At the end of 2019, I was getting tired of exchanging my time for money (consulting). The gig was excellent with plenty of freedom, a competent team, and paid well enough. Still, filling timesheets, reporting hours, I felt something was missing - no matter how good I did, the pay was still the same. Better total compensation was available either by putting in more hours or moving on to the next gig with a similar incentive structure. Still, my earnings were detached from the value I created.
Now, I’m not saying I was underpaid. I’m saying the price discovery for the value of my labor had been insufficient. I had quoted the “regular local freelancer price” and got the gig. Maybe the client could have gotten someone of a similar level for a better price, or I could’ve found a client willing to pay more. Anyway, a market convention set my price, not my skills, or luck even.
I was pretty sure I had what it takes to build a SaaS product - both skills and risk-tolerance-wise. One thing led to another (I’m skipping some false starts here), and I got a lucky message from a domain expert. We’ve been working on RecruitLab for 437 days now.
I was prepared for hard. But my preparedness was theoretical - shaped by survivorship bias and content marketers and funnel-filling VC-s. This is my personal, totally unbiased, and unsponsored account - what surprised me about being the technical founder of a B2B SaaS startup.
Taking the “Minimum” Out of MVP
The gap between “it works” and “it’s enjoyable to use” was bigger than I expected. This is where I perceivably hit the limit of my skills. I could put together acceptable UI-s from pre-made components, but I just couldn’t “make them pop.” For the most critical paths, we outsourced the design. And spent a fair chunk of our limited cash on it. I have collaborated with Artur from UX Estonia before, and once again, they delivered.
This might be my personal disposition, but making UI changes prescribed in a Figma document feels tedious for me. When writing backend business logic or composing a UI with existing components, it feels like the value per keystroke is so much higher. The payoff from creating a shinier UI diminishes rapidly from some point. When faced with actually doing the CSS work, the level of diminishing utility might feel closer than it really is. When I say: “we don’t need to involve a designer here,” does it mean I’m lazy or prudent?
We Built It - Now Where Are the Users?
While doing things that don’t scale, you get to taste the business end of a hockey stick. Even while maintaining a double-digit percentage MoM growth rate, the absolute number of additional new users is low. Why are we building so much to serve so few users? At this stage of growth, producing the software costs more than it generates. Are we the MoviePass? If growth keeps up, the initial software investment will be peanuts. If it doesn’t, it will be a bad investment.
After closing our first clients, I often felt that having more users would allow for better-informed product decisions. To get more users, we would need to sell more. And we could sell more if we had a more mature product. To make the product more mature, we would need to make better product decisions. And for that, we need more users. That chicken-egg problem was surprisingly frustrating.
Time Decay of Founders Equity
With a stable-ish income, personal finance is simple - if you spend less in a month than you earn in a month, you’ll generally be fine. Bootstrapping a SaaS company is a privilege for people who have savings for X months and can afford to spend it. While on a steady paycheck, these savings provide security. When deciding on bootstrapping, these savings become committed to your future living expenses, and the security disappears. And if you don’t feel it when committing, you’ll definitely feel it after a few months, when the account balance is significantly lower than before.
Did I know that spending money and not earning any reduces your cash balance? Well yeah. Could I imagine the stress? Not really.
When reading SaaS startup blogs and think pieces, the consensus seems to be - don’t do custom developments to win clients, or you’ll end up as a consultancy. If it were that easy! Usually, when considering custom development for a client, we go through a checklist. Were we planning to do it anyway? Would other clients want it? How important is the client? Will this actually make them sign? Even after weighing those and making a decision, there’s always this doubt lurking - did we sacrifice some long-term good for a short-term gain? Are we the consultancy?
Freedom, responsibility, these things float my boat. Would I recommend bootstrapping a SaaS company as a technical founder to a friend or a colleague? Yes, for the patient ones. For my past self? Definitely.