Winston Churchill famously said the following after losing power following World War 2:
After six long years of bootstrapping, I feel much the same way. Bootstrapping sucks. It’s freaking hard, at least the way I did it, and it’s full of low-points that require you to learn important lessons the hard way.
The hardest thing I’ve had to learn is how to be the CEO. Six years ago I didn’t know Jack about running a business. In 2008 I literally believed that if I built a web-app for managing Boy Scout Troops I would sell 10,000 subscriptions immediately and be rich overnight.
It took four years to get 100 subscriptions. Four long years of working a real job with real demands, then working another 20-40 hours on nights and weekends. For FOUR YEARS. Do the math on the return on that investment real quick. Actually, don’t. It’s too depressing. 100 subscriptions is only about $9000 in revenue. There’s no way that’s a good investment.
That’s the first thing that sucks about bootstrapping:
Every bootstrapper has a moment where they realize that this is going to be hard, and lots and lots of bootstrappers don’t make it past that moment.
I remember that moment explicitly. I was sitting in a Qdoba in Indiana in August 2009 talking with some guys about TroopTrack and I suddenly realized the truth. This was an endurance race, and it was a race no one has to finish and no one ever wins. You only lose. All you have to do is stop running and you lose. But there’s no finish line. IT NEVER FREAKING ENDS.
It’s easy to see how that could be a depressing moment. I almost threw in the towel. My product was crap. My business wasn’t growing. My partners were hostile and wanting out. My day job was pushing me hard. My wife was sick and I had gained a crap-ton of weight.
Shannon wouldn’t let me quit, and she helped me see a simple truth:
All we have to do is never quit
That subtle viewpoint shift was important. Instead of seeing bootstrapping as an endless race that I could never “win”, I learned a simple truth: I didn’t need to win. All I had to do was never quit.
Here’s the next thing that sucks about bootstrapping a web-based business:
The Toobs NEVER Sleep
People use TroopTrack at all hours of the day, 7 days a week, 365 days a year. And they have problems. And questions. And feature requests. They expect me to help them, to answer their questions, to fix bugs, and to add the features they ask for. I have customers who, if I don’t respond to a help desk ticket within an hour on a Sunday afternoon, will post their question to my Facebook page, send me an email, and call my cell phone.
Okay, I’m exaggerating a little, but it sometimes feels that way.
TroopTrack has been growing 250% per year since 2009. That’s not a big deal when you start with 2, at least for the first four years. For a long time I was able to keep up with everything and excellent customer service became the cornerstone of our reputation.
Then I broke my body. Well, at least that’s how it felt. I slipped a disk. It was horrible. I could barely walk, even with a cane. I couldn’t even sit up to work, and laying on my back to code was only marginally workable because of the leg spasms that attacked me every few minutes. I was barely able to keep my day-job commitments, much less my TroopTrack commitments. It was months before I was healthy enough to do my day job well and to work on TroopTrack.
In the meantime, TroopTrack hadn’t stopped growing and the requests for help kept coming in. I started to get emails asking if I was still in business. Long time customers called me to see if I was still alive. I had no choice but to tell them the truth and beg for patience. It was humiliating and, sadly, not the last time it would happen.
It happened again last year, when my sister-in-law and her family moved into our home for the final stages of her battle with cancer.
During that time TroopTrack was growing more than ever, and the help desk tickets weren’t slowing down. We went from handling it to completely failing at customer support overnight. By the time the family crisis was over we had 1700 open help desk tickets.
Here’s the third thing that really sucks about bootstrapping, and the last one I’m gonna mention today:
Your family will hate it
Bootstrapping a business is like having a mistress, but without the extramarital sex or intrigue. Or, at least I think it is. I’m not that kind of guy. At any rate, it certainly comes with the guilt and jealousy that I imagine cheaters feel.
Shannon used to describe TroopTrack as the other woman. She was committed to it, she believed in it, and when I wanted to give up she was the rock that kept me going, but she also resented it, and so did my kids. Frankly, so did I. I didn’t want to work all the time. I managed to survive that way for the first five years, but by 2013 I was burned out. I wanted to play. I wanted to go to the movies without worrying about the ****ed distribution list server falling over. That thing goes down and I get irate people within an hour. I hate email. I wanted to go on vacation and not think about TroopTrack for two weeks a year.
All of this was completely impossible, and the guilt was horrible.
Dad, you never play with me anymore.
Jake, age 5
Boom. Cold knife in the heart.
All My Problems Were Solvable
I already talked about solving the first problem (Reality sucks), but the other two problems had one solution: Hire Shannon.
She was looking for a way to earn some money on the side and was talking about getting a part-time job and one day the obvious hit me hard enough for me to recognize it. So I hired Shannon to be the COO. I paid her crap (and frankly still do!) and asked her to get the help desk under control. She was happy to get the money and to have the freedom of a job she can do from home on her own schedule (the toobs never sleep!).
The best part of all is that TroopTrack stopped being the other woman. SHARING MY TROOPTRACK TROUBLES WITH MY SPOUSE WAS THE BEST BUSINESS DECISION I EVER MADE. Almost overnight this:
The whole family is sitting around watching a movie and you have to be on your laptop the whole time!?!?
You’ve seen this movie before and there are five help desk tickets I need your help with, hint hint.
