From 0 to $1m ARR in less than 2 years and without any fundings
Bonjour my beloved readers ❤️
In the last few months, I’ve been a bit quiet when it comes to sharing our journey so I thought that nailing the $1,000,000 ARR milestone was a pretty cool opportunity to write an article 🎉
If you’re unfamiliar with traditional SaaS acronyms and metrics, make sure to check out this video ❤️
In my previous article about how we managed to reach $250,000 ARR in one year with lemlist, I detailed all our growth channels, failures and successes and quickly mentioned that we were also managing 2 other SaaS projects (lempod and lemtalk).
Since a lot of people asked me how it was possible to manage 3 SaaS projects with such a small team (at the beginning it was just François, Vianney and me — we’re now 8 in the team), I decided to share some insights in this article.
If you’re wondering, how much each project is making, why did we decide to work on multiple projects or how do we manage the growth and acquisition for each project, then keep reading because it’s gonna be entirely transparent and with 0 BS 😊
Because I love numbers, I’m gonna start with that! Here’s what our growth looks like:
Our numbers in December 2019 were split between each project as follow:
Total ARR: $1,000,000
If you look at these 3 projects you’re probably wondering why we’re not fully focused on one project in order to make the most out of it! Which opens the first chapter…
Why managing multiple SaaS projects? The rise of lempire 🙏
Before answering that question, let’s start with something you’ve probably asked yourself already. “Why the hell do all your projects start with lem?”
Well, because we wanted to have a certain coherence in what we do, we decided to name all our projects starting with “lem”. Our company is named lempire which in French could be translated into “THE EMPIRE”.
Obviously, the name is a little bit ironic 😅
Anyway, let’s get back to why we decided to manage multiple SaaS projects. At lempire, we follow what we called the LEM mantra.
(L) If you love what you do, you’ll never work one day in your life…
(E) Money doesn’t buy happiness but it can buy peace of mind and many other things that will make your life easier.
(M) Making sure that your customers and your team are happy is key as building a company is a long journey. If both your customers and team lose faith in what you’re making, the chances of success get smaller.
Even though the traditional model of building a company would be to focus only on one project, we decided that testing different market opportunities could also be interesting.
Our decision was based on the LEM mantra explained above especially since we (Vianney, François and myself) looove building new SaaS projects that bring value.
Obviously, since life is not always a bed of roses, I’ve decided to list the pros and cons.
Pros of working on multiple SaaS projects
1- Learn a lot.
If there’s one thing we have in common with Vianney and François is that we love to learn new things.
If you’ve been working on growing businesses you know that each project is different. However, and we will discuss that in more details later, I noticed that in order to grow profitable businesses there are things that can be processed and that execution is key in any market (competitive or not)
2- Minimize the risk of failure of your business.
I know that most people would disagree with that statement but hear me out. If you look at all investment courses, you’ll see that it’s super important to diversify your investments to limit the risk.
As my grandmother would say, you shouldn’t put all your eggs in the same basket (love you, grandma ❤️).
Most VCs would tell you to fully focus on ONE project while they would invest in many different projects in order to minimize their own risk…
Interesting right? It reminds me of the saying “do as I say not as I do”…
For those of you who knew I was the co-founder of lemlist, you probably clicked on the different links at the beginning of the article to check what lempod and lemtalk were doing… Well… that’s a bit the same with cross-selling. Targeting audiences that can overlap is usually a really cool way to do cross-selling and enjoy the compound effects.
A lot of time, cross-selling happens naturally via my LinkedIn profile where I mention all the projects I work on 👇
Cons of working on multiple SaaS projects
1- You can easily lose your focus.
I’m not going to pretend that being fully focused on all projects is doable because it’s not. As human-being, being 100% focus on one project will most of the time result in stronger growth overtime.
2- It divides your resources.
In the early days of a startup, all your resources are key in order to develop both the tech and the business side.
3- It’s a real management challenge.
Which feature are you going to prioritize? What resources are you going to allocate and on which project? How to manage multiple people on different projects etc…
Based on these pros and cons, a question that I often get is how do you choose on which side project you’re gonna start working before defining if it’s a viable business or not. Which opens the second chapter 🍾
Make something YOU want
If you’ve been watching a few of the very well-known videos, interviews or keynotes from the famous YC founder Sam Altman, you must know that in order to build a successful startup you need to “Make something people want”.
In my opinion, I think that this mantra applies to every single unicorn but becoming one is not always everyone’s goal.
Make something you really want is the best way to get started with side-project marketing and eventually start running profitable businesses!
If you take the example of lempod, that’s exactly what we did.
I initially was in a few LinkedIn engagement pods and I realized that engaging on everyone’s content (like AND comment) was really time-consuming…
Because I hate doing repetitive tasks, I started discussing with my two co-founders and tech geniuses Vianney and François in order to evaluate the complexity of creating a chrome extension to do that automatically.
72 hours later, they built an MVP 😅
A week later we had 100 users — You can actually find out more about this story here.
As you can see, I didn’t do any proper market research, I didn’t spend ages talking to potential customers nor run in-depth customer interviews…
We just built a project and launched it because that was something WE wanted.
Eventually, we realized that other people had the same need or didn’t have the exact need but were seeing the value in what we built.
After 2 months and a half in Beta, we decided to start charging for that side project.
10 months after billing people that project was making close to $19,000 MRR with very few resources invested.
When I started my entrepreneurship journey, I realized that even though people were continuously telling you to think outside of the box, everyone was in the same box. One team, One project.
People would say that running several projects doesn’t make sense for a small startup…
That “focus” was the key to so-called “success”…
But what about doing something you’re really passionate about?
Never forget that the definition of success shouldn’t only include how much revenue your startup is making.
You should include your happiness, your well-being and the well-being of your employees, the happiness of your customers and all these little things that make you a human being and not a P&L statement.
Never forget that we’re all different and that some people are able to be focused on one single project for years without losing motivation but others prefer working on different projects at the same time just because it’s part of the long term fun…
I’m not saying that everyone should stop working on a single project and go on multi-projects, I’m just saying that you never know what a side project can become and that if you need to blow off some steam from time to time and work on side projects, then do it 😊
Going back to the main title of this article you’re probably wondering why we decided not to raise any fundings so far, and that’s actually what we’re gonna discuss in the third chapter 💸
VCs or Bootstrapped?
I will always remember that feeling when I started my entrepreneurship journey, reading articles in TechCrunch, The Next Web, The Verge or all these tech media — In order to build a successful company, you need to raise money.
At least, that’s what I thought….
Success and “fame” (essentially what you can call PR) were to me, linked to that amount of money VCs or investors will give you to fuel the growth of your startup.
And when I was thinking about bootstrappers (people who don’t raise funds for their business), I would think that these people didn’t raise funds simply because they couldn’t.
I’m not going to pretend that I’ve always followed the bootstrapper mindset because that wouldn’t be true.
I met with a few VCs when we were pre-revenue as I was convinced that we needed funding to succeed.
However, after spending time building pitch decks and business plans I realized that I was wasting my time on things that were not bringing value directly to the business I wanted to build.
I then decided to focus on working on things that would bring meaningful results with profitability as the only metrics I’d focus on.
2 years later, I’m receiving several emails each and every week from VCs and business angels from all over the world.
The 3 reasons why we never wanted to raise funds were the following:
1- We want to fully control the company (We don’t want to work for investors)
2- We’re highly profitable and we don’t need more money (As Biggie say: “Mo Money, Mo Problems”)
3- We never met with investors who were really doing the extra-mile and showing us that they would become REAL business partners and not just investors.
Overall, I’m not saying that raising funds is not something to consider but I just feel that you should understand that it will not be linked to your success as most media try to make us believe.
Some of my founder’s friends have raised money and have faced things like down round, bad exits, or even sometimes bankruptcy because they’ve raised too soon or with the wrong investors.
Others have had excellent relationships with their investors leading to super successful exits or business growth…
There’s no right or wrong way to do things but at some point, you always need to remember that VCs will give you money in order to make at least 10x on their investment.
This will have severe consequences in regard to your growth strategy and on the risks you’re taking.
I’m not saying that you shouldn’t raise funds under any circumstances, I’m just saying that you should always understand the pros and cons.
Another topic that I wanted to discuss here is the fact that when raising funds, you have to hire more people and in my opinion, this is the hardest part of any business… And that opens another chapter 🎉
Hire fast — Fire fast | Is small always beautiful?
As I mentioned at the beginning of this article, before growing our team to 8 people, it was actually just Vianney, François and me, managing 3 different SaaS projects 😅
Our vision has always been that hiring too many people will ultimately lead to a loss of agility and eventually in us spending more time managing people rather than doing things we love 🤦🏻♂️
But then it all happened pretty quickly…
Vuk cold emailed me in order to work for us…
I said no.
But then he offered a sample of his work for free…
Knowing that I’m a French cheap bastard 🇫🇷🥖- that Serbian dude got me…
I had to say yes! After nailing his assignments he quickly became an essential asset of the company helping me growing lemlist ❤️
For the next recruitment, I followed the precious advice of Appsumo’s CEO, Ayman Al Abdullah:
If you want to keep your team small, only hire people when it hurts.
I will always remember our chat when they flew me over to Austin in order to help me out on the business side 🙏
If there’s one thing you should know about Appsumo is that their revenue per employee is higher than the one at Facebook 😎
So when it comes to efficiency and business growth, trust them!
When it comes to customer support, we quickly realized that we were spending hours every day talking to our customers and that at some point we had way less time to work on the more strategic aspects of the business. Feeling that pain we decided to hire Ena as our second team member in order for her to own customer support.
That’s the time where I decided to put a lot of structure in every single thing that we were doing at lemlist — sales, support, SEO, cold emailing, LinkedIn, Content distribution etc…. I decided to build a process for everything and I will come back to that a bit later…
Since more growth managers mean more tech needs, we also decided to hire our first developer.
The struggle here is that when it comes to growth and acquisition if you do a mistake it will probably not get noticed. For example, a bad article will simply not rank or not be read by visitors...
However, when it comes to the tech side, if your code is buggy or if you fuck up something in the existing code, everyone will notice it…
And well… that’s kind of what happened multiple times in the first month of the developer we hired…
Here again, we had two options, help him get better at what he does OR fire him and find someone else. Because we noticed that he was not a good fit and that the learning curve was too steep, we decided to fire him.
It might sound harsh but if you want to keep your team small and agile you need people that can learn fast and that are adaptable.
If it’s not the case, it’s better to fire that person as quickly as possible or you will have to pay for it one way or another.
So, is small always beautiful?
In my opinion — yes!
The longer you stay small, the better you’ll understand all the Ins and Outs of your business.
I see way too many founders that are not putting the work and that scares me.
How can you run a company if you haven’t done support? If you haven’t closed any deals? If you’re not driving growth continuously?
I strongly believe that you need to lead by example and when you’re small you have no other choice.
For example, Vianney and François are still spending a lot of time coding new features when they could delegate and focus more on the bigger picture.
For me, a great way to lead by example was to build processes and show people how to do things in a very actionable way — which leads us to our final chapter, building process early!
Building processes early
When I talk to friends who are working at bigger companies or startups, I’m terrified by the lack of clear processes and overall loss of information when it comes to transferable knowledge within the same company.
Because managing multiple projects require a lot of organization, I decided that processes were going to be the cornerstone of our growth and thus, from the early days.
My hypothesis was that by applying the same processes and growth playbook to multiple projects, I’ll be able to replicate successes and avoid some of our failures…
If you’ve been talking to me in the past, you know that I’m in love with Notion 😍
It’s one of the tools that has allowed us to really step up our game when it comes to managing processes, roadmaps (both on the tech and marketing side) and growth experiments…
We created a dedicated section of our processes.
At the beginning of each section, it’s important to always put the goals so anyone can understand in a second what he’ll expect if continues reading.
On top of that, we decided to split the document by acquisition channel.
As you can see we decided to only put the acquisition channels that we either really master (Email outreach, Community & LinkedIn) or that we want to get good at (SEO) — and for each channel, we decided to build clear and actionable processes that were easily replicable.
As a small team, it was key for us to focus on the channels that we master. On top of that, you would notice that for most channels, we’re actually using our own tools.
Eating your own dog food is, in my opinion, the best way to understand the pain people are having and it pushes you to always improve your product over time 🚀
I’m not gonna lie, being profitable and do something we love is really a sweet spot!
The fact that we have no pressure when it comes to growth or numbers really allows us to set up ambitious goals while taking a step back to only focus on what matters the most.
Our focus for 2020 is to make our users even more successful and happy!
We want to spread the word globally that B2B doesn’t have to stand for boring-to-boring ❤️
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Love you all ❤️