[HN Gopher] How we bootstrapped our SaaS to $1M ARR
___________________________________________________________________
How we bootstrapped our SaaS to $1M ARR
Author : ksahin
Score : 253 points
Date : 2022-01-21 13:54 UTC (9 hours ago)
(HTM) web link (www.scrapingbee.com)
(TXT) w3m dump (www.scrapingbee.com)
| artembugara wrote:
| Kevin, Pierre: congrats! And thanks for all your help to the
| NewsCatcher team.
|
| We use ScrapingBee's SEO progress as a benchmark of growth.
|
| Also, to the HN crowd, we found out about TinySeed from
| ScrapingBee, and applied and got in for the next batch. We've
| grown from ~4k MRR to 16k MRR in 10 months.
|
| So, to anyone who consider apply to YC, I'd recommend to take a
| look at TinySeed: https://tinyseed.com/
| daolf wrote:
| Thank you Artem!
|
| Wishing you all the best with NewsCatcher and happy that
| TinySeed is living up to your expectation.
| ksahin wrote:
| Thanks Artem!
| corentin88 wrote:
| Congrats to the team!
| daolf wrote:
| Thank you!
| tr33house wrote:
| It's ridiculously hard to get to $1M ARR. ScrapingBee seems to be
| in the sweet spot where you don't have to work as hard to keep
| things running so it can be ran `forever` with a small team. This
| is no small feat and should be celebrated.
|
| All the best!
| sombremesa wrote:
| > It's ridiculously hard to get to $1M ARR
|
| This is a blanket statement and it's very wrong.
|
| Know better than to look at revenue versus profit. Then again,
| Silicon Valley seems to have long since given up on that idea!
| encoderer wrote:
| Right, sure, silicon valley doesn't know how to turn a
| profit.
|
| /s
| sombremesa wrote:
| Is that what I said? I don't think that's what I said.
|
| What I actually said was that SV investing has ignored
| profit and looked at revenue for a while now.
|
| I don't know why I'm even bothering to explain myself, you
| decided to start a business and the best you could do was
| uptime monitoring.
| blantonl wrote:
| Boy this resonates. Not every business needs to "change the
| world" and IPO with a valuation of $10 Billion.
|
| There are thousands of small businesses out there that provide
| a quality service, and generate good revenue, and pay their
| founders and employees amazing sums of money.
|
| Love it.
| daolf wrote:
| Thanks a lot for the kind words.
| mike31fr wrote:
| Felicitations les gars ! Tres jolie photo de Castres. Signe un
| ingenieur informatique toulousain passionne d'APIs et expert JS
| dont le but ultime est de vivre la meme aventure que vous : aider
| les gens a resoudre un probleme grace a un SaaS qui me permette
| d'en vivre. Actuellement bloque au step 0 : trouver une douleur a
| resoudre dans une niche. Respect, et merci pour l'inspiration.
| Bravo.
| nelsondev wrote:
| Awesome story and congratulations!
|
| You recommended Rob Walling's book, Start Small, Stay Small, but
| what else can I read?
|
| And where do "indie hackers" like you hang out on the internet,
| so that i can learn more about how to do this myself?
|
| Any other resources worth sharing?
| daolf wrote:
| Community:
|
| - IndieHackers (haven't been here in a wild but I definitely
| recommend the funders interview)
|
| - Microconf
|
| - Twitter
|
| Book:
|
| - From Zero to Sold (Arvid Kahl)
|
| - Hello Startup (Yevgeniy Brikman)
|
| I hope it helps :)
| cercatrova wrote:
| > And where do "indie hackers" like you hang out on the
| internet, so that i can learn more about how to do this myself?
|
| https://www.indiehackers.com coined the term I believe
| limedaring wrote:
| MicroConf Connect is an awesome bootstrappery community:
| https://microconf.com/connect
| Xt-6 wrote:
| "Small Giants: Companies That Choose to Be Great Instead of
| Big" is interesting. Most of the companies features are outside
| the tech industry.
| wenbin wrote:
| Congrats on achieving the $1m ARR milestone!
| daolf wrote:
| Thank you very much!
| floridageorgia wrote:
| @daolf and team: Congrats on this significant milestone and thank
| you for being so candid about your growth journey.
|
| I'm a bootstrapping founder, have a question about your amazing
| blog. Love the scrolling table of contents on the left and
| title/cta that appear on the top as you scroll. Do you mind
| sharing what cms/theme you use for your blog?
|
| Unless I missed it completely, a suggestion I have for your blog
| is to have a search feature.
|
| That said, genuinely inspired by your story and grateful for your
| transparency on how you made it happen. All the best!
| [deleted]
| dgudkov wrote:
| Long story short - they tried different things, got small MRR,
| took money from an investor and grew up to $1m ARR in the next 2
| years.
| yawnxyz wrote:
| I absolutely love ScrapingBee, but I wonder if the TPS lawsuit
| will eventually affect ScrapingBee?
