Guy Rubin is the co-founder and CEO of ebsta, a revenue intelligence platform that works with Salesforce and Hubspot to automatically analyze existing data to improve sales performance. Started in London in 2012, ebsta found success in the early days of the Salesforce marketplace and addon economy as a data tool integrated with customer emails. 

ebsta has since become a complete revenue intelligence platform, serving sales teams with 10-100 sales reps. With 400 customers, 30 employees, and no VC funding, ebsta competes with a focused approach to play in the massive Salesforce ecosystem and against huge competitors. 

Guy talks about their many pivots, running the business with his wife as cofounder, and the benefits and challenges of not being in San Francisco with VC funding. With deep data across thousands of sales reps, ebsta publishes an annual ebsta Sales Benchmark Report with specific data about close rates, quota attainment, and data-driven factors to improve sales performance. 

This week’s podcast is sponsored by Full Scale, one of the fastest-growing software development companies in any region. Full Scale vets, employs, and supports over 300 professional developers, designers, and testers in the Philippines who can augment and extend your core dev team. Learn more at fullscale.io.

Quote from Guy Rubin, CEO of ebsta

“We found ourselves in a place where we had some amazingly talented, very driven, very focused doers, and they were happy to work together as a common goal and get stuff done.

“What moved the bar for me as the CEO was bringing on board advisors. I’ve now got four board advisors and a chairman sitting around me. We also brought on a CTO, CPO, and CFO, who are very experienced.

“So bring in those experts around you, people independent of those doing the doing. Don’t get me wrong; you need the doers. They’re absolutely vital, but I also needed experts to help me at the running stage.

“That was the best thing I ever did: bringing those expert advisors in. And if you’re small, I would encourage founders to ask different people to be advisors to give you an outside perspective.  You’d be surprised if people love being asked for help and ask you some difficult questions.”

• Guy Rubin on LinkedIn
• ebsta on LinkedIn
• ebsta website
• 2024 ebsta SaaS Sales Benchmarks Report

Tune into the Practical Founders Podcast for weekly in-depth interviews with founders who have built valuable software companies without big funding. Subscribe to the Practical Founders Podcast using your favorite podcast app.

Stuart Draper founded Stukent, an innovative ed-tech company that provides simulated internships for business students. Stukent started by focusing on high-quality digital marketing education for colleges and universities using up-to-date digital textbooks and content. They then added a simulation system for students to practice their digital marketing skills.

Stukent grew steadily with less than $1M in outside funding, which helped them bridge the long and seasonal buying cycles of big schools. The team grew to over 100 employees and nearly $10 million in revenue serving marketing professors and their students. 

In 2021, they engaged with Vista Point Advisors, an M&A advisor firm, to shop the company to prospective buyers and investors, eventually getting a majority investment from Tritium Partners. Stuart describes the M&A process, what worked well, and how he transitioned out of the company after two years of continued growth. 

This week’s podcast is sponsored by my friends at Cypress Growth Capital. For 15 years, Cypress has provided non-dilutive growth funding to bootstrapped SaaS founders, including many successful founders I’ve interviewed here on this podcast.

Quote from Stuart Draper, founder of Stukent

“When we officially sold a major part of our company to investors, we had a brief celebration. My CFO and I called each other and screamed as loud as we could on the phone in a fun moment. We got there, we did this. My family also took a big trip and I got a break.

“But then it was back to work. I was still the CEO and I still run this thing and I’ve got new investors that also need returns. I’m going to go deliver for these guys. They gave me a big payday, so I’m going to make sure they have a win too.

“After the second board meeting with our investors, I realized this is way harder than I thought. After eight board meetings and doubling the business again, I wasn’t enjoying this as much anymore. The board meetings were hard for me. Prepping for them was super stressful.

“So we found a new CEO for Stukent, and he’s doing great. Now I get to sit back in my chair at the board meeting, listen in, share my advice and opinions and come back in three months.”

• Stuart Draper on LinkedIn
• Stukent on LinkedIn
• Stukent website
• Tritium Partners website

Tune into the Practical Founders Podcast for weekly in-depth interviews with founders who have built valuable software companies without big funding. Subscribe to the Practical Founders Podcast using your favorite podcast app.

Ian Manners was a successful consultant for pharmaceutical companies in the US when he discovered a major problem that needed a software solution. Big pharma companies provide financial assistance funding for patients who require their drugs but struggle with high costs, but these funds are difficult to access and manage for patients and healthcare providers. 

Ian and his cofounder created Vivor in 2014 to connect this financial assistance funding to patients through healthcare providers like hospitals, medical offices, and healthcare networks. The bootstrapped software startup grew slowly at first but eventually became profitable as it scaled up. Since inception, Vivor has helped over 100,000 patients receive over $2 billion in financial assistance to offset the high costs of prescriptions. 

During the COVID crisis that hit the US healthcare industry, Ian decided to merge Vivor with TailorMed, a VC-funded competitor, in a cash and stock deal. He stayed on for two years during the transition and is now looking for his next entrepreneurial adventure in healthcare software. 

“The overall idea of merging our companies and having stock and some cash in our acquisition structure made sense for both parties. If the company that’s acquiring your company is huge and they’ve got big cash reserves, they buy someone out. But if you’re combining with another startup, that cash is precious. They don’t want to spend all of it. 

“So it really makes sense to do a combination of the two and to include equity in the deal. I think that part was absolutely a win-win, even when, as you’re going through that process, you negotiate all the details.

“It’s a huge bet for us to take equity as part of our deal, We became an investor in the company that bought us.. I think for anyone facing something similar, my advice would be to just slow down that part of it and really think about and digest the fact that you’re becoming an investor in the combined company. “

• Ian Manners on LinkedIn
• Vivor website
• TailorMed on LinkedIn
• TailorMed website

Tune into the Practical Founders Podcast for weekly in-depth interviews with founders who have built valuable software companies without big funding. Subscribe to the Practical Founders Podcast using your favorite podcast app.

Seth Radman created, grew, and sold two music app startups in his twenties. A saxophone player in his college marching band, Seth was passionate about helping musicians and school band directors to improve how they learn music using technology.

Seth was the founder and CEO of Crescendo, an interactive music trainer that provides real-time performance assessment feedback using acoustic pitch detection and machine learning as a mobile app. With a little angel funding, Crescendo grew to over 1M users and 7,000 schools before being acquired by Ultimate Guitar in 2018.

He was also co-founder and CEO of Upbeat, a bootstrapped startup providing a virtual music collaboration platform for school music departments. When schools shut down during COVID, Upbeat allowed musicians to rehearse and perform music virtually with others in real-time without sound delays. Upbeat grew to over  200,000 users in 12 months and was purchased by 5,000 schools before being acquired in 2021 by MakeMusic.

"Having a company acquired seemed like this big elusive goal that every founder wants to achieve. And then I did it. And then I wasn't sure what to do next at all, I was completely shocked on the first day," Seth says. 

"I say it was one of the happiest days of my life when I saw the money hit the bank. And then the day after, that was probably one of the most depressing days of my life, because I was like, whoa, what do I do now? I definitely thought there was a little bit of loss of identity for me going through that.

"And I spent the next several months kind of doing nothing. I was honestly just depressed. I just felt super lost and was not sure what to do. And that was a really tough period. "

In this episode, Seth explains:

• How he had hundreds of product ideas, did hundreds of customer interviews, and ran dozens of experiments to eventually find problems that customers would actually pay to solve
• What product-market fit really means to him and why it's so important to experiment before you invest lots of time and money
• Why he felt that he wasn't the right person to scale up his first company and the deep anxiety he felt when he successfully sold it
• How he's managing the emotional ups and downs of being an entrepreneur now after experiencing mental health challenges
• How he leveraged an existing customer base and channel to rapidly grow his second startup as COVID lockdowns created an acute problem in the music teaching industry
• How he developed a strong persistence habit as a musician that helped him do hard things every day that he didn't want to do

Dougal Cameron created Golden Section to provide support and practical funding to SaaS founders with deep experience in select vertical markets. Their founder-first approach is different than the traditional VC or private equity investment model which often doesn't work out well for founders in the end.

