Why sell your software business if it’s wildly profitable AND you still love building great products for your customers every week with your amazing team?
Jason Fried is the co-founder and CEO of 37signals, makers of the popular Basecamp project management software, which is still growing and very profitable after 20 years.
Jason has long advocated for software founders to avoid VC funding and build sustainable businesses that are great for customers and generate healthy profits for the owners.
His best-selling book, Rework, shared his practical approach for entrepreneurs.
He’s among the most popular, prolific, and practical software entrepreneurs of the last 20 years.
And he is working in the business and still having fun as an engaged CEO, building great products with great marketing that stands out.
He created a style of life and a deliberate approach to his business that still works for him after all this time.
Being profitable and avoiding big funding has been key to his massive success and longevity.
Jason describes why he never raised big VC funding in our conversation on the Practical Founders Podcast this week:
“My sense of independence has always been important to me. That’s why I became an entrepreneur: to do things the way I wanted to do them. Otherwise, why be an entrepreneur? It’s true when you work, you’re working for your customers. That’s always going to be true.
“What people don’t realize is when you raise money, you don’t really work for yourself anymore. You really don’t. You work for someone else’s schedule, for someone else’s fulfillment, for someone else’s return. That never appealed to me.
“I want our products to explain themselves. I want our success to explain ourselves. I don’t want to have to explain myself on a quarterly basis to somebody who’s trying to get a return out of me. I’m not interested. So for all those reasons, it just wasn’t right to raise big funding.”
In our wide-ranging discussion, Jason also discusses these important topics:
- How the core principles of Basecamp remain focused on simplicity and essential tools for project management after 20 years.
- Why Basecamp targets small businesses, avoiding the enterprise market that many competitors chase.
- Why software should fit the needs of the user, rather than forcing users to adapt to complex tools for big companies
- How profitability, not growth, provides the freedom to innovate and explore new ideas.
- Why competing against your costs is more important than competing against other companies.
- How small teams have the agility to win against big companies.
Check out my in-depth interview with Jason Fried on the Practical Founders Podcast.