| jillesvangurp wrote:
| Great pitch and inspiring story. I've been involved with a few
| startups that failed. So, I know a lot about humility and hard
| work. Basically, my first starup we were naive. It ended with an
| acquisition which was ultimately worth nothing. The startup that
| acquired us raised a lot but ultimately failed as well and I
| personally turned off the lights (by means of shutting down our
| AWS stuff). After that, I consulted for a while to make money and
| then got involved again with another startup. But this time with
| the wisdom of hindsight.
|
| I've got a good feeling about my latest effort (tryformation.com)
| where I am the CTO. For the first time, I have a combination of
| talent around me, a market that is showing actual interest in
| what we do (and paying us), and a level of control over our
| product, tech, and road map that means it is really my job to not
| mess this up. It's still super risky but there's a good chance I
| can make it work this time. I rebooted the product (rebuilt it
| from scratch), I've defined our product and vision and took
| ownership of the product roadmap. And it's working. We are
| closing deals and getting positive feedback from our early
| customers. This year is critical for us.
|
| Early revenue is super hard without significant funding.
| Accepting pizza money from some accelerator helps a little but
| it's really not about the money usually but about getting some
| coaching, advice, and building a network around your company of
| people that can help you. If you are doing SAAS, you need sales
| people. And not just any people but good ones. A warm
| introduction can make all the difference you need.
|
| Of course the trick is picking the right accelerator. YC,
| Techstars (for which I have mentored), and a few others stand out
| as being awesome. In our case, we actually joined the Bosch
| Startup Harbour program in Berlin, which helped us build
| relationships with German industries. Some of those are now
| becoming customers and a few others might follow. So, good value
| for us. We did not give away equity and we did not receive a lot
| in terms of cash. But it helped us a lot.
| manmanic wrote:
| This is _almost_ cool, unfortunately the product itself (a
| network of bots to allow websites to be scraped when they
| obviously don 't want to be) seems a little shifty. For example,
| put these three exhibits together:
|
| Exhibit 1: The ScrapingBee terms and conditions state "We assume
| that you use the Website Platform and Services legally and
| ethically and that you have obtained permission, if necessary, to
| use it on the targeted websites and/or other data sources." This
| is even backed up with an indemnity clause in which the user has
| to cover ScrapingBee for any third-party legal claim arising out
| of their use of the product.
|
| Reference: https://www.scrapingbee.com/terms-and-conditions/
|
| Exhibit 2: ScrapingBee explicitly advertises a feature allowing
| you to get Google search results via an API call. These results
| are presumably generated by scraping Google's search pages:
|
| Reference: https://www.scrapingbee.com/features/google/
|
| Exhibit 3: Google's own documentation explicitly states that
| automated querying is prohibited, so if you use this advertised
| ScrapingBee service, you are naturally violating Google's terms,
| and could be liable to cover ScrapingBee's legal costs if Google
| decide to come after them.
|
| Reference:
| https://developers.google.com/search/docs/advanced/guideline...
|
| $1MM in ARR is all well and good, but there's a limit to how
| large this business can grow without being pursued by the
| websites whose scraping they are enabling, and in the case of
| Google, explicitly promoting.
| twox2 wrote:
| It's good that there are businesses like this testing the
| legality of scraping. The notion that scraping should be
| illegal is absurd IMO.
| [deleted]
| niel wrote:
| Congratulations on your success, Kevin and team.
|
| I couldn't find this on your website - does Scrapingbee respect
| robots.txt directives, or is there any other method for a website
| owner to limit or even just slow down your scraping?
| babelfish wrote:
| They almost certainly don't
| j0hns0n wrote:
| Wow, what a clever commerical. Yes, $1m can help you grow your
| business and quibbling about where it comes from and what it
| means says a lot about where we're at and how trivial it is to
| win $1m.
|
| Echo Chambers echo.
| daolf wrote:
| What?
| capableweb wrote:
| Congratulations! But maybe "bootstrapped" is not a 100% correct.
|
| > MAY 2020 - Joining Tinyseed
|
| > And this is precisely why we never decided to raise money.
| However, a few years ago, [...] An accelerator designed precisely
| to help people grow their business [...] The money and the
| support we got from the program helped us grow ScrapingBee into
| what it is now
| daolf wrote:
| Co-founder here, I was waiting for this comment to be honest.
|
| So in essence, if you consider that bootstrapping is building a
| business without external funding, you're correct.
|
| But to me, bootstrapping VS "VC road" is much more nuanced than
| this.
|
| Going the VC road forces you to have crazy growth and raise
| more round because the VC model only works if they fund unicorn
| 1 time out of 100(0).
|
| TinySeed works even if they fund 8/7 figures businesses, and
| this was our goal. We had no money when we began (we went
| through most of our savings during our first venture), no
| family to raise an angel round and this solution was perfect
| for us.
|
| The amount of money we got was nothing near what we could have
| had raising traditional money, but it allowed us to stay
| independent and grow at our own pace.