Dougal's family had been investing in software companies for over 20 years through their Houston-based family office. Now Golden Section includes a founders studio for venture development, a world-class software product development service, and optional equity funding for B2B SaaS founders with deep domain experience in their industries.

This is an example of one of many possible ways that funding can be practical and helpful for founders who want to accelerate growth but don't want to play the unicorn-hunting grow-or-die game required by most venture capital investors.

"Our capital needs to look very different than the traditional venture capital side, where 66% of the time venture-backed founders make nothing when their company sells. And that's companies that get to an exit," says Dougal.

"I think that's a horrible statistic that really reveals some of the problems in the venture capital industry. It doesn't make a ton of sense for founders who see a clear problem that they know very well and they know people are going to buy their solution."

In this episode, Dougal explains:

• Why traditional venture capital investment is not a good fit for certain kinds of software businesses
• The hard lessons he has learned from years of investing in software companies and running software companies himself
• How they have designed their investment model to support founder-friendly exits where everyone can win: founders, investors, employees, vendors, and customers
• How they provide deep support for the founders they partner with, including software development services, growth advisory, and execution advice in every aspect of the company
• What Golden Section does to support the brutally hard emotional journey that all founders go through as they grow their companies

Find the show notes for this episode at practicalfounders.com. 

Sean Meister was a sales professional and leader with a successful career selling hospital and medical supplies before he left to join his long-time friend who had a vision for a new software company serving smaller trucking fleets with simple GPS-tracking fleet management software.

Sean was a co-founder and COO of M2M in Motion, a self-funded software company based in the Chicago area. Sean wasn't the trucking industry expert, the crazy entrepreneur, or the visionary salesperson. He provided the savvy help to get the company started and the operational leadership to build a scalable sales team, reliable product development, and quality customer operations.

M2M in Motion was bootstrapped with founder funding, then customer funding (revenue), to grow to over $5M in revenues before being acquired in 2021 by a larger vehicle telematics company, AAMP Global. M2M in Motion allowed small and mid-sized fleets to track their vehicles with a simple software solution and GPS-tracking devices.

"I think another reason we were successful is that we identified our ideal customer profile early, and we owned it, and then we really targeted that. In the beginning, you're just so desperate for anything, that you don't realize you're actually hurting yourself," Sean says.

"I think that was a big lesson for us. When you can start saying NO is when your trajectory starts taking off."

In this episode, Sean explains:

• Why he quit his successful sales career to join his long-time friend who had an idea for a software startup in the transportation technology industry
• How long it took to get to breakeven revenue after spending their personal savings to get the company started
• How the US "ELD" government trucking safety mandate helped them grow fast
• How they introduced device financing to bundle the GPS-tracking hardware and software for a simple monthly fee
• How they successfully competed in a very active, well-funded industry as a small, bootstrapped company by keeping things simple and narrowing their focus
• How their multi-channel growth strategy included "white-labeling" their software to strategic reseller partners and how one of those relationships led to their acquisition

Check out the show notes and links for this episode at practicalfounders.com. 

Thomas Brown creatively bootstrapped his software company and ran it as a very small "lifestyle" business before committing to growing his SaaS business with a larger team.

Thomas was an independent insurance claims adjuster in the 1990s in New Orleans, Louisiana before quitting his job to start one of the first insurance claims management software companies called ClickClaims. It grew slowly and profitably as a very small company for over 10 years before Thomas sought help from advisors to see how he could grow to the next level and learn to be a real CEO of a bigger SaaS company.

E-Claim is now a steadily growing vertical SaaS business with 18 employees and over $4 million in ARR. They have helped independent insurance adjusters and insurance carriers process over 2 million claims with their ClickClaims product since he started the company in 1999.

"I know this sounds cliche, but I didn't get into this for the money. I got into it because I'm a guy from South Louisiana who's been through a bunch of hurricanes and knows the horrors that people go through. And I wanted to make it better. So you reach a point in the business where you start to think about not what it means for you, but what it means for others. What can you do for your employees and their careers? What other charities can I go and support with this money someday? And then you think about it, and you say, you know, hell, I want to double it, because I could do a lot of good with a lot more money."

In this episode, Thomas explains:

• How he started his company and built a software solution after experiencing a massive industry problem himself
• How he grew a $4M+ ARR SaaS company without funding with just 50 customers
• Which creative side businesses he started to generate enough cash to build and start his software company
• How trusted business advisors helped him gain the knowledge and the confidence to be the SaaS CEO and team leader required to keep growing his company
• Why he is inspired to make a bigger impact with his employees and in his community by continuing to grow his business

Nick Santora bootstrapped Curricula for 4 years with his co-founders before raising $3M in practical funding and then getting acquired in 2022 for $22 million.

Nick and his co-founders quit their jobs to build innovative story-based education courses and a single-purpose learning platform for cybersecurity security awareness training. Nick had found a big hole in the cybersecurity market while working as a cybersecurity trainer in the electric utility industry.

Curricula features fun and engaging training content, which was the opposite of the typical "death by Powerpoint" training that users ignored. Now Curricula is a powerful platform that allows companies to create their own engaging content and then measure custom training results.

When they almost ran out of cash before revenues grew, Nick says. "I would do anything I could do to keep this heartbeat going instead of getting an investor to run our future. Once that starts happening, I knew it was going to start cascading into desperation. And I wanted to hold the cards in our hands as long as we could."

In this episode, Nick explains:

• How he saw this problem as a cybersecurity trainer in the electric utility industry
• How he and his cofounders quit their jobs to build this platform while living on savings and no salary
• What happened when they ran out of money three times while pivoting and experimenting to find their growth path
• How they used freemium PLG tactics to compete with an aggressive competitor who had raised $80 million in VC funding
• How his last-ditch promotion test with LinkedIn advertising created their primary efficient customer acquisition tactic
• Why he didn't raise money from VCs but instead raised from a practical investor who had grown and sold a bootstrapped company

Check out all our podcast episodes at https://practicalfounders.com.

Jeremy Clarke created, grew, and sold his software company in a most unusual and successful way:

He grew WebMerge to $4M revenue by just himself in 6 years before hiring his first and only employee, a strategic sales rep. It's an incredible "bootstrapped unicorn" success story that ultimately was worth $100M when he sold WebMerge in 2019.

WebMerge was an online service that automates document creation to automatically fill in any documents with merged data from any source. WebMerge automatically generates PDF and Microsoft Word documents. Think of it as "mail merge for the web."

Jeremy's first employer, Formstack, ultimately acquired WebMerge to bring Jeremy back to the Formstack team and renamed the product to Formstack Documents.

In this episode, Jeremy explains:

• How he came up with the idea and pitched it to his employer before building it on his own
• How he grew revenues to $1M ARR before he quit his day job as a full-time software programmer
• What it was like to grow a $5M+ ARR SaaS business without  any other employees or Slack groups or constant meetings
• How many years in a row he raised prices before he found the right price
• How he grew awareness and conversion efficiently by integrating with other apps and appearing in their add-on marketplaces
• What it was like to sell his company to a private equity (PE) buyer in two phases

Check out all our episodes and articles at https://practicalfounders.com.

Luke Hohmann was an engineering and product management leader at Silicon Valley startups before he became an acclaimed author and speaker in the enterprise software development world. He used funding from his consulting business—plus revenue from his first big customers—to build a new software product called Conteneo.

Conteneo was enterprise collaboration software that enabled the biggest companies to engage their leaders in new ways to make much better decisions about product portfolio investments. Started in 2010, this idea came out of several of the gamified collaboration exercises Luke used in his consulting business. Conteneo software customers include Adobe Systems, Cisco, Emerson, HP, Rackspace, and Reed Elsevier.

As the Conteneo software business grew, their consulting business shrank. Eventually, Conteneo was acquired by a strategic partner who was also a leader in enterprise software development and innovation, Scaled Agile. Conteneo was rebranded as SAFe Collaborate.

"One of the important lessons for any practical founder is this: Instead of thinking of investors as your first source of funding, look to your first customers," Luke says.

In this episode, Luke explains:

• How his biggest consulting client asked him to build their proven collaboration process into a SaaS software product.
• How he funded the initial development and subsequent features with creative customer contract commitments.
• Why his little, bootstrapped company was successful in selling to the largest software companies in the world in the heart of Silicon Valley.
• The bet he won with a funded founder friend about who would end up with the biggest prize when they sold their companies.
• The crazy story of how a well-known business author offered to invest in his company over a handshake at a conference.
• Why he thinks founders should have a structured advisory board and pay them instead of just having informal advisors.

