Most CEOs read a book a week. Bill Gates notes that reading 50 books a year gives him a huge advantage. When Warren Buffet started his investing career, he read between 600 and 1000 pages per day. When Elon Musk was asked how he learned to build rockets, he said, “I read books.” And the list goes on and on.
I think it’s safe to state that knowledge is the foundation of virtually everything.
Today, I want to contribute to your sphere of knowledge about building startups under limited to no budget by showing you how you will save over $10,000 on product (web/mobile app) development, marketing and resources you need to startup and grow your venture.
Take a look,
If you wanted to build a web app like Locker and didn’t have the background to code and design it yourself or the money to hire a team to build it for you, what would you do?
If you said,
You aced it. You’re now becoming an expert bootstrapper.
If you read the three posts above, you should have learned how to generate revenue for your startup literally from scratch. What I want to discuss today is the cost minimization part of bootstrapping a startup.
Say you pre-sold 50 units of your upcoming product and raised $2,000. One would argue, this is still a very small amount to turn any qualitatively validated idea into a useful product (web/mobile app).
90% of the time, that is a wrong claim.
How much do you think it cost Locker founders to build the current version of their web app?
Here is why and how.
When I met with Frank a few months ago to discuss the steps he took to execute on his ideas, he mentioned that he secured $10,000 investment to build what he learned to be the core of Locker: browsing, listing and contacting. After speaking with local teams, he found that his investment wouldn’t be enough to complete the web app with any of the teams he thought were a good fit.
We talked about hiring freelancers but focused our discussion on how we can begin by doing most of the technical work.
What that means is, if we can find a customizable theme on marketplaces like Themeforest, our freelance hiring approach will be more about finding programmers who can customize a theme instead of looking for those who can build a web app from scratch. It’s much harder to build than customize and thus, finding someone who can help with the customization would cost a lot less.
So, he found the right product that only cost $59 and comes with many integrations that he will need.
So, every time and before you start you’re recruiting, always be looking for ways to save time and money by leveraging ready-to-go pages through Themeforst.
I’ve always been a big proponent of doing a practice startup for gaining practical knowledge and entrepreneurial confidence. If you’re just starting to practice and experience entrepreneurship, then make sure you take advantage of customizable themes as they give you the option to experiment with multiple ideas at low costs.
Now, you may argue, those are WordPress themes and nothing major or scalable can be built out of WordPress. And the answer Yes, 100% correct. WordPress is built for blogging and only in the recent years that it started expanding its functionality to enable the integration of plugins that serve purposes other than writing and promoting blog posts.
WordPress is what’s going to help you quantitatively, quickly and cheaply test your idea before you start building advanced, scalable versions of your product. Remember that Groupon started with a WordPress site and by fulfilling buyers’ orders manually through phone and e-mail. In just 2 years, Groupon reached a billion-dollar valuation.
Not every idea has a theme built for it. If you can’t find a theme with similar functionality to what you need to create, then build one from scratch.
I want you to take a minute to visit the apps that entrepreneurs created with the invaluable drag and drop tool, Bubble.
Regardless of how unique your idea can be, Bubble will help you make it happen. Remember that what we’re building is not a multi million dollar application but one that will help us get to market faster despite our limited funds and in the meanwhile, build value and enough proof to attract the best co-founders and/or investors if we’re looking for any.
Customizable themes and Bubble are two ways you can move beyond the idea, research, interviews, and pre-selling stages.
But before we get into the strategies that will minimize your operating expenses, use the following tool to interact with an already built audience for your upcoming product.
1) Ship by Product Hunt
In Product Hunt’s words, Ship enables you to capture demand, build an audience and scale your vision. Within Product Hunt, you can use Ship to create customizable landing pages, seek feedback, capture early sign ups, and directly chat with users who showed interest in your upcoming product. Here is an example.
First, it doesn’t hurt to enter your email to get a promising tool like the one above if you could save a few thousand dollars on legal fees in the future. You could even create an email just for subscriptions like this.
Second, many of the products that trend on Product Hunt and BetaList end up leading the startup scene. Keeping up with current trends is a key ingredient to success in this rapidly changing startup scene.
I’ve been looking to use Hiten Shah’s coming soon startup DraftSend until he launched the platform a couple of days ago so I jumped on it to create my first video and gained thousands of views after Hiten and his co-founder shared to their 200,000+ followers.
Notice how at the beginning and end of the post, I mention and refer viewers to my ventures. This is another way you could leverage product launch platforms to bootstrap your startup.
2) Startup Plans
lately, more like over the past 2 years, many established companies started introducing plans tailored exclusively for startups. Companies like Unbounce, Clerky, CloudApp and ActiveTrail have opened up their tools for use by startups that meet certain criteria.
This is an opportunity to save thousands of dollars. Obviously if you’re not going to use the tools or services they provide, don’t apply but if
1) funding has been limiting your start or growth,
2) It’s an opportunity to save on tools you already use or will need,
then don’t hesitate. It could be the most valuable 5 minutes you spend today.
3) Subscription Duration
As you may very well know, your website or app needs to be hosted somewhere. This year I made a mistake that’s costing me over $500.
With all the startups that our team at StartupCircle.co is running, we needed more power, flexibility and control so we upgraded our plan. I decided that we should upgrade to the new plan for 3 months and then decided whether we should continue or not at that point.