| btown wrote:
| To me, it's really important that the tech community define
| "bootstrapping" as no more and no less than "having a plan to
| reach profitability with total investment on the order of
| what a [not-outrageously-wealthy] group of founders might
| invest," and to frame it as a _good thing_.
|
| With TinySeed's round at "$120k for the first founder, $60k
| for the second, and $40k for the third"
| (https://tinyseed.com/program#program-faq) this is very much
| along those lines.
|
| If one further gatekeeps the label with "but the founders
| need to invest this personally or it doesn't count..." that
| restricts the label to a very small segment of privileged
| individuals. And in a world where there's a (false) narrative
| of a "bootstrapped or VC backed" binary, that gatekeeping
| reinforces the notion that less privileged founders have no
| choice but to go the VC route or do nothing at all. I would
| hazard a guess that great ideas and great societal impacts
| have been lost as a result of this framing.
| threeseed wrote:
| > having a plan to reach profitability with total
| investment on the order of what a [not-outrageously-
| wealthy] group of founders might invest
|
| $120k USD is a lot of money for many international
| startups.
|
| 10-20 years ago it was also a lot of money for US startups
| to receive early in their journey.
|
| So this definition is pretty pointless.
| Zababa wrote:
| $120k is an big amount of money, especially for people that
| don't have FAANG salaries. That could be an appartment
| where I live. A small one, but an appartment. It's also 3
| years of earnings for me, or it would be if I didn't spend
| anything.
|
| > If one further gatekeeps the label with "but the founders
| need to invest this personally or it doesn't count..." that
| restricts the label to a very small segment of privileged
| individuals.
|
| People for which $120k is money that people around them can
| just invest _are_ a very small segment of priviliged
| individuals.
|
| Another point: tinyseed also offers mentorship. From the
| FAQ:
|
| > I don't need the money, is TinySeed worth it just for the
| mentorship?
|
| > Short answer: yes.
|
| This message is not to knock on the people behind
| ScrapingBee. Bootstrapped or not, they have built a very
| profitable business, that's impressive and deserves praise.
| I just think calling it "bootstrapped" is not correct.
| codegeek wrote:
| If you take money in exchange for equity, that is NOT
| bootstrapping no matter what spin we put on it. If the
| business fails, founders are not personally liable to
| return that money that was raised from investors. That is
| not bootstrapping.
|
| Bootstrapping is your ability to come up with money on your
| own or through loans etc which you are liable to pay back.
| If you don't you could lose your home. Investors don't come
| for your home when you lose their money.
| mbesto wrote:
| > it's really important that the tech community define
| "bootstrapping"
|
| More importantly we should probably define what a "startup"
| is. No one seems to agree on a definition there.
| jasode wrote:
| _> , it's really important that the tech community define
| "bootstrapping" as [...] With TinySeed's round at "$120k
| for the first founder, $60k for the second, and $40k for
| the third" (https://tinyseed.com/program#program-faq) this
| is very much along those lines._
|
| But when YC invested $120k for 7% equity, we typically
| didn't call all those startups like Dropbox/AirBNB etc
| "bootstrapped companies". And $180k for 2 founders is
| _more_ than YC 's previous terms.
|
| _> If one further gatekeeps the label with _
|
| It's unfair to call it "gatekeeping" rather than a case of
| confusing many readers with a headline that flips the
| meaning of "bootstrapping".
| btown wrote:
| You're eliding the most important part of the definition
| IMO: a plan to reach profitability with the initial
| investment alone. YC never expects its companies to
| become profitable with their investment alone, nor should
| it - it's designed for growth companies that will receive
| multiple rounds of funding over time!
| daolf wrote:
| That is very elegantly said.
|
| 100% agree with you.
| no_wizard wrote:
| Why is that a problem? Bootstrapping is a privilege, just
| like raising any VC funding is, yet nobody is fighting to
| change the term for Venture Capital funded startups.
|
| The meaning of which has been well established, both inside
| tech circles and outside, to mean starting a business
| without raising any outside capital.
|
| Why do we want to suddenly stretch the meaning of
| bootstrap? The compelling story here would have been "how
| we created a SaaS business with 1M ARR with only seed
| funding", and I'd still have read it. That is something
| worth being proud of, why is bootstrap better?
| rhizome wrote:
| > _Why do we want to suddenly stretch the meaning of
| bootstrap?_
|
| Because VCs increase the risk that a company will turn to
| shit.
| no_wizard wrote:
| Doesn't make it okay to stretch the meaning of something
| that is well established. Not _all_ VCs are bad, not all
| companys funded by VC money turn into crap. Not all VCs
| use the same model.
|
| It would be best to explain this. Like I mentioned, why
| not plainly explain that they did all this with just seed
| money? That's a really amazing accomplishment in and of
| itself, and nuance is something that can be explained.
