How we built a $1M ARR SaaS startup

Congrats. My wife and I built our infosec biz which now has a team of 40 and self funds. A few thoughts on going significantly beyond $1MM in my experience:

North of 1m I started focusing more on brand marketing. Think Red Bull and creating a feeling around your brand, what space you occupy in people’s minds and why. This kind of marketing is hard to measure and becomes more feasible as your budget expands.

Consider getting an excellent HR consultant to deal with complex issues that will emerge as the team expands. You haven’t seen it all.

Get a kick ass law firm on your side. You’ll need them for day to day and not so day to day stuff like asserting your trademark rights. As execs, get friendly with a partner at the firm and try to do the occasional lunch. They’ll be an amazing source of network and a counselor when you get your first offer for acquisition.

Get a great firm of accountants, even if you do your own books. They’ll also be excellent advisors.

Try to promote internally and invest in your team with education allowances and subsidies. Once your business is humming, your existing people know the customer, product and culture. This has worked extremely well for us.

Avoid hiring a “seasoned executive” or manager. They bring little value, will only give you a sense of comfort and are very expensive.

Assemble a leadership team of trusted lieutenants and get good at trusting and delegating.

Learn as leaders (talking to the founders) that you aren’t one of the team anymore. You’ll learn this the first time you walk up to your crew at a conference as you see them happily chatting with each other, and as they see you they’ll stop and all eyes will turn to you. Then you’ll pretend you just came over to say hi and were going to sit somewhere else. And you’ll go sit somewhere else because you don’t want to interfere with the important team bonding that is happening.

Say no to your first few acquisition offers. You’re bootstrapped and cash flow positive which is lightning in a bottle. Congrats!! You can always say yes later.

Don’t feel insecure about just repeating the things that work, but at larger scale, all the way to 9 figures. Business is surprisingly basic.

Don’t take funding if you can avoid it. You’ll be amateurs entering the ring with prize fighters who negotiate funding deals every day and you’ll regret it on many levels. Focus the energy on growing that cash flow and use that for funding.

Build a war chest that’ll carry you for 6 months without layoffs if your revenue completely stops. This will take a few years.

Monitor your cashflow religiously and get good at predicting expected performance so that you can catch slow downs early and react soon. Early detection is key. When your revenue dips, don’t panic and make the hard calls fast.

Congrats again and you can DM me on Twitter @mmaunder if you have specific questions e.g want supplier recommendations.

Best of luck.

~Mark

It never made sense to me why these kinds of 'marketing', 'feedback gathering', 'a/b testing', 'email campaign management' and 'project management' tools seem to always make so much money when clearly they add no value at all to the businesses who use them or their customers. They just keep employees busy and create more jobs. I blame the Federal Reserve Bank's money printing. One of the Fed's 2 mandates is 'job creation' but people severely underestimate how damn good the Fed is at achieving its targets in that regard.

The Fed will keep printing more and more money and jobs will become increasingly useless. It terrifies me to think that the situation could get worse than this and most people still won't notice.

If it continues down this path, in the future, we'll have people whose entire career will be to sit at a desk and stare at a wall from 9am to 5pm and their employers will seriously believe that this activity adds value to the economy. We'll have consultancies which specialize in wall staring. Some will specialize in staring at white concrete walls, others at wooden walls, etc...

It might sound like I'm joking, but I'm very serious.

I am not sure I understand product. What is it that Trello or JIRA cannot track that you are offering?

I looked at the product and it appears like you can track which feedback (whether product or employee) is bubbling up based on popular vote.

How do you offer to track users? Do you expect me to make my board public for collecting feedback or something else?

BTW, you had a great milestone. As someone in infancy of building my product, $1MM ARR souunds really good.

Now, to add to what other users are saying, it appears like you both (Hum and Rasmussen) worked at FB before. I would imagine you made a bank (aka $500k at least) between you before jumping the ship.

A few questions - 1. How did you find first few customers? 2. How did you convince them to buy over existing products with fair degree of overlap such as Trello, JIRA, ProductPlan, RoadMunk etc. 3. Who do you consider your competitors?

TIA for answering!

This is inspiring and depressing to see (more inspiring). I've spent the last 4 years getting a bootsrapped saas off the ground. It's taken every ounce of my being to get us profitable, but we wouldn't be close to hitting 1 mil (USD) ARR for at least 2 more years.

Every year that passes I suspect it becomes more and more impossible to get anything off the ground without at least a little bit of funding. If I had my time again, I don't think I'd go bootstrapped. Seed funding seems to be a great compromise between bootstrapped and angel/VC. TinySeed are doing some great things on that front.

Props to you guys and gals for making it work! It looks like a great product and a great team.

You’ll notice these tasks are fairly large. You should pay candidates for their time.

Love this comment in the article regarding hiring via a time consuming vetting process.

I think that's what bothers me most about technology hiring these days.

There is more testing and mini-projects than ever.

It's not uncommon to spend half a day just going through first rounds for companies.

I'd love something like: make it to the second round and we will compensate you for your time going through the vetting process.

Then I'd know they value my time and are serious.