Check out all our episodes and articles at https://practicalfounders.com.

Steve Gelley created two successful businesses and learned important lessons before he and a cofounder self-funded a third startup that was acquired in only 18 months for a big prize.

Steve started his entrepreneurial journey by buying, improving, and then selling CPA accounting services firms in the Eastern U.S. Then he grew his first VC-funded tech startup, Xendoo, to innovate in the small business accounting services space.

He exited Xendoo and worked with a partner to fund and create a new startup called wemlo to automate the manual process of processing mortgage loans for mortgage brokers. Only 18 months from starting, including four strategic pivots, Steve and his cofounder, David Rogove, sold wemlo to a strategic buyer owned by RE/MAX.

Steve says, "Nobody tells you that founders end up spending so much time on funding and the optics of the dog and pony show that no one's running the business. It's actually counterproductive."

In this episode, Steve explains:

• Why he sold his interest in his first startup when the company achieved its first VC funding
• How he and his cofounder built a market-leading solution for a massive industry with a small team
• What the true opportunity cost of raising VC funding is for founders growing vertical software companies
• The simple math that showed him raising big funding would not be better for the founders
• What it takes to design revolutionary software with automated processes that revolutions
• Why he says "timing is the luck factor in a business," especially when you exit a business
• Why money from investors won't solve all your problems and often make things worse

Check out all our episodes and articles at https://practicalfounders.com.

Hamid Shojaee is a technical founder and serial entrepreneur who created several software companies and dozens of products in the last 25 years. He sold his two software companies in 2021—Axosoft and Pure Chat—and now is an active investor and has a new startup to keep him busy.

Axosoft was popular project management and bug-tracking software for developers that he bootstrapped to launch in 2002. It grew profitably for years until it met stiff competition despite active efforts to grow. Dozens of product experiments finally produced a hit, the popular software GitKraken.

In this episode, Hamid shares some hard lessons learned:

• How he and his team experimented to test new product ideas and don’t invest until they prove real user traction (DAUs)
• The challenges of raising money from investors who want faster revenue traction too early in the product-led growth cycle
• The challenges of not being the dominant leader in your market in the long-run
• Selling one business to a strategic buyer without help: selling the other business to a financial buyer using M&A investment bankers
• The modest changes in his life after selling two companies for life-changing wealth in 2021
• Why he’s starting and building another software company

Check out all our episodes and articles at https://practicalfounders.com.

Dan Jaffe is the founder and CEO of LawLytics, a popular website marketing platform for small law firms. Dan was a practicing lawyer before he became an internet entrepreneur with his first venture, which he sold before he started LawLytics in 2012. LawLytics was acquired by the Australia-based Smokeball-LEAP-InfoTrack Group in 2021. Dan is still growing LawLytics as its leader of the acquired company.

LawLytics is a website platform for small law firms who want a successful website but don’t want to overpay an agency or struggle with software that isn’t built for them. LawLytics has templates, designs, and lead-generation tools specifically designed for lawyers to generate business efficiently. 

In this episode, you’ll hear how Dan:

• Transitioned from being a practicing trial attorney to an internet entrepreneur and SaaS founder
• Created and sold his first business, an online law firm directory
• Self-funded LawLytics then added small investments from angels and a local seed fund
• Found a technical co-founder by networking in San Francisco
• Competed with bigger competitors to deliver a successful  website marketing platform for attorneys
• Grew to over 30 employees and contractors, then successfully sold the business in 2021 with the help of an M&A investment banking firm

Check out all our episodes and articles at https://practicalfounders.com.

Dave Lambert and the team at Right Side Capital Management are the most active venture capital investors, having invested in over 2,000 startups since 2009.

Right Side Capital is a “pre-VC” institutional investor that operates very differently from traditional VCs: investing when SaaS companies have just a little revenue using a submission form on their website, then responding quickly and making investment decisions in a week. They also invest in practical SaaS founders with capital-efficient approaches who expect to sell their companies someday for less than $100M.

In this expert episode, Dave shares practical insights for SaaS founders who don’t expect to play the big VC funding game:

• Why raising Series A or B funding rounds from VCs reduces your odds of a successful exit
• What founders should be focused on when they get their first customers and revenue
• Why most VCs don’t invest when you have just a few customers and a little revenue
• How the founders they invested in are using AI technology to grow more efficiently
• What’s happening right now with acquisitions of SaaS companies for $25-$100M enterprise value

“More often than not, at the stages that we’re investing and someone has $4K, $8K, $20K MRR, the founders are still supremely confident and think they figured out their exact ICP and how it’s going to grow in scale. They think, We’re just going to take your money, and it’s going to be straight up from here. And it never does, or almost never does.

“We’re having conversations with founders where we’re sharing, Hey, just so you know, 90% of our companies miss their revenue targets massively in their first year. So you should assume that you are going to as well.

“But guess what? They all spend exactly what they thought they were gonna spend or more, usually. Just know that that’s gonna be the case and have a plan for where you’re still alive if things don’t go as expected.”

• Dave Lambert on LinkedIn
• Right Side Capital Management on LinkedIn
• Right Side Capital Management website

Tune into the Practical Founders Podcast for weekly in-depth interviews with founders who have built valuable software companies without big funding. Subscribe to the Practical Founders Podcast using your favorite podcast app.

Rafael Zimberoff was CEO of ShipRush, a software company he founded in 2001, then grew, and eventually sold in 2017 to Descartes Systems Group for $17 million. Rafael started ShipRush as an add-on product for popular CRM and accounting software and was a pioneer in shipping technology for small businesses.

ShipRush is now a comprehensive shipping platform for small ecommerce providers so they can easily process shipment orders and carrier labels for USPS, Fedex, and UPS. ShipRush integrates with popular ecommerce and accounting platforms, including Shopify, Amazon, eBay, Quickbooks, and more.

In this episode, you'll hear how Rafael:

• Boostrapped his tech services company to fund their first software product then grew without outside investors
• Created a popular add-on software product for bigger software ecosystems as an efficient way to find customers and grow revenues quickly
• Managed complexities of being an early pioneer in shipping technology working with large carriers like Fedex, USPS, and UPS
• Ran a profitable software company for more than 15 years with a small and amazing team
• Learn hard lessons then succeeded in working with M&A investment bankers to sell his company

Check out all our episodes, articles, and resources at https://practicalfounders.com.

Jonathan Cronstedt, also known as JCron, was the president of Kajabi software from 2016 through 2021 as he helped the company grow past the early startup years. JCron is a savvy entrepreneur, digital marketer, and sales leader who shares the story of the bootstrap founding of Kajabi through getting $550M in venture capital funding in 2021.

Kajabi is a leading "knowledge commerce" platform for experts and entrepreneurs to market and sell their expertise as online content. Started in 2010 to help early internet marketers and small business experts deliver videos and training, Kajabi has helped over 30,000 creators to sell their expertise and expand their businesses.

In this episode, you'll hear how Kajabi:

• Had $1M+ annual recurring revenue the moment the product launched after coding on nights and weekends for a year to create the first product
• Founder and CEO Kenny Rueter grew revenues ahead of expenses to stay profitable from day 1 to over $50M in revenue 10 years later
• Grew as a modest software business for the first 5 years, then rebuilt the product to grow the business much bigger as the market eventually grew up in the next 5 years
• Kept a fanatic focus on their target customer (called “Kajabi heroes”), a powerful and easy-to-use product, and a well-defined culture
• More than doubled in size in 12 months during the COVID crisis when online courses and content became a global focus
• Waited 10 years to take any outside investment in 2020 that helped bring the expertise to scale, then raised $550M at a $2B valuation from VC investors in 2021.

Check out all our episodes, articles, and resources at https://practicalfounders.com.

Todd Watson is the owner and CEO of Showit, a popular no-code website builder and platform for designers and photographers. Todd is a native of Phoenix, Arizona where he started as a videographer before joining a friend in 2006 to create a scrappy software business that made inexpensive photo-presenting and sharing tools for photographers.