There was 50% off to encourage users for the upgrades and had we chosen 12, 24 or 36 months instead of 3, we would have saved at least $500. I called the team at Bluehost asking for further discounts but they couldn’t do much once I opted in for 3.
The lesson to be learned here is that especially for your newly built website or blog, don’t hesitate to go for 12 months or more in order for you to take advantage of the savings. Prepaying for 12 consecutive months is almost as if you choose the same plan but decided to pay month by month. Bluehost is highly recommended and today, they’re offering 50% for joining.
This cost minimization strategy also works the other way around.
To host the presentations for the Bootstrap a Startup Program, I used Wisita. In order to save $250 a year, I selected the yearly plan. But now that registrations to the program are closed and the entrepreneurs that have been part of the program have completed all the milestones, I reached out to the team at Wisita asking to cancel my subscription for now until the program resumes in few months. This led to a couple of hundreds more in savings.
On a slightly different note, one of the cost minimization strategies that I found very effective is the partnerships discount offers. The way this works is that by looking for the partners/affiliates of a product you want to buy then find out if those partners have a special offer for their users.
For instance, to run AND CO’s recent $192 giveaway, I did some research and found that KingSumo is one of the best giveaway plugins in the market. I also found that Josh Earl is one of KingSumo’s partners and by joining his network, he would send me a code to get 50% off on the plugin. So, a simple email submission saved us almost $100.
Now it’s my turn. Head over to EntrePerks and if there is one offer that you need, join us below and respond to my welcome email with the name of the offer. I will get back to you shortly after.
Also on a different note, another cost minimization strategy that worked very well for me is the cart abandonment strategy. This is when you go through the first steps of registration before making a payment for a product and then you do two things. First, do nothing. Wait 10-15 min in the payment page and see if they approach you with a discount. If nothing happens, close the page and wait 24-48 hours. Most of the time, you will receive an email giving you a discount to encourage you to pay.
4) AppSumo & EntrePerks
If you’re ever looking for one place where you could find instant discounts on some of the best products in the market, these two companies are where you should go.
AppSumo is Groupon for startups. They partner with companies to offer deeply discounted products in hopes that many will buy. It’s also a way for companies to gain awareness for their products by getting exposed to over 700,000 tech enthusiasts.
When you join EntrePerks, you access over $22,000 in combined savings so far from companies like MeetEdgar, FOMO, Balsamiq, CrowdSpring, Logojoy, One Month, ConvertKit and over 90 more tools and services.
Always check these two platforms before buying a product or service.
So, let’s take everything all together. In sum,
- Start by doing your homework. First, it’s internal: look around you and write down the problem that’s worth solving and how you plan to solve it. Second, it’s external: interact with those who might be interested in using your product. Third, check if they’re really interested; ask them to pre-order. If they don’t, keep meeting people until you learn what exactly is worth people’s money and time.
- Before you build the product, check if you could find pre-built solutions on Themeforest or build one using Bubble.
- Use Ship by Product Hunt to get people excited about your upcoming product. You’ll be able to get their feedback directly from your Ship page.
- Apply to companies that offer startup plans.
- Take advantage of first time subscriptions by extending durations. Companies typically offer deep discounts for first time customers only.
- Find partners who have codes to get discounts for the products you need. Most partners get commissions so you’d actually be doing them a favor by asking them for the code.
- Always check EntrePerks and AppSumo.
- Finally, as a bootstrapped founder, most of the time, it doesn’t matter how much you save when you can’t invest. So, use the money you earned from pre-selling to reinvest into your venture for hiring and product development. Most of the time, that amount is not enough. That’s when you should bootstrap by selling services.
You know what’s more valuable than all the things we discussed above?
It’s being continually and consistently informed. Knowledge builds up so always be learning. Remember how most CEOs read a book a week.
With the strategies I shared with you today, your savings as a bootstrapped founder will be way more than $10,000 but what I am more concerned about is the big wins. Those are 1, 2, 3, 5 or more deals that when you close either by pre-selling, selling your startup product non-scalably or using different bootstrapping strategies, you get set for a good period of time without worrying about funding the initial or later versions of your startup. Those are the wins that give you time to focus on your startup.
What I do is simple. I’m not funded. I self-fund my ventures through 2-3 projects a year. I offer to help entrepreneurs with their startups, they pay me, and I use the money to fund my own. When I started, with a very limited startup development experience, I used to do mini 10-15 projects a year. Today, I focus on less but bigger. Those are the big wins I referred to earlier. And those are in the Bootstrap a Startup Program (0 to $10,000). So, get on the wait list to know when the program opens and how to get started from now until registrations start.
BTW, if you haven’t joined our list of entrepreneurs yet, go ahead and subscribe below. As a member,
1) Once every week, I send you an email to ask you: if there is one thing I can help you with this week, what would it be? (advice, connections, support, etc.) Email me back.
2) Privately shared strategies, invitations, offers, etc. For instance today, we shared an effective way to leverage online communities (Facebook and LinkedIn groupes, Slack channels, etc.) to test and pre-sell new product ideas.
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Join me below and when you’re in, respond to my welcome email and let’s chat.
P.S. I am a partner with some of the companies I shared with you today. Some of these companies will share a % of their sales with me if you joined. The % is at no cost to you.