|
| Not to mention, trying to stretch the meaning here is
| trying to glob a positive onto something that didn't earn
| it by fitting the definition. Again, why try to obfuscate
| the truth? Be proud of your background if you think you
| can be proud of it. Nothing wrong with that.
|
| Just don't try and redefine something that already has
| concrete meaning. That's nearly the same thing, in my
| mind, as lying.
| j4yav wrote:
| Certainly it must be a lot easier to bootstrap a company if
| you sell equity to investors to enable working on it full
| time, but are you still really bootstrapping your app at that
| point? Even if you only sell as little equity as you need to
| to pay the bills until the app is able to pay for itself?
| codegeek wrote:
| As another bootstrapped founder, I disagree with you.
|
| "Our standard terms are for 10-12% equity."
|
| The moment you give equity in exchange for money no matter
| whether its tinyseed or whatever, you are not bootstrapping.
| Your financial risk is lower because you don't have to pay
| this money back if your company fails. That is not called
| bootstrapping.
|
| I bootstrapped with my own money AND some smaller loans which
| I am fully liable to pay off with a personal guarantee. If my
| business goes down, I am personally liable. That is
| bootstrapping.
| floridageorgia wrote:
| My 2c as a bootstrapping founder (who has not taken outside
| money): I don't think there is any virtue in funding your
| business with your own money. Call yourself bootstrapped or
| funded, what ultimately matters is that the business
| survives and thrives.
| whimsicalism wrote:
| Sure, but words have meaning and bootstrapping is
| specifically about not selling ownership for cash
| dustingetz wrote:
| most bootstrapped founders are not bootstrapping by
| choice. "has not taken outside money" implies there was
| money offered at some terms and therefore available to be
| taken, which is weaponized language here because even in
| the best circumstances getting that first term sheet is
| not something that just happens on accident, it's an
| uphill battle and you have to want it. If you bootstrap
| for a while and then eventually level up and get some
| money to grow faster, you still bootstrapped, you're
| bootstrapped, you dragged the company from zero to one
| and it's alive because of that.
| whimsicalism wrote:
| i don't understand what there is to argue over, i am just
| saying what the word means.
| lmeyerov wrote:
| Important for others: Some loans do not extend this way and
| thus company bankruptcy (US) can protect you, so just
| opportunity cost. But the terms are generally bad, and why
| firms like tinyseed exist, esp. once revenue starts growing
| (though at that point you can potentially get a SAFE at
| better terms...).
|
| Money is so sensitive! A Google millionaire bootstrapping
| on surveillance savings or a doctor taking favorable loans
| for starting a practice is different from say a college
| grad bootstrapping on no savings. Most SaaS is especially
| hard as there is typically no real revenue for ~years,
| compared to say B2B where each customer can easily pay for
| .5-5 people. So if operational expenses come from revenue,
| including sales/marketing/r&d, bravo.
| codegeek wrote:
| I hear you but most small business loans try to push you
| for personal guarantee. You can fight it but it usually
| is tough unless you have real physical collateral in the
| business which is not the case for software companies. I
| have talked to Bankers who told me that unless the
| business is brick and mortar with inventory and machinery
| or real estate, they cannot give loans without personal
| guarantee even SBA backed loans.
| chinathrow wrote:
| > If my business goes down, I am personally liable.
|
| Why? I also own my own business (an LLC somewhere in
| Europe), but if it goes down, I am not personally liable,
| at all (unless it's due to gross negligence established by
| a court case).
| HWR_14 wrote:
| Basically, he personally borrowed money and put it in his
| LLC to finance it. For tax and other purposes, this is a
| more complex transaction that is somewhat legally
| different (the business took out and should repay the
| loan, avoiding his personally being taxed for the money).
| However, that's the best way to understand what happened.
| jasode wrote:
| _> Why?_
|
| His comment included the fact the he took out loans with
| a _" personal guarantee"_.
|
| When you're a small business starting out with no assets
| (like factories, equipment, etc) -- which means no
| collateral, or no business revenue... the banks won't
| provide so-called "business loans" unless there's a
| personal guarantee.
|
| Therefore, if the business fails and the company is shut
| down, the founder is still financially on the hook to pay
| back the loans. (Barring drastic options like filing
| personal bankruptcy.)
| codegeek wrote:
| You nailed it!!
| capableweb wrote:
| I understand that TinySeed is different than the typical
| doing VC roadshows and having crazy growth, that wasn't my
| point. I also understand that the amount you received from
| TinySeed wasn't probably too crazy, it's in their name after
| all; tiny seed. But that name also contains what they do,
| they provide seed funding.
|
| Instead of contrasting Bootstrap VS Crazy-VC-Mode, it's more
| suitable to compare two different things. One is if you're
| bootstrapped or not, and if you're not, are you doing Tiny-
| VC-Mode or Crazy-VC-Mode? In this case you chose not to be
| bootstrapped, and are doing the Tiny-VC-Mode.