The Showit company was created when Todd took one of their two products and half the small team in 2010 to spin off Showit as an independent business. The small revenue from the small customer base and his own savings allowed them to rewrite Showit for the cloud and then continue their fanatic customer focus to keep growing every year.

Now Showit is used by 35,000 designers, photographers, and small businesses as their website platform using its elegant “Photoshop-like” no-code visual builder. The Showit company is growing quickly every year and is profitable, yet Todd has no interest in taking outside funding or selling his beloved company.

In this episode, you’ll hear how Todd and the Showit team:

• Spun off Showit from a small software company, then rewrote the software from old Flash technology to new cloud software
• Serve and love their customers to create a fanatically loyal community that is expanding quickly without expensive marketing
• Recruit, engage, and empower their employees in creative ways that no funded software company ever would
• Never think about external funding or selling the company despite the company’s extraordinary value and potential
• Started with a fanatic niche focus on an underserved community and then expanded its market as the community grew

Check out all our episodes, articles, and resources at https://practicalfounders.com.

Todd Watson is the owner and CEO of Showit, a popular no-code website builder and platform for designers and photographers. Todd is a native of Phoenix, Arizona where he started as a videographer before joining a friend in 2007 to create a scrappy software business that made inexpensive photo-presenting and sharing tools for photographers.

The Showit company was created when Todd took one of their two products and half the small team in 2010 to spin off Showit as an independent business. The small revenue from the small customer base and his own savings allowed them to rewrite Showit for the cloud and then continue their fanatic customer focus to keep growing every year—without any outside funding.

Now Showit is used by 50,000 designers, photographers, and small businesses as their website platform using its elegant “Photoshop-like” no-code visual builder. The Showit company is growing quickly every year and is profitable, yet Todd has no interest in taking outside funding or selling his beloved company.

• Todd Watson on LinkedIn
• Showit website
• Showit website design marketplace:
• Showit on LinkedIn

Tune into the Practical Founders Podcast for weekly in-depth interviews with founders who have built valuable software companies without big funding. Subscribe to the Practical Founders Podcast using your favorite podcast app.

Erin Fletter had a long career in the restaurant business before starting an after-school enrichment program to teach kids how to cook at her daughters’ school in 2011. Her cooking program became popular, and she improved and expanded it to become a paid program called Sticky Fingers Cooking. Soon, she had a sizable business with over 100 chef-instructor employees who conducted engaging classes daily in Denver.

Her team created custom software to help manage their complicated operations, from enrolling students, coordinating instructors, and building relationships with schools to handling payments and payroll. The software grew slowly initially but eventually became a powerful system that helped them scale their business and run efficiently. 

Erin considered turning her business into a software company, as many tech-powered businesses do. Instead, they kept improving the software and expanding operations, serving over 100,000 students and thousands of schools and venues. Now Sticky Fingers Cooling is a fast-growing and successful franchise business with a software superpower. 

Quote from Erin Fletter, CEO of Sticky Fingers Cooking

“Our business has a lot of logistics, coordination, and operations. Our own custom software, we call it the Dash, it takes about 85% of all operations off the table for humans. This enables our chef-instructors to connect with their students and our franchise owners and regional directors to focus on building relationships with schools and parents.

“Over the years, we have been contacted by very large organizations like YMCAs, Boys and Girls Clubs, and other after-school enrichments about our software. They would see our automatic rosters getting texted and emailed at the venues that we were teaching in, and they asked, What are you using? What is this? And we told them, Well, it’s our own software, sorry. 

“We had talked for years about selling our software as a white-label solution because the demand is there. We’ve had inquiries for the last 10 years. That was a direction we could have taken. 

“But I’m just laser-focused on Sticky Fingers Cooking. It’s a very simple business, and our technology helps us do it incredibly well. We want to be the best at what we do. I didn’t really want a diversion from the path of taking our business national through franchising.”

• Erin Fletter on LinkedIn
• Sticky Fingers Cooking on LinkedIn
• Sticky Fingers Cooking website

Tune into the Practical Founders Podcast for weekly in-depth interviews with founders who have built valuable software companies without big funding. Subscribe to the Practical Founders Podcast using your favorite podcast app.

In this second of two episodes, Practical Founders Podcast host Greg Head discusses the next five important things venture capital investors don’t tell new SaaS startup founders. Greg emphasizes that VCs invest in very few businesses and seek big wins. He highlights the importance of understanding the game of venture capital funding and the alternatives available to SaaS founders.

Check out last week’s episode, in which Greg discusses the first five things that VCs don’t tell SaaS startup founders about raising VC capital.

“Professional VC investors are expecting very big results when they invest. If you sell a piece of your company to get a $5 million Series A investment, that typically ends up being about 20 percent of your equity. So you’ve just valued your company after funding at about $25 million.

“$25 million is the point where the venture capital investor comes in, so you can’t sell your business for $30 million or $50 million anymore. That wasn’t why the VC invested. They probably don’t even want you to sell your business for $75 million. That’s just a 3X exit.

“That’s not what they invested their precious cash. They’re going for a 10x or 20x exit. So even when you just take $5 million from VCs, you can’t sell your company for less than $100 million and have everyone win. You have to sell for $500 million or more for everyone to be happy, including the founders.”

• Greg Head on LinkedIn
• Practical Founders website
• Practical Founders Podcast
• Greg Head’s blog
• Part 1 – The 10 Things that VCs Don’t Tell Startup SaaS Founders – Greg Head

In this episode, Practical Founders Podcast host Greg Head discusses the most important things venture capital investors don’t tell new SaaS startup founders. He emphasizes that VCs invest in very few businesses and are looking for big wins. Greg highlights the importance of understanding the game of venture capital funding and the alternatives available to SaaS founders.

“If you’re thinking about raising VC investment, do your homework so you know what you are signing up for before. VCs are not evil people, and it’s not a bad business model—for them. 

“The world has changed for SaaS founders in the last 5-10 years, and it’s still changing. You no longer need VC funding to start most B2B SaaS software companies. It’s 10 times cheaper to create a sellable SaaS product and go to market now. And founders can get higher multiples earlier when they sell their companies. VC funds are also much bigger, so it’s riskier for founders to play that game.

“You just don’t need to make a crazy all-or-nothing bet that your company will create a billion-dollar exit in seven years, which VC investors require to win. The best case scenario for 80 to 90 % of software companies is NOT to raise big institutional venture funding.”

• Greg Head on LinkedIn
• Practical Founders website
• Practical Founders Podcast
• Greg Head’s blog

Tune into the Practical Founders Podcast for weekly in-depth interviews with founders who have built valuable software companies—without big funding.

Subscribe to the Practical Founders Podcast using your favorite podcast app.

Mike Trasatti spent 10 years in the automotive dealer software business before he found an auto dealer in Iowa who had built is own complete software system. They partnered up in 2008, and Mike became the first CEO of the spinout software company, DealerBuilt.

DealerBuilt grew slowly as a bootstrapped startup in a market full of large incumbent competitors. They had a better approach to managing multiple dealers in a group with their dealer management system (DMS). DealerBuilt is powerful software that manages the entire financial operations of an auto dealer in the US. 

They grew steadily to 450 dealer customers and 100 employees in 10 years before deciding to partner with ParkerGale, a private equity investor, to help them with their next growth stage in 2019. Mike continued as CEO until 2023, navigating through the COVID years and acquiring several “tuck-in” products to extend the DealerBuilt solution. Mike is now an independent advisor to DealerBuilt and other organizations. 

“You’re constantly challenged in the entrepreneurial world. Do you really know what you’re doing? Self-doubt can be tremendously harmful to CEOs. I don’t think you can get into this business without a strong image of yourself and real confidence.

“But you have to balance confidence with humility because you’ll make mistakes. You’re going to have setbacks every week, and some very big ones, too. You can’t lose enthusiasm: You need enough confidence that you’re on the right path and that will carry you more than anything else. Those who don’t lose enthusiasm win.

“When you have both confidence and humility, you won’t be afraid to be around people who are better than you. And you’ll feel comfortable in that space, leading smart people who are championing your journey. They will look at you and think, I want to be there with you to champion this for you. That’s success as a leader.”

