have the best product, you have a huge competitive advantage in the market because of how ideas spread online today.” — Dan Martell
The core functionality of almost every company interviewed started off by solving one simple problem that a group of people shared in common.
Ask yourself, “Have we narrowed our focus down to solving the simplest version of this problem?”
5) Validate Your Ideas By Pre-Selling The Product In Advance
His next step was to build a software product that made it even easier for his customers to segment their audiences to deliver the exact messaging they need.
He launched the software to his customers before it was ready using the “Telsa Reservation Model” for pre-selling.
When Telsa launched their cars, the pre-sold them to the public by asking that each person put $1000 down to reserve their car.
If they were first, they’d get the first car off the assembly line. If they got number 5,762, that car was theirs.
It might take 18 months before they got their car. But they had their spot reserved.
Ryan used the same model and, on launch day, his software company was generating around $600,000/year.
Pre-selling is a critical step because it validates that your product solves a problem that customers are willing to pay for.
This is essential in bootstrapping because we don’t have time, energy or money to waste. We have to know that we’re going to get an ROI on what we build.
Pre-selling helps remove a lot of risk from the beginning.
Ask Yourself: How can I pre-sell my ideas before spending time or money building them?
6) Focus On ONE Priority At A Time
If you’ve ever wondered “What is the most effective marketing channel to focus on during the startup phase?” I’ve got good news… it doesn’t really matter which channel you choose.
Entrepreneurs took many different approaches to starting their companies. Paid traffic. 1:1 sales. Content marketing. Blogging. And more.
Their rapid growth wasn’t because of the medium they chose… Their rapid growth happened because they picked ONE medium and stuck to it.
David Hauser focused 100% on paid traffic in his early days with Grasshopper.
Dan Martell used his ‘skyscraper content’ strategy to build a massive following fast.
Nathan Barry focused on 1:1 sales for almost two years.
In today’s world, we have an overwhelming amount of options to choose from for marketing.
Each week there seems to be a new fad. Content Marketing. Facebook ads. Instagram and Snapchat. Etc etc.
The truth is, the medium doesn’t matter nearly as much as you committed 100% to one path and maximizing your return on that before moving to the next one.
Ask Yourself: What ONE thing am I committed to being the best at?
7) Invest in Relationships With People Smarter Than You
Why would an entrepreneur who’s built a profitable, multi-million dollar business raise money?
Clay and Jason both raised rounds after becoming profitable.
Their answer to “Why?” surprised me…
Yes — they can take some money off the table. Yes — It allows the business to become more stable. And Yes — it gives them more cash to scale faster.
But that wasn’t the driving factor.
The driving answer?
They wanted access to smarter people to guide them.
Raising money got some of the smartest people in the world invested in their vision for the future.
If you want to compete at the highest levels, you need the best minds on your team.
Over and over entrepreneurs raved about how important their network is to their success. To have people to lean on when things are challenging. And to have guidance from people who’ve “been there and done it.”
If you haven’t been building your network or surrounding yourself with other entrepreneurs, now is the time.
Ask Yourself: “Who do I need to surround myself by to reach the next level?”
8) Go “All In” And Commit Fully
Four years ago, Carl Mattiola was working at Tesla Motors. He had tried some business ideas over the years, but nothing took off.
In his 30’s, he decided, “It’s now or never” and he joined The Foundation, our six month accelerator for bootstrapping entrepreneurs.
His mindset going in was, “This is going to work or I’m going to give up on being an entrepreneur.”
Six months later, he built is first software company that was generating $4,000/month in revenue and he quit his job at Tesla.
Four years later, he’s running a multi-million dollar company.
All because he went ‘all-in’ and committed fully.
This was a common trend among entrepreneurs.
Often they’d find themselves in positions where their back was against a wall. Or, if that weren’t the case, they’d create a situation where they had to.
Nathan went all in. And that was the critical moment that shifted everything for him.
Ask Yourself: “How committed am I to this vision?”
(If this answer isn’t a resounding “100%,” consider pursuing something else.)
9) Start Before You’re Ready
Fed up with paying too much tuition for classes that weren’t teaching, ‘real world experience,’ Chandler Bolt, another Foundation student, dropped out of college.
He was 20 years old.
Fast forward a few months later and he got a massive wake up call when he was broke and almost wasn’t qualified to rent an apartment.
That was when he had to figure life out.
Two years later, he built a seven figure business.
All of his friends were graduating and having their own wake up calls about life, figuring out where to work and who would hire them.
Chandler just did it two years earlier and gets to reap the rewards for it.
This was a common theme.
Bootstrapped entrepreneurs are consistently doing things they are unqualified to do because they started before they were ready.
This becomes the theme of their life, always optimizing for speed and learning to grow as quickly as possible.
Ask yourself, “What am I doing that I’m not qualified to do?”
If you don’t have an answer, it’s time to try some new things.
10) Be Willing To Pivot In Any Moment To Serve Your Customers
Chris Brisson spent a year building out a software that few people actually ended up using.
Feeling the frustrating of banging his head against a wall for so long, he tested a completely new idea that was more in alignment with what people were frustrated with.
People loved it.
Within a week, he dropped the old idea completely and shifted to focus on this new business.
Within two weeks, he had a few dozen customers who paid him a couple thousand dollars because he pre-sold the idea.
He made more progress in a month than he had in the whole previous year.
All because he was willing to pivot quickly to serve his customers.
Ask Yourself: “What isn’t working right now and what would I have to change to better serve my customers?”
The Unique Ability of Bootstrapped Entrepreneurs And The Paradox We Live In
One of the unique abilities of bootstrapped entrepreneurs is their ability to hold paradox.
Meaning, they have the ability to be “all-in and committed to their vision” and, at the same time, willing to pivot in any moment.
They’re clear on exactly what they want and they focus on one thing at a time… and yet, they’re willing to give it all up to more deeply serve their customers.
This is what makes entrepreneurship such an amazing game.
There are no ‘hard and fast rules.’ There is no ‘one way’ that works. There are not black and white plans.
Any path can work.
These 10 Principles are not rules. They are guidelines to keep you focused on your path.
Use them as a reference point anytime you feel stuck or lost and they’ll help you get back on track with what matters most.
With love, Andy Drish
PS — If you want all the interviews from this Summit, email me (firstname.lastname@example.org) and I’ll send you a private link to watch them all… for free.