The bootstrapped SaaS, from zero to…
SaaS success stories will make you believe millions will be made overnight. For the average bootstrapper, the reality is a little different.
Building a potential money-making machine can be an intoxicating journey, albeit a very slow one. Anyone who’s launched a product has felt that knot in the stomach that screams, “This wasn’t what all those success stories told me”.
Nusii is growing, but for my taste too slowly. So what can we do about it, if anything?
CONVERSIONS ARE GOOD
Michael and I regularly dive into our numbers, and when we do we generally feel pretty good about ourselves. Our visitor-to-trial signup is a respectable 2.4% and our trial to paid customer is 45%. Of course, this data is limited in its reach as we’re such a new SaaS. But as it stands, I think most any SaaS, especially a fledgling self-funded one would be happy with these numbers…So the problem’s not here (bare in mind we request a credit card to sign up).
THE SAAS SLOW RAMP OF DEATH
It was Gail Goodman who coined the phrase, “The Long, Slow SaaS Ramp of Death“. And boy was she right! SaaS is SLOOOOOW. If you want to make a quick buck then rob a bank. Software as a service won’t bring you a quick fix. The folks who launch to multiple thousands of dollars are in the minority. Even Nathan Barry has struggled to reach his original goal of $5K MRR. It’s taken him two years to get there.
I knew all this going in, but you’re never fully prepared for the slog.
Build it and they will come…If they know about it.
When people talk about month-on-month growth it can be too easy to make any old figures sound good. “Ye man, we have a consistent 20% growth, month on month!” The thing is, most folks are dealing with tiny numbers.
Say you launch your new service to a handful of customers: It’s launch day and you snag yourself 20 keen signups. They like your product, they stick around and you continue to grow 15%, month on month. These stats are awesome when you’re wearing your rose-tinted Ray-bans, but after a long 12 months, you’re still looking at a mere 107 customers! On one hand, congrats! On the other, it’s hardly gonna buy you that new house or even keep you out of consulting.
So what are you gonna do until you reach say, 300 customers? How will you live? I still have to take on the occasional consulting gig. In fact, I landed a new one today, thanks to Nusii
But you need alternative income sources until you’re able to reach the point where it all clicks. I’m publishing The Creative Professional’s Guide to Better Proposals shortly, and my hope is that it will help take up some of the slack. But whatever you do to keep the money rolling in, make sure it doesn’t take your eye off the ball. I’m speaking from experience when I say that just one week away from a new product can have serious ramifications for your traffic, signups and conversions.
So, I knew it was going to be slow and that we’d have to fight to keep our heads above water, but strangely it’s not our month-on-month growth that’s our biggest hindrance either (at least not directly).
CHURN’S A *”!*
Churn is the bane of any founder’s existence. If only we could keep each and every one of our customers. We’d all be very rich! But unfortunately it’s not the case.
There are several factors that affect our churn:
Not the right customer: From the very beginning Nusii was aimed at people like me. After all, I kind of built it for myself (I’m selfish like that). But of course, one creative professional is not like another. We all have different needs and thankfully different tastes. Not to mention that an independent consultant doesn’t typically have the same requirements as a Studio or an international marketing Agency. I still think we’ve yet to find our perfect customer. But that of course is on us.
Missing features: Regardless of where your product’s at, you will always have requests for new features. It may be that you have no intention of building these features or that you simply haven’t had time yet. Either way you’re sure to hear, “It would be cool if I could do this…” on a regular basis. Sometimes those features are a deal breaker, and hey presto, someone churns out. Of course, this can go the other way too. There’s no better way to make a customer feel special than by building a feature they’ve asked for. If it fits with your startup’s vision, and you can add it then go for it!
Either way, you’re sure to hear, “It would be cool if I could do this…”on a regular basis.
Too expensive: Again, it doesn’t matter where your product is at, it will always be too expensive for some people. Always. And that’s OK. Ye, some people sign up, give it a whirl and then decide it’s too much cash. It just means they’re not your audience. So is the price our biggest problem?
Nope.
AND WHAT ABOUT FAILED PAYMENTS?
No one told me that failed payments would be so common. Every month cards fail. The information you get back from Stripe can be vague, and getting clients to update their card details has turned into a SaaS business all of its own. But even with the dunning services that are available, we still lose money every month to failed payments. Yet again, this isn’t our biggest problem.
No one told me that failed payments would be so common.
So if we’ve got 99 problems and conversions, churn rate and failed payments ain’t one. What is?
IT’S A NUMBERS GAME
Build it and they will come…If they know about it.
It doesn’t matter how cool or useful your product is. It doesn’t matter how high your conversion rates are or how low your churn rates are. And it sure as shit doesn’t matter how many features you have.
If you don’t have enough traffic then you, or rather “I”, will fail at building a financially successful SaaS. You need those people hitting your site every, single day. Everything else comes after, and without that crucial level of traffic, you’ll be left floundering in the cruel SaaS sun.
AS ABOVE, SO BELOW
I was speaking to one of my mentors the other day and he asked how we got our first 100 customers. I replied, “Via the blog, you know, content marketing”.
His reply was, “Wow, you must have really fought tooth and nail for those”.
We did, and we continue to do so. Nusii is still very much an all-hands-on-deck kind of startup. Both Michael and I are involved in everything, which is how we win the support of our most fanatical users. We’re all in! But I digress.
Our blog has been running since early 2013. And in that time it’s been forgotten about on a couple of occasions. BUT, apart from those odd instances where I have dropped the ball, I’ve actually published content on a pretty regular basis. We’ve had some great posts, some regular posts and some posts that have gone on to achieve near viral status (at least in my mind’s eye).
And even so…
Our traffic levels are just way too low to keep us permanently off the consulting merry-go-round. Maybe one day I’ll go into our actual figures and you can see just what’s going on. But to be honest I’ve never been convinced by this wave of, “I’ll show you mine if you show me yours”. If you’ve read any of my previous posts then you’ll know that I’m pretty honest in what I write, but airing figures and numbers never really sit well with me. Maybe it’s my working-class roots.
WHAT’S A BOOTSTRAPPED SAAS TO DO
So what can we do? Accept our lot? No!
We’re looking at letting go of our content marketing altogether. It’s hugely time-consuming, and according to the figures we obviously need to improve somewhere.
Having someone else take over our content would be an awesome win, it will also be a very expensive one. I know just how much effort goes into writing good content, and having that done properly comes at a cost.
In the past, we’ve worked with some freelance writers but it’s never really been “right”. At least not all the time. We’ve also never had an overarching content strategy. It’ll be nice to see what one of those looks like.
So over the coming weeks, we’ll be working closely with Brian Casel of Audience Ops to up our game. I have all my fingers crossed on this one, and I’ll be sure to report back on how it pans out.
Another area we’re testing, which will hopefully make better use of the traffic we do have, is removing the requirement for a credit card during signup. Of course, making a credit card compulsory on signup has lowered our conversion rates, but it was always going to do that. And believe me, we’ve received our fair share of flack for doing this, but we have our reasons. I’ll be sure to go into those reasons in another post when I have some real data on how this experiment works out.
So our biggest problem?
Traffic. We need more traffic. You need more traffic. Everyone needs more traffic. Except for Baremetrics, I hear they’re doing OK.