• Mike Trasatti on LinkedIn
• DealerBuilt on LinkedIn
• DealerBuilt website
• ParkerGale website – private equity investor in DealerBuilt

Tune into the Practical Founders Podcast for weekly in-depth interviews with founders who have built valuable software companies without big funding. Subscribe to the Practical Founders Podcast using your favorite podcast app.

Brian Abernethy, founder of Utopaya, is an expert in helping SaaS leaders navigate the complicated process of adding payments monetization to their product offerings and business strategies. With a long history in the payments industry, Brian has worked with hundreds of early-stage SaaS leaders and their investors to optimize their payments strategies.

In this expert podcast interview, Brian explains the basics of payments monetization for practical SaaS founders, answering questions like these:

• When should SaaS companies consider monetizing payments and when is it not a good fit?
• What are the first steps to adding a profitable payments offering to your SaaS product?
• What’s happening in the payments industry to make it easier or harder for SaaS companies?
• How do investors value payments offerings in a SaaS business?
• What are the biggest misconceptions and mistakes that SaaS companies make when get started with payments?
• How can SaaS businesses lower their payments bills for the credit card customer they take from their customers?

Quote from Brian Abernethy, principal at Utopaya
“Most software companies are looking to include some type of fintech offering. Payments is typically the first one of those. These software companies want to own not only the bigger portion of revenue, of course, but also mprove the customer experience.

“Recent consolidation in the fintech and payments industry has created new options for SaaS companies to monetize payments. The big payments providers are now much bigger and have moved upmarket, creating a gap. Many new payments players are designed for smaller SaaS companies, with purpose-built platforms, APIs, and more support for integrated software solutions.

“There are more compelling solutions for SaaS companies to launch truly white-labeled, profitable, and easier-to-implement payments solutions. Also, the market data show that it does positively change the customer experience, so these smaller payment companies are winning share at a fast clip.“

• Brian Abernethy on LinkedIn
• Utopaya on LinkedIn
• Utopaya website

Tune into the Practical Founders Podcast for weekly in-depth interviews with founders who have built valuable software companies without big funding. Subscribe to the Practical Founders Podcast using your favorite podcast app.

Jeff Corn is the co-founder and former CEO of Virtuance, one of the US's leading real estate photography and marketing providers. In 2010, Jeff was in the real estate investment business and wondered why it took $10,000 and nearly a month to get professional photos for new listings. He and a cofounder started taking photos to serve busy real estate agents to learn what was needed and improve the quality and speed of delivery with technology. 

Virtuance started with the vision of a software-only solution, but the business started growing with a high-quality, done-for-you service with a fast turnaround, powered by its technology, partners, and systems. The company grew steadily every year without any outside funding to eventually serve more than 20,000 real estate agents with 100 employees and more than 300 local photography partners.

This tech-enabled services company has SaaS-like gross margins. re-occurring revenue, and some profits In 2022, Jeff successfully sold Virtuance to Diakrit, a global real estate marketing technology company backed by private equity investors. Jeff stayed on for two years after the sale, until last month.

Quote from Jeff Corn, co-founder of Virtuance
“The biggest reason that founders fail is that they actually fail to launch. The hardest thing to do is to fricking push your product and get it out in the world– because it’s messy. It’s certainly far from perfect, and it may not even work very well. But getting that feedback is so important to figure out what to do next.

“I see too many founders try to perfect it before they get it into the market. And then when it gets into the market, they might think it’s perfect, but the market may not. And at that point, they already invested too much in it. It’s not that we’re shipping something that we don’t think works; we are shipping something that we know checks just one of the boxes that our customers need.

“It’s just human nature that we want to put out good work, we have pride in our work. It’s one of the one of the real paradoxes of entrepreneurship is that we are all perfectionists and Type A personalities. We want to control it and we want it to be right, but also to be successful. The only way to succeed is to let go of some of that, to allow our teams to do the work, and be able to ship an imperfect product to get real feedback.”

• Jeff Corn on LinkedIn
• Virtuance on LinkedIn
• Virtuance website
• DIAKRIT website

Tune into the Practical Founders Podcast for weekly in-depth interviews with founders who have built valuable software companies without big funding. Subscribe to the Practical Founders Podcast using your favorite podcast app.

Adam Haynes is a managing director at GLC Advisors, an M&A advisory firm that helps bootstrapped founders to successfully sell their companies. The software advisor team at GLC has been working with practical software founders for over 15 years and has completed over 100 software transactions. 

In this expert interview, Adam shares:

• What has changed in software acquisitions in the last 20 years and recently through 2024
• What are the valuation ranges and factors for practical SaaS companies under $10M revenue
• The 7 key areas that founders should be working on several years before an acquisition
• When should a SaaS founder consider using an M&A advisor

Quote from Adam Haynes, M&A Advisor at GLC Advisors
“When you are selling your company and the buyer is looking at all your challenges and problems, founders should know that deal breakers are very rare. Buyer and seller want to get a deal done, and there are ways to navigate around them. 

“You can’t have a software company without tech debt. That’s okay. Nothing’s perfect, but you need to have a remediation plan for it. If you were going to close a couple of big deals during diligence and you don’t, or they get delayed, the valuation may take a hit. Or they might inject some structure like an earn-out if you can get these two deals signed.

“But if you don’t own your IP and don’t own or clearly license all your code, that’s tough to navigate around. Or if you’ve infringed on somebody. That can be a dealbreaker, but it isn’t that common.”

• Adam Haynes on LinkedIn
• GLC Advisors on LinkedIn
• GLC Advisors website
• GLC Software Capital Markets Report – Q1 2024

Tune into the Practical Founders Podcast for weekly in-depth interviews with founders who have built valuable software companies without big funding. Subscribe to the Practical Founders Podcast using your favorite podcast app.

John Stewart created and sold an engineering services business, then grew a Salesforce integration services company before building some early software products. One of their software experiments allowed Salesforce customers to see and interact with their customer data on a map. When customers paid for it and revenue grew, he and his co-founder wound down services and focused on their mapping product. 

MapAnything grew quickly to over $2M ARR as a bootstrapped software company, with some revenue-based financing from Lighter Capital to help test their growth plans. When they focused on field service route optimization and grew quickly, MapAnything raised several rounds of venture capital to grow even faster by focusing its sales and marketing efforts within the Salesforce ecosystem. 

MapAnything reached $22 million in ARR before Salesforce acquired the company for $250 million. John stayed on with Salesforce for six months before moving on. John and a co-founder launched Fastbreak.ai three years later, a sports schedule optimization platform for professional and amateur sports leagues. 

Quote from John Stewart, former CEO of MapAnything

“I tell founders most often that you really need to focus on sales and distribution. As a CEO of a startup in the tech space or SaaS, the only thing that really matters is revenue growth. Technology is technology. Even if you have unique IP right now, it won’t be unique soon enough.

“So you need to figure out your go-to-market motion. That’s the single most important thing. Revenue cures all ills. It doesn’t matter what’s going on in the company as long as revenue is growing. It’s all about revenue growth more than anything.”

• John Stewart on LinkedIn
• MapAnything on LinkedIn
• Salesforce website
• Fastbreak.ai website

Tune into the Practical Founders Podcast for weekly in-depth interviews with founders who have built valuable software companies without big funding. Subscribe to the Practical Founders Podcast using your favorite podcast app.

Matt Wolach spent 15 years as a successful SaaS account rep, sales leader, and software founder before becoming a SaaS sales coach for early-stage B2B SaaS companies. He has worked with over 250 SaaS founders and sales leaders worldwide to improve their close rates and create repeatable sales systems quickly.

In this episode, Matt shares:

• How B2B SaaS founders need to learn to sell and understand their own sales processes before hiring salespeople
• Why technical founders can their sales using a helpful mindset of customer problem-solving
• Why he starts by analyzing the sales demo to understand what’s working and what needs to be improved in the sales process
• How successful founders and salespeople show their product less and follow up more than their peers
• Why software buyers are tired of buying software and don’t want to engage with commission-focused salespeople

“The only way a buyer can be excited about your solution is if they are really emotional about their own problem. How can we get them to realize their problem is important and worse than they thought? 

“If they’re gonna take action, they’ve gotta be emotional about their problems. They come in thinking, I just got this thing I want to take care of. And they leave saying, Whoa, I had no idea we were in so much trouble. We have to move now.