|
| It's great that going Tiny-VC-Mode allowed you to grow at
| your speed and still remain independent, much better than the
| Crazy-VC-Mode usually allows. But if we start calling that
| "bootstrapped", then where does the line go for what is
| bootstrapping a business or not. The meaning would have to
| change from "Without any outside money" to "With a little bit
| of outside money, but still independent" which says something
| else.
|
| Edit: Another way to see it: You still bootstrapped the early
| stages of the company, up until the point where you accepted
| outside investments. So according to you post, you joined
| TinySeed in May 2020, which your graph under "Slowly reaching
| $10k MRR" (https://d33wubrfki0l68.cloudfront.net/e1ea487c1823
| d29fb55da4...) show to be right around $5K MRR. So what you
| bootstrapped was up until "$60000 ARR", but after that you
| were no longer bootstrapped as TinySeed provided capital to
| you.
| jgmmo wrote:
| bootstrap = on your own. That's it.
|
| You had some seed funding.
| artembugara wrote:
| Founder of another TonySeed startup.
|
| On your own can mean many things. I also burnt through my
| personal savings for the first year.
|
| So. On your own is just "VC'ed yourself"
|
| Taking money from TinySeed is very different than taking
| money from VC.
| nkozyra wrote:
| > So. On your own is just "VC'ed yourself"
|
| Well, yes. You're assuming the risk, not an external firm
| that in exchange demands a chunk of the company.
|
| In a truly bootstrapped company the risk is yours alone
| as is the potential reward.
| capableweb wrote:
| > So. On your own is just "VC'ed yourself"
|
| Precisely. If TinySeed has provided funds, it's no longer
| "VC'ed yourself", it's "VC'ed yourself + tiny seed from
| TinySeed".
|
| > Taking money from TinySeed is very different than
| taking money from VC.
|
| No one is arguing that TinySeed is just like any other
| VC. But instead that by accepting VC, you could no longer
| claim the business to be bootstrapped.
| BBC-vs-neolibs wrote:
| So if I start with $1M of my own money, is it
| bootstrapped?
|
| If family (with fuzzy conditions) ponied up $250k, is it
| bootstrapped?
| Bjartr wrote:
| $1M of your money? Yes
|
| $250k from immediate family, if said fuzzy conditions
| don't confer any ownership or repayment? I'd say just
| barely yes (it's basically a gift to you at that point,
| which is then your money)
|
| $250k from a third cousin in return for equity? No.
|
| Being bootstrapped isn't an ungameable category, but it
| is a fairly unambiguous one IMO.
| [deleted]
| Zababa wrote:
| You're assuming that the only categories that exist are
| "bootstrapped" and "took VC money". That isn't the case.
| Raising money from friend, or taking a loan from a bank
| would be neither boostrapped nor VC-funded.
| [deleted]
| chrisan wrote:
| "VC'd yourself" is the definition of bootstrapping.
|
| You either take money from someone else or you bootstrap
| it yourself.
| nrmitchi wrote:
| It's kind of disingenuous to try to make this same
| comparison across different people.
|
| What if you borrow money from family in order to start
| your business? Are you no longer "bootstrapping"?
|
| What is Bezos decides he's bored, and wants to start
| something new. Really looking forward to seeing the "most
| successful bootstrapper of 2030" be Jeff Bezos with his
| self-funded $5B "startup".
| Cederfjard wrote:
| I mean I understand the concepts you're talking about,
| but maybe you need other terminology? Bootstrapping
| doesn't make as much etymological sense if it also covers
| "got some outside funding, but not too much".
| Zababa wrote:
| Bootstrapping is not a statement about difficulty,
| bootstrapping is a statement about where the money comes
| from. That's it.
| [deleted]
| artembugara wrote:
| This
| mbesto wrote:
| Nice little meta discussion we have here...
|
| Once again another thread where no one seems to agree on what
| constitutes venture capital and what a startup is.
|
| By definition - you took a minority investment.
| Bootstrapping, colloquially, means you have not funded your
| company with any equity or capital that could be converted to
| equity.
|
| btw - you got attention by saying you were bootstrapped and
| since this is just marketing material then kudos to you for
| the good marketing.
| threeseed wrote:
| > bootstrapping VS "VC road" is much more nuanced
|
| Sure. But don't try and redefine what bootstrap means.
|
| It means building your company without requiring any
| professional investors and without modifying your cap table.
|
| You've done neither.
| cj wrote:
| My definition of bootstrapping has more to do with the
| mindset you have while running the company, rather than
| whether the company actually has investors.
|
| There's always _someone_ putting money into getting a new
| business up and running (bootstrapping is not free).
| Whether that small amount of money comes from the founder's
| pocket, family /friends, or an angel investor - the money
| to pay your AWS bill and other basic services has to come
| from somewhere.
|
| Bootstrapping is an operational mentality IMO.
| threeseed wrote:
| You really don't understand bootstrapping do you.
|
| So my partner started a business during COVID. We don't
| have rich family/friends or know any angel investors and
| so we paid for costs by selling things, using savings and
| maxing out credit cards.
|
| No outside money. No modification to a cap table (not
| that it exists).
| cj wrote:
| If tomorrow you decided to go and raise $100k from an
| angel (or if you received a $100k small business grant)
| to pay off your credit card debt and replenish some of
| your savings, I wouldn't immediately kick you out of the
| "bootstrapped founder" community.
|
| I see your point though. There is "pure 100%
| bootstrapped" and "mostly bootstrapped, but not
| completely". IMO it's a spectrum. Just like the term
| "startup" - it's a spectrum, no binary definition.
| threeseed wrote:
| If you raise $100k from an angel then you were a
| bootstrapped company and now you aren't.
|
| No spectrum. No complications. No twisting of words. Very
| simple.
| mathgladiator wrote:
| TinySeed calls itself "The First Accelerator Designed for
| SaaS Bootstrappers", so perhaps there is a schism in the
| definition.
| djbusby wrote:
| Hmm, but TinySeed now as a position in your captable. They
| are outside money. I think bootstrap means 100% your own
| money and customer money (revenue)
| moralestapia wrote:
| >if you consider that bootstrapping is building a business
| without external funding
|
| Yes. Yes, we do.
|
| You didn't bootstrap, period.
|
| Also, what a strange hill to die on ...
| PragmaticPulp wrote:
| I appreciate the honesty and the article, but it would have
| been just as interesting (and more authentic) if you would
| simply be honest:
|
| "How we got to $1mm ARR with only a tiny seed round".
|
| Reading an article and immediately recognizing
| inconsistencies is an instant turn-off for me, and I assume
| many other readers. I don't see what you think you're gaining
| by being misleading with the headline.
| mattlutze wrote:
| The common use for "bootstrapping" is using personal capital
| and then funding the business with its own proceeds.
|
| If you'd say "How we grew our business without traditional
| VCs" that'd be an excellent title. What you describe in your
| comment here sounds like an interesting alternative approach.
|
| But the way it's introduced looks like an article about how a
| 25 year old bought their own house, and step 5 is "my parents
| took the mortgage and I pay them rent."
| czbond wrote:
| @Daolf - congrats on the building, definitely NOT easy to do.
|
| What growth metrics did Tiny look at? Did the investment come
| at a time when the business was needing to "survive, sustain,
| or grow"? [every business has all of those phases]
| daolf wrote:
| Thanks a lot.
|
| > What growth metrics did Tiny look at?
|
| I assume you mean during the application process. So they
| asked just the basic stuff, MRR, growth, churn. We were at
| $1k5 MRR when we applied and $3k when we got it. I think
| what worked for us during the process was that Kevin had
| been running a small Java web scraping blog + book at that
| time.
|
| > Did the investment come at a time when the business was
| needing to "survive, sustain, or grow"?
|
| We were slowly switching from survival to sustain mode.
| They allowed to make the transition and go full grow mode.
| robocat wrote:
| > They allowed to make the transition and go full grow
| mode.
|
| The point of bootstrapping is making the compromise where
| you trade a lower growth rate for the benefit of
| retaining 100% ownership of your business. Your statement
| is a VC funding model, even if the money is called seed
| and you are not trying to become a unicorn.
|
| Your giving away equity for money is simply not
| bootstrapping. Calling your business bootstrapped is
| lying in my opinion. What I think doesn't matter, but
| being deceitful is silently judged by others where their
| opinions do matter to you, and the consequences of that
| are usually invisible.
| rglover wrote:
| Bootstrapping means you funded the entire thing out of pocket
| without any outside investment.
|
| There's nothing bad/wrong about how you did it, but it's not
| bootstrapping. Saying it is makes it confusing for newbies
| which means they're more likely to be taken advantage of by
| VCs that realize they can market themselves as a
| "bootstrapper fund."
| kohanz wrote:
| Thinking about it in such binary terms is quite limiting
| and unhelpful though. It's a spectrum. I would consider
| ScrapingBee closer to a bootstrapped company than a
| venture-funded company. Heck, by your definition if I took
| $5k of friends & family money to start a business that grew
| to $5M ARR,I could not call that "bootstrapped".
|
| This is why Rob Walling (co-founder of TinySeed) likes to
| use the term "fundstrapped". There are a lot more funding
| options out there that do not come with the narrow pathway
| associated with typical venture funding.
| no_wizard wrote:
| Why is it unhelpful? Its okay for things to be binary
| sometimes. This is one of those cases, where the meaning
| of something, beyond even tech circles, has always meant
| starting and building a successful business without
| raising outside capital.
|
| There's no good reason to change the definition of this.
| The disparagement is trying to co-opt a term that
| shouldn't be co-opted. If the headline was _how we built
| a 1M ARR business from seed funding_ it 'd be a very
| compelling article still. Now the sourness comes from
| trying to redefine a term that has very concrete meaning
| without providing strong justification for doing so.
