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Bootstrapping Profits - Valiocon 2013

Bootstrapping Profits - Valiocon 2013

A story about bootstrapping BuySellAds.

Todd Garland

June 06, 2013

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  1. The first spreadsheet I built to validate the money side

    of BuySellAds What? OK... Amazon Web Services S3 Whoops... not gonna scale forever, $140,000... Thursday, June 6, 13
  2. Trying to figure out which payment processor to go with

    Sometimes a random number can become reality Thursday, June 6, 13
  3. February 2007 Came up with idea September 2007 Finished Version

    1 Started at HubSpot Full-time February 2008 Launched BuySellAds January 2009 BSA full-time 2 years, concept to real working product, replacing my full-time salary (with a 6 month hiatus) Thursday, June 6, 13
  4. Making the jump from nights & weekends to real business

    Time to quit full-time job worst case best case Thursday, June 6, 13
  5. Business Structure ...or lack thereof Risky? YEP. But I don’t

    have any money, so who cares? Sue me... Setup Cost = $0 Todd Garland (doing business as) BuySellAds Thursday, June 6, 13
  6. If you want the “nitty gritty” Starting + Sustaining by

    Garrett Dimon http://startingandsustaining.com/ buy this book ($99) Thursday, June 6, 13
  7. Sorry... I’m not going to plug Drew & Josh’s book

    I assume you all already have it... Thursday, June 6, 13
  8. Hi David, I noticed you have a bunch of sponsors

    in the sidebar. I’d love to help make it easier for you to manage those, and also bring you some new advertisers. We’re still in private beta, but the product is solid, and working really well for logopond.com, csselite.com, and 13styles.com. I’d love to add you to the list. If you’re interested to see what inside, here’s an invitation code: http://buysellads.com/register/?invite=HKSius98S98 If you have questions or if there is anything I can do to help, please let me know. Cheers, Todd Thursday, June 6, 13
  9. Didn’t waste time building features that could be easily faked.

    Stayed in “private beta” for over a year, using the fake invite system. (I’m not sure this works very well today...) We were responsive. (everyone is these days, and now you have to be UBER-responsive) Thursday, June 6, 13
  10. Original email thread I sent to who is now BuySellAds’

    co-founder @nathandev Thursday, June 6, 13
  11. If you are not a developer, how do you...? If

    you’re not an accountant, how do you...? If you’re not a sales person, how do you...? If you’re not a good manager, how do you...? If you don’t know how to ride a bike, how do you...? Thursday, June 6, 13
  12. BuySellAds.com domain Dedicated Server Authorize.net account SSL Certificate Fastmail.fm Email

    Hosting What does it cost to get started? $2,200 $350 $35 $99 $5 $2,299 one-time $390 monthly formal apology to John Collison for not being a Stripe customer (yet) Thursday, June 6, 13
  13. 76% of tech companies acquired in 2012 had not raised

    institutional investment (VC/PE) prior to acquisition http://www.cbinsights.com/blog/acquisitions/tech-mergers-acquisitions-deals-2012-report Thursday, June 6, 13
  14. For each bootstrapping related article written on TechCrunch there are

    OVER 15 written about venture funding Thursday, June 6, 13
  15. Widget Co. 35% in exchange for 3 million Series A

    20% allocated to employees & executives 25% in exchange for 7 million Series B 10% for each founder + = 100% Thursday, June 6, 13
  16. Acquisition price (all cash): $50 million Investor 1 owns 35%:

    $17.5 million Employees own 20%: $10 million Each founder owns 10%: $5 million Investor 2 owns 25%: $12.5 million (each) Thursday, June 6, 13
  17. Don’t forget about Uncle Sam! $5,000,000 million - Uncle Sam’s

    cut $4,000,000 million Thursday, June 6, 13
  18. What can you do with 4 million bucks? 1. Pay

    off your mortgage or buy a house 2. Watch it collect dust in your bank account (or agonize over the ups and downs of the stock market) ... and we didn’t even assume what would happen if it were a cash and stock deal Thursday, June 6, 13
  19. Acquisition Price (all cash): $50 Million with $0 raised Each

    founder owns 45%: $22.5 million Employees own 10%: $5 million (each) After Uncle Sam - $18 Million each Thursday, June 6, 13
  20. What can you do with 18 million bucks? 1. Pay

    off your mortgage or buy a house 2. Watch it collect dust in your bank account (or agonize over the ups and downs of the stock market) 3. Spend as much time with your family for the rest of your life as you would like... Thursday, June 6, 13
  21. All money comes with strings Make sure they’re strings you

    can and want to live with that’s one vicious fish hook! Thursday, June 6, 13
  22. Just because you are bootstrapping now... doesn’t mean you will

    always have to bootstrap Thursday, June 6, 13
  23. We like being in TOTAL control Many reasons... Not sure

    what we’d do with the money and... Thursday, June 6, 13
  24. BuySellAds is a remote team 3 in Boston 4 in

    California 2 in Toronto 1 in Quebec 1 in Leipzig, Deutschland 1 in London 1 in Texas 1 in Maine 1 in Romania 1 in Bangladesh 3 in North Carolina Thursday, June 6, 13
  25. I’m nervous how that would change if we raised some

    cash We’re not interested in operating un-profitably ahead of growth. Thursday, June 6, 13