What do 100% of bootstrapped SaaS businesses that grow to $5M or $10M in revenue have in common?
These companies didn’t die, and they didn’t get stuck along the way.
At least half of the game of getting to $10M in revenue is staying alive and not stopping.
There are many ways to play the boostrapped software startup game. Infinite ways.
But if you dream of reaching $10M in ARR and selling it for a life-changing exit, you can’t stop at $500K or $1M or even $5M revenue.
All this usually takes more than 7 years. Often longer.
That’s long enough that you will deal with many things that can kill your company that you didn’t expect when you started:
- You can’t run out of customers and cash and have to shut it down. This is very common in the early startup journey, but nobody talks about it.
- You can’t be good at the getting-started game and not figure out how to grow a bigger and better business. Most startups don’t grow up, and they stop growing.
- You can’t live on the edge every month with no personal savings and no cash cushion in the company bank account. A couple of bad months will kill the company. This happens a lot.
- You can’t make crappy software and oversell it and expect to keep growing, no matter how hard you push. Also common.
- You can’t expect that more things will go right than go wrong and don’t work. It takes a lot of time and tries to learn and find what works.
- You can’t even expect that the SaaS game or exit game will be the same 5 or 10 years from when you started. Did you expect the AI shift or COVID?
- You can’t expect that your founders and leaders won’t experience health, family, financial, or mental health issues that threaten the whole thing. This happens too.
In the next 6 years, you have very high odds of facing multiple crises and brutal challenges that will stop you in your tracks.
You need to have sufficient capacity and buffer to get through it.
You have to build this in for when “passion” won’t be enough.
Maybe 15% of software companies that get to $1M ARR get to $5M ARR.
A software company that reached $5M in ARR faced multiple crises that killed other companies.
They got through it.
They kept going.
They didn’t stop.
They didn’t die.
They didn’t give up.
They did get stuck.
At least half of the game of getting to $10M in revenue in the modern software game is staying alive and not stopping.
Be deliberate about your ability to keep going when the inevitable storms come.
Keep going.