| ipaddr wrote:
| A 5 thousand dollar gift or loan? Or a trade of $5,000
| for a percentage?
|
| Bootstrap is a word with a specific meaning. It is not a
| spectrum it is a specific state of a spectrum.
|
| It sounds like ScrapeBee has more bootstraping elements
| than VC elements. It's a hybrid. Less VC pressures but
| still some.
| [deleted]
| threeseed wrote:
| Then you can say "ScrapingBee is closer to a bootstrapped
| company".
|
| That doesn't mean it actually is one though.
|
| And actually muddying what terms mean is the unhelpful
| part.
| rhizome wrote:
| The muddying is helpful...to them.
| rhizome wrote:
| I think at the end of the day people don't associate
| "bootstrapped" with "strangers' money." Of course the
| cofounder says the definition is "nuanced," because it
| would have to be in order for them to claim the
| descriptor, a descriptor that carries weight as a mark of
| independence. VC is not independence.
|
| They came from Tinyseed, why wouldn't _they_ use
| "fundstrapped?" Because it doesn't sound as cool, and
| they know VCs aren't cool as far as the independence
| denoted by the term "bootstrapped" goes.
| cjbgkagh wrote:
| It seems there are some definitions that allow for some
| external funding. I'm of the view that bootstrapped is no
| external funding; sounds like fundstrapped is a better
| term. Maybe seed funded.
| rglover wrote:
| > This is why Rob Walling (co-founder of TinySeed) likes
| to use the term "fundstrapped".
|
| My exact point. It's just wordplay.
| hooande wrote:
| Not sure why you needed the TinySeed money. It looks like you
| were only a few months away from $10k/mo, which seems near
| the boundary for sustainable income. Was there some
| investment you were able to make with the TinySeed money that
| pushed you over the line?
|
| Maybe I missed this in your post, but did you utilize search
| advertising? That seems to be the most common and effective
| tool for short term growth
| daolf wrote:
| So to be honest, we ran the math and never actually spent
| TinySeed money.
|
| We could have mathematically made without it.
|
| But three things to consider here:
|
| - TS money multiplied our runway by 10 and really reduced
| the amount stress we've experienced. Especially with COVID,
| during which we experienced our first negative growth month
|
| - We were able to finally pay ourselves above minimum wage
| (1,500$)
|
| - The mentoring and advices which came out of the program,
| really made the whole difference.
|
| Where we live, the startup ecosystem is basically 0, we
| don't know a lot of startup funders or experienced
| entrepreneur. It changes everything when you can ask a
| precise question about business and get a response from an
| expert in the next 6 hours.
|
| We had call with mentors and other member of the community,
| basically a one hour free consulting with an expert, about
| SEO, copywriting, recruiting, sales, growth, and marketing
| and THIS does move the needle a lot.
| jasode wrote:
| _> But to me, bootstrapping VS "VC road" is much more nuanced
| than this._
|
| I went to the _" TinySeed.com"_ website landing page and I do
| see that they prominently advertise _" The First Accelerator
| Designed for SaaS Bootstrappers"_.
|
| And then their FAQ page has these example financial terms:
|
| _> TinySeed invests $120k for the first founder, $60k for
| the second, and $40k for the third. Our standard terms are
| for 10-12% equity._ -- from
| https://tinyseed.com/program#program-faq
|
| Well, if founders accept those terms, they are no longer
| "bootstrapping" as people generally understand that word.
| Yes, you may have been bootstrapping right up to the point
| _before_ taking TinySeed $180k but after that _outside
| capital infusion_ , "bootstrapping" literally no longer
| applies. It doesn't seem like any nuance is necessary. It's
| quite a binary status.
| jt2190 wrote:
| I guess we can debate the existence of the "True
| Bootstrapper", but that's not a very interesting
| conversation.
|
| The term "bootstrapping" predates the existence of funding
| sources like TinySeed, and is now outdated. It was never
| terribly precise anyway, e.g. if someone saves up an
| "initial investment" amount of money before starting, are
| they bootstrapping? What about having a spouse who pays the
| bills while starting?
|
| The digital age has also introduced a whole new range of
| funding options that didn't exist very long ago,
| crowdfunding for example.
| jasode wrote:
| _> I guess we can debate the existence of the "True
| Bootstrapper", but that's not a very interesting
| conversation._
|
| I'm a language descriptivist not prescriptivist so I
| don't care to debate it but just pointing out that the
| founders are using "bootstrapped" in a confusing way that
| contradicts how others understand it. (Which then causes
| meta discussion of founders trying to educate readers on
| the nuances of what "bootstrap" means.)
|
| Compare the financial equity cap table terms to YC. When
| YC terms were $120k for 7% equity, people (generally)
| didn't call all those annual YC batch applicants
| "bootstrap companies". E.g. we (generally) did _not_ say
| "DropBox is a bootstrapped company", "AirBNB is a
| bootstrapped company". But TinySeed funding means it's a
| bootstrapped company?!?