Shannon, TroopTrack COO
I can’t tell you just how awesome and gratifying it is to have Shannon engaged in our business. Talking about TroopTrack used to be boring to her. She would listen, but not really engage, and the subject would get changed at the first opportunity. Not anymore. Now she schedules business lunches with me. She is in the details of the business. She’s excited about where it’s going, and she’s making it better.
This is a big freaking deal Mr. Bootstrapper.
Everything Else Sucks More
Sure, the last six years have been hard. But look at this:
You’ll have to click it if you want to be able to read it.
That’s pretty awesome, IMO. Sure, it took six years to do it, but I have enough subscribers now that I could live completely off TroopTrack. And the growth curve is promising – if we don’t stop running and keep solving problems as we encounter them, we will someday have 10,000 subscriptions. And hey, that’s a crap-ton of money.
But what does this have to do with everything else sucking?
It’s simple. I want you to understand what I currently have because I bootstrapped. That chart is MINE (and Shannon’s). We own TroopTrack outright. Even if TroopTrack leveled off today and stayed level, we would still have the financial equivalent of a winning lottery ticket that pays out $100k every single year.
At this very moment we are a financially independent family. We can’t be fired, laid off, downsized, whatever. We control our own destiny.
So let’s talk about what the other options would have given us and whether or not I would have avoided the three things that suck most about bootstrapping.
First of all, VCs expect you to work like a bootstrapper. So, right off the bat, I would still have the problems associated with working all the time, but with a nasty new twist: if I became temporarily incapacitated because of health or crisis they would leverage that to take more of the company away from me.
There are all sorts of unhealthy dynamics associated with venture capitalism that are well documented elsewhere, so I’ll skip those. Worst of all, I wouldn’t be able to chart my own course. I’d have to deal with VCs and their opinions. No thanks.
Secondly, having VC money doesn’t make the transition from fantasy to reality any easier. In fact, the presence of other people’s money can postpone that transition, all the way up to the day you shut down. When you still have a pile of cash you don’t have to face the facts.
Finally, the toobs still never sleep. If I had piles of money I could have just hired people to worry about the customers. That detachment early in a product company from the customer is not good. That’s how you learn – talking with customers is a critical part of my learning experience. Sure, there are ways you can structure support so that you aren’t totally detached from it, but doing so would have brought other troubles and problems to solve that I didnt’ have to go through as a bootstrapper.
So what if I had taken VC money to start TroopTrack, where would I be?
Out of business. I guarantee it. There have been numerous attempts to do this and every single one ended the same way. Dead. And I think I understand why.
It’s because this market is a slow mover. It doesn’t matter how awesome your product is – it takes years to get this market to change. The purchase cycle of scouting software is at least a month, and the effort for a scouting unit to switch from one package to another is huge. Even if the technology makes switching easy, the social costs of switching are super high. First you have to convince the committee. Then you have to win over the parents. It’s hard. People don’t want to go through it unless they have to, and they don’t want to mess around with software that might not be around tomorrow. They take the process very seriously – we frequently get emails from customers that read like a million dollar RFP. For a $99 product.
There’s no VC in the world that has the patience for that. Even with a million dollars it would have taken six years to get 1000 subscriptions.
The Other Option
The other option I want to discuss is doing nothing. Sure, I would have had an easier six years, probably. I might still be at Liberty Mutual, slogging away at putting a percentage of my blood sweat and tears into a 401k that might someday be able to pay out $100k a year when I am old.
The One Thing I would Change
This year we made a big change in the way we bootstrap. I quit my job and started consulting. I landed enough contract work to also hire Ryan Bell. We structured our contracts so that Ryan only has to consult for 30 hours each week and he has time to work on TroopTrack. I still work a lot, but not as much as in the past.
I wish I’d done this sooner. I don’t think I could have made it work prior to 2011 or so because I still had a crap-ton of things to learn about Ruby on Rails development (I was a project manager who hadn’t programmed in years when I started TroopTrack). It’s really hard to hold down a real programming job and launch a product company on the side.
So, if you can, start a consulting company along with your bootstrapped product company. Then structure your contracts so you can live off of 20 – 30 hours per week of consulting. Working as hard as I have done sucks big time and I don’t recommend it.
Everyone Should Bootstrap
I’m so glad I built TroopTrack this way. It feels great to still have complete control of the product when it finally starts to get traction. It’s been super hard and I have had to think long and hard about the answer to THE question:
If you knew in 2008 what you know now, would you still launch TroopTrack as a bootstrapped company?
Everyone I Know
Heck yeah I would. And you should too.
If you want to start a business, bootstrap it. If you want to start a business that can’t be bootstrapped, START A DIFFERENT BUSINESS. It took me four years of evaluating different business ideas before I settled on mine. If you can’t bootstrap your idea, toss it until you find one you can. There are tons of market gaps out there that can be invaded by small businesses. If you look long enough you will find one that is right for you.
PS. This may sound gratuitous, but I don’t care. TroopTrack was inspired by the success of 37Signals and is an outright attempt to emulate and imitate them. Even though I’ve never met a single one of them, I owe them my thanks. So here it is: Thanks a Crap Ton. I love you guys.
PPS. Also, thanks to you Shannon and my kids. I love you more than TroopTrack.
PPPS. I’d be screwed without @kofno. Thanks man.
Other Bootstrapping Posts
Here are a few of the hard lessons I’ve learned over the years: