Funding for Bootstrappers

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So the question is, it's like, I'd love to bootstrap and be on that path

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instead of taking VC, but like, literally, where do I get the first hundred K

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from to build something?

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I had saved money from my prior career. I was a trader for 10 years.

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If you do that, great. I understand that most people are not in that position.

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There are many other ways to actually get money that is not VC money, but I

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think are worthy of pursuing the problem is the VCs are going to be trying to

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give you money if your idea is decent and like avoiding that is hard because in

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the beginning, you're just like, I need whatever money I can get.

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So number one is do an exclusively friends and family angel round and explain

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to them that you were intentionally avoiding the VC route because you plan to

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do a, you plan to grow a profitable and growing software company, which is like

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not permitted in this VC world.

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And the types of people that will be drawn to this are the same type of people

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that would give you money if you started a restaurant, right, worst investment

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of all time restaurants.

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They're not betting on anything else other than you.

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The second way, which is how MailChimp got started was running a marketing

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agency.

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And they built the mail sending app as to like provide a service to their, to

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their marketing agency clients after like six or seven years.

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The mail app was bigger than the marketing agency so they turn the agency off

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and they proceeded Nathan Barry from convert kit, but he sold ebooks to fund

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convert kit, which is now 40 million a hour in the email space.

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Some other business, which is kind of what I'm doing with retention.com and RB

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to be it's like, if you can make money in another way to fund this, that is so

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much more desirable than getting on this VC treadmill.

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Number three, there's no shame and just like, this is kind of Gary V but it's

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there's no same as just keeping your job and doing like the night and we can

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hustle. And there's some arguments that you need to be fully in something.

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But like, I would argue that, man, like, in most cases stuff takes so much

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longer than you think to build and unless you're the actual engineer.

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You won't have full time work for a very long time. So getting as many of the

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co founders to actually keep their job as possible until this thing is going to

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make it is, is there's no shame in that just work nights and weekends.

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What I will say about what I did, which is fund it with your own money.

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I know a couple other people that started companies around the time I did, one

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of them had way more money than me, one of them had less. We all spent all of

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the money that was available to us on our startups.

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That's not necessarily a good thing. I put like a million bucks into mind. I

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think I could have gotten it off the ground with like 200k. If I had to have,

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it's this weird thing once you get in the position to where it's your last

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dollar you start getting a lot more creative with things and more money is not

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a good thing.

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I just think you're forced to create a much better business than when there's a

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lot of money sitting around. You have to have a higher bar for what a good

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product is what, you know, an acceptable sort of like sales motion is like you

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have to just be unbelievably efficient in everything you're doing.

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And try to like create the most money with the least amount of effort and do

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that over and over again as you scale your business up. That is not what

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happens when people take investor money.

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