|
| Doesn't that seem inconsistent?
|
| Taking outside funding from professional investors for
| equity stakes typically wasn't seen as _bootstrapping_.
|
| My point is that it's a whole heck of a lot easier if you
| shed the "bootstrap" label when the financial status
| changes. It's not a flaw or being evil to lose that
| label. Why is it so psychologically necessary to keep it?
| mritchie712 wrote:
| TinySeed != traditional VC
|
| The biggest problem most people have with traditional VC and
| thus prefer to "bootstrap" is the pressure to grow too fast.
| TinySeed has none of that pressure. Boostrapping vs VC is a
| spectrum and Scrapping Bee is clearly on the bootstrapped side
| of that spectrum.
| codegeek wrote:
| No. They got money in exchange for equity. If the company
| fails, they don't have to pay that money back. There is no
| personal guarantee from the founders. Bootstrapping means
| that you either used your own money or you got loans for
| which you are personally liable (credit card/bank loan/SBA
| etc).
| bonestamp2 wrote:
| I'm not OP, and maybe my understanding is wrong, but I always
| understood "bootstrapped" to mean they only put in their own
| money and didn't get any outside investments. Is there a
| better set of terms to differentiate between self funded,
| accelerator funded, and VC funded?
| dreig wrote:
| Looking at their MRR growth, it seems that they had ~$5K MRR in
| Spring of 2020, at the time they joined TinySeed. So perhaps a
| more technically accurate post would be: "How we bootstrapped
| to $60K ARR, then took a small investment and grew the company
| to $1MM ARR" ?
|
| When, in the lifecycle of the company, can you sell a small
| stake of it and still call it bootstrapped? Basecamp sold a bit
| of equity in 2006 to Bezos[1], and is still considered the
| epitome of the bootstrapped company.
|
| Additionally, if one has a couple hundred K after working at
| MANGA or wherever, or has wealthy parents/friends and uses that
| money to build their own start-up, is that still bootstrapping?
|
| To me, their journey is much closer to bootstrapping, and is
| quite an impressive achievement. Congrats, guys!
|
| [1]: https://m.signalvnoise.com/the-deal-jeff-bezos-got-on-
| baseca...
| YPCrumble wrote:
| This bootstrapping like how War is Peace, Freedom is Slavery,
| and Ignorance is Strength!
| sockpuppet69 wrote:
| noutella wrote:
| When people ask me why I like being the founder of a company, I
| often reply with a small story: when we built our first saas for
| SMB, we billed .50EUR per API call and we plugged those calls to
| a Slack bot. Man how great it felt in the firsts weeks when this
| bot would send a message around 20 times a day: the sound of
| finally having built something valuable that would generate value
| even if I'd be out of my computer, running or anything else
| really.
|
| Long live scrappingbee!
| sockpuppet69 wrote:
| daolf wrote:
| Co-founder here, thanks for the kind words.
|
| I totally agree, the $1 dollar you make online is really
| special.
|
| I know that, as a computer engineer, it really made us shift
| our whole mindset about what we do.
|
| We thought all we were able to do was to write code for someone
| else, we discovered that we could also sell a product and make
| a living out of it.
| azth wrote:
| Very cool. What's your backend stack written in if you're
| able to share?
| porker wrote:
| Congratulations!
|
| Q: Does ScrapingBee differ to Browserless.io? Or do they do the
| same thing? I've been out of the scraping scene for years
| (BeautifulSoup was new when I was doing it).
| daolf wrote:
| We close but different.
|
| Browserless allows have a fleet of Chrome in the cloud that you
| can use to run some browsing scenario.
|
| ScrapingBee is an API allowing to get the HTML of webpages by
| optionally rendering them inside a real browser, but also
| managing proxies, data extraction and JS scenario.
|
| Let's say we're cousins ;)
| throwthere wrote:
| Looks like things really kicked off once they joined Tinyseed.
| That's amazing!
| daolf wrote:
| Thanks a lot!
|
| Yes, TinySeed mattered a lot.
| akprasad wrote:
| Congratulations! Really wonderful to see small businesses and
| small teams succeed.
|
| As an aside, I'm curious if anyone has thought through the ethics
| of scraping through rotating proxies. Clearly the scraped website
| doesn't want mass scraping to occur, hence the need for proxies
| in the first place. What are the strong arguments in favor or
| against this?
| devops000 wrote:
| I suggest to add an HTML preview page in the API playground page.
| It would be easier to see what the scraper see on the webpage.
| toeknee123 wrote:
| Congrats, Kevin and Pierre on the success. You've all been such
| an inspiration and model for us in the TinySeed community.
| aantix wrote:
| For the "Growth finally kicks in" section - what was the primary
| driver of your traffic at that point? The increase is fairly
| pronounced, I wouldn't think that it was just a result of your
| content ranking higher?
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