“We have to make sure that they prioritize the problem we solve instead of not doing anything and moving on to a different problem. When they realize how bad their problem is and feel the emotion, it helps them see they need to prioritize it and take action instead of putting it on the back burner and waiting till later.”

• Matt Wolach on LinkedIn
• Matt Wolach SaaS sales coach website
• Matt Wolach YouTube channel
• Scale Your SaaS podcast

Tune into the Practical Founders Podcast for weekly in-depth interviews with founders who have built valuable software companies without big funding. Subscribe to the Practical Founders Podcast using your favorite podcast app.

Charlie Alsmiller is the founder and CEO of APIWORX, a powerful integration platform for mid-sized ecommerce companies. He is an experienced practical founder who has created and grown several software companies. His first venture was VC-funded and shut down quickly in 2001. His next software ventures were bootstrapped with funding from services revenue and his own savings.

APIWORKS is a powerful integration platform that connects Shopify data to accounting software and other applications. Charlie started the company in 2020, with well over $1M in annual recurring revenues and 30 employees. They are growing faster by focusing on key vendor ecosystems and specific customer problems where they have a unique advantage.

In this episode, Charlie shares:

• What happened when challenges arose in his first company, which was VC-funded
• Why he started a services business to find and fund his next software business
• What happened after his first successful exit that made him start another company
• How he ideated and validated to discover the best startup idea to invest in
• Why they are growing faster every time they niche down on specific vendor ecosystems 
• Why startup CEOs should eventually focus on their superpowers and delegate everything else

Quote from Charlie Alsmiller, founder and CEO of APIWORX
“As a startup founder, you need to really know yourself. Know your personality type, know your skills, and know your superpower. Focus on what you do best and where you add the most value.

“I have the superpower of whacking the machete to start new things, clearing the brush away in new markets, and figuring it out. And I’m pretty good at recruiting people who can do the things I don’t do well. Now my team tells me, Charlie, don’t do that, we’ll do it and you go do that thing over there.

As an early-stage founder, you start by taking out the trash, doing software development, doing marketing, and everything else. As soon as you can scrape together the pennies to outsource or hire those other things you’re not good at, you should do it because it allows you to double down and grow faster. That’s the game changer for your growth.“

• Charlie Alsmiller on LinkedIn
• APIWORX on LinkedIn
• APIWORX website

Tune into the Practical Founders Podcast for weekly in-depth interviews with founders who have built valuable software companies without big funding. Subscribe to the Practical Founders Podcast using your favorite podcast app.

David Evans, the managing partner of Sentiero Ventures, a seed fund focused on AI-focused software startups. David discusses the role of AI in software development and the opportunities it presents for practical SaaS startups. He shares his journey with AI and predictive modeling in his previous companies and the key factors he looks for when investing in AI-powered companies.

In this expert podcast interview, David discusses:

• The new questions about revenue models for AI-powered companies
• The challenge of cost in AI and the potential for innovation
• The importance of clean and relevant data to train models and machine learning
• Balancing AI in the go-to-market strategy
• The impact of AI on various industries

Quote from David Evans, Managing Partner of Sentiero Ventures
“The biggest challenges and opportunities we see right now are in the revenue model. The traditional per-user, per-month model in SaaS is becoming increasingly difficult to justify in AI-powered companies because every time I interact with ChatGPT, there is an associated nontrivial cost. When I ask it a question with AI, there is a compute resource of OpenAI or whatever that is being directly accessed.

“This also leads to some opportunities to scale revenue more quickly because you can now charge based on utilization. With the right sort of unit economics, you have the opportunity to scale your revenue more directly with usage and value. Companies will scale their utilization very quickly when they see results. It gets really interesting fast.

“It’s obvious when you start viewing it through the lens of whether I need to run one more campaign. If they are making money, then yes, I’ll pay for the next campaign and the next one. We’re seeing a better scale with utilization-based billing. You have to figure out the unit economics to ensure you’re doing it profitably.”

• David Evans on LinkedIn
• Sentiero Ventures on LinkedIn
• Sentiero Ventures website

Tune into the Practical Founders Podcast for weekly in-depth interviews with founders who have built valuable software companies without big funding. Subscribe to the Practical Founders Podcast using your favorite podcast app.

Phil Dur is cofounder and managing partner of PeakSpan Capital, a growth equity investment firm that works with bootstrapped SaaS founders who are scaling up to become sizable market leaders. Phil has been funding capital-efficient software founders for over 20 year and has served on 45 boards with those companies.

In this expert podcast interview, Phil explains:

• Why the practical growth equity approach is fundamentally different from the venture investment approach
• How PeakSpan and other growth equity investors support bootstrapped and capital-efficient SaaS founders
• Why founders should be taking money off the table with every funding or transaction event
• When can growth equity investment be a good fit for practical SaaS founders
• Why founders should be thinking about the risk-adjusted odds of successful exits at multiple milestones

Quote from Phil Dur, Managing Partner of PeakSpan Capital
“It’s a big deal to bring an investment partner into your business because now you’re now collaborating with someone on your big decisions. Some founders only need to look themselves in the morning mirror to decide what will happen in their business this year. When you have investor partners, you will have more dialogue to align around important decisions. 

“Unfortunately, I frequently see entrepreneurs picking their first investor partner without much time getting to know them and experience working with them. That’s why we start actively helping our founders 6 to 12 months before they make a final decision on a transaction.

“We want our founders to get a free trial of what the full experience is going to feel like before we work with them. Founders should be doing that with every other investor they are interested in.

“Don’t bring someone into your business with eight figures of capital at risk when you just met the partner two weeks before term sheets are due. That’s not a smart strategy for founders.”

• Phil Dur on LinkedIn
• PeakSpan Capital on LinkedIn
• PeakSpan Capital website 

Tune into the Practical Founders Podcast for weekly in-depth interviews with founders who have built valuable software companies without big funding. Subscribe to the Practical Founders Podcast using your favorite podcast app.

Joe McMenemon and his college roommate, Brendan, knew they wanted to start a business together. They had run their college fraternity chapter and saw the problem of managing members and collecting payments. So they lived frugally and built a software solution  for fraternities and sororities to solve this problem.

ChapterSpot grew slowly over several years as they sold to local chapters. Eventually, the national associations came calling, requesting an enterprise solution to manage hundreds of chapters in one system. They rewrote the platform to run on Salesforce and grew faster with more employees. 

ChapterSpot grew profitably to over 30 employees, with 40 large organizations managing thousands of chapters and millions of members on the platform. ChapterSpot was acquired in early 2024 by BillHighway, a strategic acquirer with a payments platform.

"Long shots are probably not as crazy as you may think they are, but they're just going to require time. If you think you'll make a bunch of money in three years, it's probably very unlikely. But if you're willing to put in the time and work at it every day, you're most likely going to be able to figure out the right path to success.

"My favorite quote is from James Clear: It's the courage to start, a few lucky breaks along the way, and a ton of hard work. That's the formula.

"Once you get started, are you putting yourself in a position where you can do it at a level that's best in the world for the problem you are solving? If you're the only one trying to solve the problem and you do it long enough to catch a few lucky breaks, well, eventually, you'll get there."

• Joe McMenemon on LinkedIn
• ChapterSpot on LinkedIn
• ChapterSpot website
• BillHighway website

Tune into the Practical Founders Podcast for weekly in-depth interviews with founders who have built valuable software companies without big funding. Subscribe to the Practical Founders Podcast using your favorite podcast app.

Jeromy Wilson spent over ten years in the software business as a product management leader working for PE-owned and VC-funded software companies. When he decided to start his own software company, he focused on serving public libraries, like his father, who had created a successful library automation software company called Dynix.

Jeromy is the founder and CEO of Niche Academy, the leading learning and development platform for libraries in the US. With his savings and a little angel funding, Niche Academy struggled at first but eventually grew into a profitable and growing software company with 20 employees that is almost ten years old. 

Jeromy and his co-founder have no intention of selling the company or raising big VC funding. They are focused on serving their customers, developing their employees, and living great lives with their families right now. 

