Last week I attended Saastr Annual. An awesome event where 10,00 people in Saas gathered and shared learning over 3 days. In attendance, there seemed to be two different types of people:
- Those that want to get rich quick with; “the playbook” and seemingly not caring how they made money as long as they made a ton of it
- Those that started by wanting to solve a specific problem.
In the first category, people were talking about how to raise VC funds for the maximum valuation and how to grow as fast a possible (10x+ or bust). Some even talked about how to do an ICO (Initial Coin Offering) to raise money to grow their businesses (or to buy back their businesses from the VCs that they had overdiluted themselves to earlier). Both of those approaches require selling future dreams and tucking into peoples greed and speculative (high risk/high reward) investment tendencies.
I made a point of attending the sessions presented by founders of businesses that had bootstrapped for several years (up to 10) before seeking VC investment. They all seemed to fall into the second category. Obviously bootstrapped businesses have to provide value for customers that they are willing to pay for. These founders only sought investors when they had proven their businesses over the years and then had an opportunity to scale faster. To do more of what they were doing but doing it better.
Obviously bootstrapped businesses have to provide value for customers that they are willing to pay for.
I also noticed something about the physical appearance and manner of the bootstrapped founders versus the heavily funded founders.
The bootstrapped founders seemed healthier and happier
I know I am probably biased, but the bootstrapped founders seemed to have more of a balanced attitude to life and a commitment to the longevity of their business (and it’s employees and customers). They seemed healthier and happier. They talked about other aspects of their life that fulfilled them as well as their businesses.
On the other hand, the “go hard or go home” VC funded founders seemed to be sugar coating their presentations (there was a faint smell of BS) and they looked like zombies walking..