Challenges of a Boot-Strapped startup

My wife and I started enods.com (Earth Needs Our Dedicated Support)with one simple goal in mind — To help causes and non-profits compliment their fundraising efforts through various models of digital commerce. Along the way we have encountered stumbling block after stumbling block but our resolve to succeed has grown stronger with each challenge. Here, I will highlight some of the challenges we have faced.

Constant Ideation

I have always been a dreamer but about a year back I realized that my execution could not keep up with my dreams. My vision for enods.com was to make it an etsy type marketplace, but after putting in a significant amount of effort and resources to develop the initial product, I realized there were better and much easier models to launch with that could provide better CLTV. Furthermore, maintaining and scaling a marketplace with all the bells and whistles to compete with similar styled marketplaces would be near well impossible with limited development skills. As a point of note, the number of c2c marketplace failures has been on the rise of late and I am sure we will see fewer successes in that space.

My advice to new founders is to stay HYPER-FOCUSED on one product/problem with decent UNIT ECONOMICS

Unit Economics

Or a lack of understanding thereof has been one of our biggest stumbling blocks for us. We moved to a single product subscription model a few months back but are still in the process of figuring out favorable unit economics. Our coffee is sold on a monthly subscription basis (3,6 and 12 months) but our conversion rates and cost of customer acquisition numbers are not supportive of our business model — yet. We believe we are getting there but I wish google, twitter, FB and linkedin would offer significant credits to startups to test their acquisition models better. A notable investor told me that one should aim for CLTV(Customer Lifetime Value) which is 3–4 times greater than CCA. We are not close! But with some runway from the aforementioned channels, I do believe acquired knowledge of keywords and terms would help us get there.

In summary, I advise people to attempt to figure out their CCA as fast as possible and extend the Lifetime Value of the customer by building in a subscription component if possible — add to that great customer support and you have the making of good basic fundamentals. I also advise new startups to do the math on the number of subscription customers required to sustain operations and pay the founder a small stipend to survive on.

Platform Selection

We initially built our platform using Ruby, which for us was a terrible idea. We constantly needed to make changes and upload images and the global demand for quality developers was causing costs to go up steadily. Moving to wordpress/woocommerce was a great move as we could take advantage of a steady platform with great plugins and great content management capabilities. Ruby is great for custom applications but for simple ecommerce, go with something that has a low implementation time-frame. Also, we used a company called 5group.co who did a tremendous job executing with our fixed budget.

In conclusion

These are just a few of the issues we have faced here at enods, but as we begin to see the first semblance of growth, I am sure we will need to fix more problems and change our thinking on how we approach certain problems. But to all that are beginning their journey, the entrepreneurship journey is one worth taking :)