“Early on, I idolized VC-funded founders. Why aren’t I growing as fast as that funded company? But now, I say thank goodness. I’m not dictated to like they are, have the problems that they have, or have these massive crashes that some of them end up having. I don’t idolize them as much anymore. 

“I love the freedom that I have now as the CEO of a profitable software company that didn’t take big VC funding. When you don’t have tons of outside funding, you make different decisions and choices. You do things in a way that is going to make a difference for the customer rather than how we can make more money today. 

“I’m a real believer in being in charge of your own destiny, having this control, and being able to grow with your profits because you know it’s valid. Your solution is something that your customers see as valuable rather than something that some VCs see as valuable.

• Jeromy Wilson on LinkedIn
• Niche Academy on LinkedIn
• Niche Academy website

Learn more at practicalfounders.com. 

Paul Van Metre was the co-founder of a successful machine shop that manufactured custom parts for the aerospace and medical device industries. Over 15 years, they created and improved software to run their entire business, which created huge efficiencies and helped them manage their growth. They sold that business in 2014 to focus on selling their complete software platform, called ProShop, to other forward-thinking machine shops. 

ProShop is now one of North America's leading ERP (enterprise resource planning) software platforms for machine shops. The software manages every aspect of a machine shop business, from orders, finances, inventory, and shop floor operations. 

The company grew quickly with no outside funding as happy customers spread the word in their industry. Their software company focuses on processes, customer service, and company culture. In 2024, ProShop received a $32 million growth equity investment from Mainsail Partners, which allowed the founders to take money off the table and fund new growth. 

• Paul Van Metre on LinkedIn
• ProShop on LinkedIn
• ProShop website
• Mainsail Partners website

Tune into the Practical Founders Podcast for weekly in-depth interviews with founders who have built valuable software companies—without big funding.

Chris Savage is the co-founder of Wistia, a leading video marketing platform for businesses. Wistia was started in 2007 by Chris and a college friend when inexpensive cloud hosting and easy web video encoding became available. They created the first easy way to host and share videos with deep analytics and no ads for marketers to use on their websites. 

With a bootstrapped approach and just $1.2 million in angel funding, Wistia grew quickly and profitably, becoming a leading video hosting platform used by thousands of small and mid-sized business customers. The company experienced typical internal challenges with leadership, culture, and focus as it grew to 80 employees by 2015. 

In 2017, Chris and his cofounder Brendan received several significant offers to buy the company. They decided not to sell the business, and the company made a tender offer to buy out their angel investors’ shares and some employee options. Wistia got back to profitability the following year by refocusing on its core business and aligning its team around efficient long-term growth. 

Wistia is still growing, with 180 employees, tens of thousands of customers, and millions of users. It is very profitable. The founders still love what they do and have no intention of selling the company any time soon. 

Learn more at practicalfounders.com.

Rand Fishkin is the founder and former CEO of Moz, a leading SEO software for marketers created in 2007 that grew out of the active followers of Rand’s popular SEOmoz blog. Moz grew quickly to over $30 million in revenue by 2013, having raised $30 million in venture capital investment. When growth slowed in 2014, the company faced many internal difficulties and Rand dealt with mental health challenges, causing him to step down as CEO.

Rand left Moz in 2018 and later that year published his popular book about his difficult startup journey, “Lost and Founder: A Painfully Honest Field Guide to the Startup World.” He described in detail the growth of Moz and the exciting growth years, but he also revealed the painful challenges he and the company faced in their later years. In this podcast discussion, he is frank about the pitfalls and brutal realities of big VC funding for founders and the companies they created. 

Rand created his second software company, SparkToro, in 2018 with an approach that was opposite to the funding, growth, and staffing he used at Moz. We discuss the benefits of practical funding and sustainable profits to create healthy software businesses that support the goals of founders, employees, customers, and investors.

Learn more at PracticalFounders.com. 

Nathan Hirsch, co-founder of FreeUp, shares his journey of building and selling the company and his other business adventures. FreeUp provides clients with pre-vetted virtual assistants (VAs) and freelancers in an online marketplace.  

Nathan discusses the importance of niching down and targeting specific industries, such as e-commerce, to attract clients. He also highlights the combination of software and people in FreeUp’s operations, with software handling recruitment and billing and people assisting with matching and customer service.

FreeUp achieved success through organic marketing strategies, niche focus, and great customer service. The business grew to $12 million in revenue in four years before being acquired by The HOTH in 2019. 

Learn more at practicalfounders.com.

Landon Taylor created two successful digital marketing services businesses before starting a product-powered business with recurring revenues. His first agency drove traffic to its customers, which led to his second business, Best Company, which produced qualified leads for large home services businesses through its bestcompany.com consumer review site. 

Their work in consumer reviews led them to his latest business, Snoball, a word-of-mouth marketing platform they use to predictably and efficiently drive customer referrals. With their systematic approach and some human-in-the-loop help, Snoball creates a scalable customer acquisition channel for large home services businesses in the US. 

Landon speaks openly about his approach to “parlay” one business into another to create new businesses that are larger and more valuable than the last. Rather than raising big VC funding, Landon invests his own resources to find and create new businesses. 

Quote from Landon Taylor, CEO of Snoball

“Fear can be debilitating for an entrepreneur. If you fear failure, if you take a leap and you’re gonna fail, you’ll be paralyzed. You won’t be able to move forward, see opportunities, and take risks that will open up doors.

“You’ve gotta get to the mindset that failure is not fatal. Everybody who’s been successful has failed multiple times, right? So just take the leap. It can be a small leap. Or it could be a mental leap of believing that I can build, I can create, I’ve got something unique.

“It might be as simple as wanting to do a LinkedIn post, but you hit this wall of ‘I can’t.’ So get beyond that to believe I can, I’ve got something unique, I can build, I can create.”

• Landon Taylor on LinkedIn
• Snoball on LinkedIn
• Snoball website
• BestCompany.com website

This week’s podcast is sponsored by my friends at Cypress Growth Capital. For 15 years, Cypress has provided non-dilutive growth funding to bootstrapped SaaS founders, including many successful founders I’ve interviewed here on this podcast.

Connect with Cliff Sentell at cypressgrowthcapital.com/practical to find out how they can help with your practical growth plans. 

Tune into the Practical Founders Podcast for weekly in-depth interviews with founders who have built valuable software companies without big funding. Subscribe to the Practical Founders Podcast using your favorite podcast app.

Ian Brodie, the co-founder and CEO of Levanta, shares his journey of building a successful SaaS company in the affiliate marketing space.

Levanta is an affiliate marketing platform for Amazon sellers, enabling them to connect with content creators, publishers, and influencers to drive sales and traffic to their Amazon storefronts. The company has experienced rapid growth, with over 700 brands and 3,000 affiliates on the platform. Ian discusses the challenges and opportunities of the affiliate marketing industry, working with Amazon, and the importance of building credibility and confidence as a young founder.

He also discusses his experience of successful selling his previous company, Grovia, an affiliate partner recruiting services company that was acquired by Acceleration Partners in 2022.

Learn more at practicalfounders.com. 

Gregg Scoresby founded CampusLogic in Phoenix in 2021 to provide software for colleges and universities in the US to make it easier for students to apply for college loans and grants online. Initially self-funded, CampusLogic raised investment and grew faster, becoming a leading provider of software to universities with $50 million in revenue. In 2022, CampusLogic was acquired by Ellucian for an undisclosed amount. 

In 2023, Gregg launched PHX Ventures, a $27 million seed-funded supporting early-stage B2B SaaS founders in Phoenix, Arizona. Unlike the traditional VC approach, PHX Ventures supports startups that are growing fast with a capital-efficient approach. PHX Ventures also helps the larger software community in Phoenix with educational events and networks to connect founders, talent, experts, and capital.

In this expert episode, Gregg answers common questions about when practical venture funding can be useful for founders and what it means to be capital efficient. 

Learn more at practicalfounders.com. 

Esben Friis-Jensen and his cofounder, Sebastian Seilund, teamed up in 2021 to create Userflow, a no-code user onboarding product for SaaS companies. This week, it was announced that Userflow has been acquired by Beamer, a maker of product user engagement software that also used product-led growth strategies just like Userflow. 

Userflow is profitable and growing, with over $4 million in ARR, 750 customers, and just three employees with no outside funding. Techcrunch reported that Userflow was acquired in a $60 million deal, supported by Beamer investors Camber Partners and other investors. 

