Q: What happens when a founder creates a vertical software company that grows slowly and steadily with just a little outside funding?
A: The founder ends up being worth more than the VC-funded founders who told him he was doing it wrong.
My friend Dan Jaffe created LawLytics in 2012 in Tuscon, Arizona to solve a problem that his fellow lawyers had creating useful websites that didn’t cost a fortune.
I interviewed Dan in the latest episode of the Practical Founders Podcast.
He described his steady growth as a “slog.” But he grew the company to over $4M ARR before selling it to a strategic buyer in 2021.
People told him for years he should raise more money, charge more, sell and hype harder, hire people before revenues, go upmarket, and move to a bigger city.
But he didn’t do those things. He did it his way.
He wasn’t perfect either. He learned a ton from his mistakes.
I helped him over the last six years to grow his business and grow as a software CEO. I could see his big challenges and his steady improvement firsthand.
He funded the startup himself, then raised a little angel funding and a small seed funding round. Then he stopped raising money.
He also helped fund the company for a few years with a content-creation service that created custom SEO content for lawyers to attract useful traffic. This created cash and helped him understand how to help lawyers create content themselves.
I’m excited for Dan to have sold LawLytics to a great home where it can expand efficiently with its focus still on small law firms.
Dan showed me that you can change an industry and create life-changing wealth without being a “typical” aggressive funded SaaS company on steroids.
In this episode, Dan shared some great lessons for practical founders:
- What he did to find a great technical co-founder
- How their content creation service helped their larger customers and generated revenue and profits
- What it was like to compete with much bigger competitors to deliver a successful website marketing platform for attorneys
- The specific steps he took to sell the business in 2021 with the help of an M&A investment banking firm
Listen to this Practical Founders Podcast episode here.