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'Good company can come in the way of building a great company', said a 2nd time SaaS founder to me. What does that mean? Are you going to be a $5m or $50-100-150m revenue business?👇
Say you start selling $5k accounts. You just need 50 customers to get to $250k revenue scale. Pure online, self serve, it's so easy to run out of a garage! Where do you go now?
Some founders starts OPTIMIZING FOR REVENUE - which makes it hard to take tough calls on product: 'My product can't be a platform, or is not high engagement for user, so let's pivot' is not possible. You've given up the shot to be a market leader.
Because your business can't be a leader or be very big, the best and most ambitious talent doesn't want to work at your company. Now you start OPTIMIZING FOR PROFITS. Founders hire a team of 50-100 mostly junior folks. Your business is now on a linear path.
If you don't have the best talent, the best capital doesn't flow to your company. Now you start OPTIMIZING FOR OWNERSHIP. Bootstrap and reinvest profits. At $250k rev maybe you can add 2-5 new engineers/year. You're on a slow 5-10 year path to 1000 customers, $5M revenue.
If $5m rev is satisfying, great! Read no further. If not 1) Be mindful of tough calls you need to make, that good is enemy of great 2) Dont rush to declare product market fit 3) It's ok to let early customers go if you need to pivot 4) Ruthlessly seek A+ talent
