6 Bootstrapped Lessons Learned on the Way to $100 Million
Mass times velocity. That is all momentum is, really. It can be easy to grasp the formula when you are thinking of a tangible object, such as a snowball gathering size and speed as it hurtles down a slope. But what about something more complex, like a business? Revenue, products, customers, employees — there are so many numbers you can use to quantify an organization’s momentum.
Aha! has been fortunate to experience a steady increase in all over the years, with plenty of numbers to signify our success.
Last year we announced a major revenue milestone — Aha! is now well past $100 million in annual recurring revenue (ARR). We launched the Bootstrap Movement to inspire and champion others who dare to build differently. We introduced a new offering to our product development software suite with Aha! Create. (Editor's note: Aha! Create is now Aha! Notebooks. See what is new.) And the company was honored to once again be named a top employer, this time by Forbes.
I have written quite a bit about the Aha! journey over the years — in various articles, on the Aha! blog, and in Lovability, our best-selling book. If you have been reading along, you likely know the answer to the question of how we started and scaled the business: self-funding, remote work, experts serving customers, reducing friction, and eliminating drama.
But reflecting on the team’s achievements of late got me thinking about the core learnings we experienced as a bootstrapped company. Here are six lessons that I believe to be essential:
$100 million companies start out as $1 million companies. It is perfectly fine to focus on a narrow problem and solve it well. Ignore people when they tell you that it is a niche market (assuming you are convinced that there is a real issue to solve for at least a small group of people who will pay for the solution). Solving a specific problem exceptionally well will build trust that you can solve more problems in the future.
Great companies are not incrementally better than other companies. Great companies are truly different — in an undeniable way that is immediately recognized. You need to focus on what makes you one-of-a-kind. Do not be overly concerned with what people think or compare your company to others. Dedicate time early on to documenting what you want your organization to stand for and how it will operate in a way that is uniquely different. This is your greatness and it will be what sets you apart.
"First one focus, second one free." I often say this and get a curious look. What I mean is that if you focus deeply on the opportunities you face today, others will emerge naturally — if you are successful. The same goes for problems. Do not theorize about how you will handle situations that are not occurring right now. Stay present and do not get sidetracked by what-ifs that have no bearing on your current reality.
Be careful when others want you to become what you are not. Listen closely and prod to understand the impetus and motivation behind their thinking. If an outside opinion is not aligned with your definition of greatness or where you are headed, say no and explain why. And when you have evaluated all angles and are certain of the path forward, do not be embarrassed and hold your ground. These challenges are a healthy and ongoing exercise for any founder or company leader.
Waste is not just monetary. (Although avoiding fancy offices and expensive dinners is always a good idea). You can never afford to squander time or the efforts of people you work with. Every minute is precious. There are hidden costs lurking — from spending too much time with a prospective customer who has no intention of buying, investing in projects that do not support core goals, or allowing meetings to bloat your team’s calendars. Be vigilant. This is integral to a bootstrap mentality and can become part of your organization's operating philosophy as you scale the business.
A business exists to create value. The value you create is exchanged between you and your customers, teammates, and community. This is a virtuous cycle that happens incrementally — building momentum that powers sustainable growth over time. If you know the worth of what you are providing and are dedicated to serving the customers who buy from you, there will be even more value to share with others.
People, profit, and performance are your focus. Anything that does not directly support those three is likely not worth your time and will only distract you from reaching your goals.
A major milestone like $100 million in ARR was certainly a goal for us at Aha! — but it was not the goal. Our aim remains the same as when we first started the company in the spring of 2013. We want to help people build better products. We want to be a company where exceptional people can achieve their best. And we want to honor our success through the integrity of our actions.
There will be more to learn as we progress towards our next major milestone. And I am confident that the lessons that got us here will take us there.