Esben told the Userflow story on the Practical Founders Podcast in episode 42 last year. This is an update about the recent acquisition and his thinking behind selling the company.  

Learn more at practicalfounders.com.

Antony Ceravolo is a successful two-time startup founder from Adelaide, South Australia. He started his career in investment banking but left in 2002 to start a DVD rental business in London that raised funding from big VCs and Amazon. It grew into Lovefilm.com, which was later acquired by Amazon in 2011 to become part of their movie streaming service. 

He moved back to Adelaide and started Sine in 2013 to help schools, businesses, and large office buildings manage guest sign-ins more securely using iPads at their front desks. They also started tracking visiting contractors and vendors with their mobile app, allowing automatic check-ins and tracking for operations managers.  

Sine grew quickly with global customers and large deals, eventually growing to 100 employees, mostly in Adelaide, with no VC funding or institutional investors. Sine was acquired by Honeywell in 2020 and became a critical product in their property management technology suite. 

Antony speaks openly about the benefits and challenges of working with institutional investors and why he avoided raising VC funding with Sine. 

Learn more at practicalfounders.com. 

Raj Khera is an experienced practical SaaS founder who has used search engine optimization (SEO) to grow businesses very efficiently. Now he coaches entrepreneurs at MoreBusiness on how to use organic SEO as a core part of their marketing engine. 

In this expert interview, I ask Raj to explain the basics of SEO for SaaS founders, what tools and techniques are most useful, and how SaaS founders can make the most of SEO investments to drive revenue faster.

SEO for Bootstrapped SaaS Topics Discussed on this Podcast

• How he used SEO to grow his previous software companies
• The basic concepts of search engine optimization (SEO) for SaaS founders
• Simple tactics for identifying search terms that would create qualified traffic
• His favorite tactic for gaining authority from Google for your organic website content
• Which search engine marketing tools are most useful to maximize your time and investment
• The simple ROI math that founders can use to measure their investment return with SEO

Learn more at practicalfounders.com. 

Justin Hewett started in the software business as a territory sales manager for an education software company in Utah. The company grew and Justin eventually led the sales team as the senior executive. When the company was acquired by PE investors, Justin moved on in 2020 and thought about ideas for a new software business to serve K-12 schools in the US. 

Flashlight Learning helps K-12 teachers in the US to quickly assess the speaking and writing progress of multilingual students who are learning English. The software captures data for teachers to provide students with improved feedback to accelerate language development.

Flashlight Learning grew 300% in 2023 to $4 million in revenue, with a growing team and an outsourced development partner. Justin raised some angel funding to get started and move fast, but they are expecting to be profitable this year with continued growth.

Learn more at practicalfounders.com.

Morgan Katz is the founder and CEO of Ticketnology. Morgan was an enthusiastic athlete with a degree in sports management who started her career in ticket sales for sports teams and front-line venue management. Morgan saw how companies with season tickets had difficulty managing their digital tickets after COVID, so she started her own company to solve it with a software solution. 

Ticketnology is a fast-growing leader in the new category of season ticket management software. Started with a mix of hands-on concierge services and a software solution, Ticketnology is now a complete platform that helps season ticket holders manage and distribute tickets to maximize the value of their season ticket investment. 

Ticketnology is a bootstrapped and profitable software company with just over $2 million in revenue, four full-time employees, and an outsourced development team. They doubled revenues this year and expect to double each year for the next few years. Morgan is a member of a Practical Founders Peer Group. 

Learn more at practicalfounders.com.

Stephanie Betters was a practicing Nurse Practitioner in heart surgery and an active real estate investor when her frustration with disparate real estate CRM and marketing solutions hit a boiling point. Salesforce and a development partner proposed a project so expensive that Stephanie hung up and decided to build the solution herself. She learned to code and build a useful real estate CRM on Salesforce in three months.

Her business thrived with her comprehensive software. Other real estate investors heard about her software and encouraged her to launch the company in 2019 and start selling the software, now called Left Main REI. Word spread in the industry and hundreds of real estate investors signed up in the first year, transforming their businesses. 

In just over three years, Left Main REI now has hundreds of customers, 20 employees, and nearly $3 million in annual recurring revenue. The company has been bootstrapped and profitable from the first day. Stephanie has a big vision for the company and loves her founder/CEO role; she will no longer be practicing as a Nurse Practitioner as of 2022. 

Learn more at practicalfounders.com. 

Shameem Hameed created several companies, including a medical billing services company, before starting ZH Healthcare in 2008 to provide billing and EHR software to innovative healthcare providers. Their BlueBriX software grew into a comprehensive and customizable platform used by hundreds of healthcare organizations around the world. 

ZH Healthcare now has almost 200 employees in the US and India. The company has been profitable every year and has not taken on any outside funding. 

Kevin McArdle spent 15 years working in large software companies before becoming a practical investor and acquirer of smaller SaaS businesses. Kevin is the CEO and co-founder of Big Band Software, a holding company that buys and holds small, profitable, and growing SaaS businesses—with no intent of selling those businesses. Kevin has acquired over 40 businesses in the last 10 years with this buy-and-hold model. 

As an expert guest on the podcast, Kevin answers common questions from practical founders about the holding company approach as an exit path. Holding companies are common in other industries, including Warren Buffet's Berkshire Hathaway, but relatively new to the software industry.

Learn more at practicalfounders.com.

Kyle York was the Chief Revenue Officer of Dyn, a bootstrapped cloud infrastructure that he helped grow and sell to Oracle for over $600 million. He then led product strategy and acquisitions in Oracle’s cloud infrastructure group before going out on his own to invest in SaaS startups and help them grow. 

York IE is both an advisory firm with tech-enabled services to help early-stage B2B SaaS companies grow  and an investment firm that has invested in over 60 practical SaaS companies.  

In this expert session, Kyle discusses why his efficient funding approach appeals to practical SaaS founders and why it is different than traditional VC funding. We discuss the current environment for funding, growth, and exits for practical founders. We also dive into what’s working and not working in 2024 to drive growth in capital-efficient SaaS businesses. 

Quote from Kyle York, Founder of York IE

“It’s gonna sound so simple, but founders need to set the long-term vision of what they want to be and what they want to build. Then make sure that every decision you make backward to today is working towards fulfilling that vision.

“What I see too often is companies pigeonholing themselves down a certain trajectory or path that isn’t even aligned exactly with what they wanted. This can create problems when you’re raising money from outside investors if what investors want is not the same as your vision and timeline

• Kyle York on LinkedIn
• York IE on LinkedIn
• York IE website

This week’s podcast is sponsored by my friends at Cypress Growth Capital. For 15 years, Cypress has provided non-dilutive growth funding to bootstrapped SaaS founders, including many successful founders I’ve interviewed here on this podcast.

Connect with Cliff Sentell at cypressgrowthcapital.com/practical to find out how they can help with your practical growth plans. 

Tune into the Practical Founders Podcast for weekly in-depth interviews with founders who have built valuable software companies without big funding. Subscribe to the Practical Founders Podcast using your favorite podcast app.

Harry Hopkins is co-founder and CIO of Viewgol, a medical billing technology software and services company based in Dallas, Texas. Viewgol was started in 2017 by three founders who got the product and revenues going before hiring additional staff. Their revenue cycle management (RCM) analytics software reveals medical billing problems and missed revenue opportunities at physician offices in the US.

As the company expanded its service offerings, Viewgol grew very quickly, from three employees in 2019 to almost a thousand employees at the end of 2023. Viewgol was acquired in October 2023 by CPSI, a public medical billing solutions company, for a reported $67 million in cash and earnouts. 

Hamed Mazrouie owned a security monitoring business and other businesses for many years before he started his first software and services business called Vivant Corporation. Vivant provides a complete multi-site internet phone system to thousands of restaurants and law firms across the US. Vivant grew steadily and profitably for 10 years and is now a maturing business with 50 employees. 

In the last four years, Hamed and his growing team have been building Milagro, a complete restaurant management system to increase repeat customer business. They now have happy paying customers who use their powerful software which includes advanced data analytics. Their vision is expanding based on early customer results. 

Learn more at practicalfounders.com.