What exactly is user acquisition, and how can you secure your first 1,000 users for your B2B SaaS venture? This process requires SaaS founders to meticulously craft products with the end user in mind. Establishing a minimal, lovable product before embarking on user acquisition stands out as a pivotal step in this journey. Shedding light on this crucial aspect, show host Joran Hofman engages in a conversation with Simon Hoiberg, the esteemed founder of FeedHive. Simon is widely recognized for his expertise in initiating and managing small, bootstrapped self-serve SaaS products, boasting a successful track record of building multiple SaaS businesses.
What is User Acquisition?
Simon defines user acquisition as the process of getting users to start using a SaaS product through various channels, which often involves a cost. He highlights the importance of having a method associated with user acquisition and the need for a minimally viable and lovable product to attract early users.
Minimum Requirements for User Acquisition
SaaS founders particularly have the tendency to focus on building a product before acquiring users. Simon emphasizes the importance of having a minimal, lovable product before acquiring users. He cautions against the common mistake of building a product first and then attempting to find users, emphasizing the importance of designing a product with users in mind.
Simon’s User Growth System
- Stage 1 – Acquiring Early Users
Simon presents a three-stage user growth system.
- Stage 1 – The early First time users
In stage 1, he advises reaching out to a small network of contacts, offering early users free lifetime access to the product, and creating a community of early adopters to gather feedback and shape the product. This first user play a crucial role as considered as first stage affiliate marketers of your product.
- Stage 2 – The content creation Game
Stage 2 focuses on broad adoption through organic content creation and inbound methods. Simon emphasizes the importance of a sustained content strategy, such as blog posts, videos, and speaking engagements, to attract a larger user base over time.
- Stage 3 – Scaling and Advertisement
The final stage involves scaling the user base through paid advertising and affiliate marketing. Simon discusses the transition to using advertisement and emphasizes the need to understand the financial metrics of user acquisition, including the average lifetime value of a user.
The Challenges and Obstacles faced while implementing user acquisition
Simon shares the challenges of learning to run effective advertisements and the importance of experimenting and learning to optimize ad campaigns. He advises starting small and gradually scaling up ad spending.
How Simon Runs His Team: The Delegation Approach
Simon explains his approach to delegation, focusing on task delegation rather than delegating entire areas of responsibility. He emphasizes the importance of being fully involved in all aspects of the business as a founder. He also underscores the need for bootstrapped founders to get their hands dirty to help save on scarce financial resources.
Simon’s reason for staying bootstrapped
Simon shares his perspective on remaining bootstrapped and avoiding external funding, highlighting the autonomy and control that come with running a self-funded business. This approach allows him to be fully in charge and not answerable to a third person in the day-to-day running of his SaaS.
Advice for SaaS Founders
As for SaaS founders, Simon points out and emphasizes the need for persistence, sticking to tried and tested strategies, and maintaining an active and involved presence in the business, particularly during the early stages of growth.
- (0:37) Show and guest intro
- (1:20) Why you should listen to Simon Høiberg
- (2:10) What is user acquisition?
- (2:52) The minimum business requirements for User acquisition
- (3:19) When to think about acquiring users
- (5:24) The most common mistakes companies make while trying to acquire new users
- (6:21) Exploring Simon’s User Growth System: A Journey through its Stages
- (8:32) Stage 1
- (12:23) Stage 2
- (15:07) The stage drop off effect
- (16:07) Stage 3
- (21:33) Common challenges and obstacles faced while implementing user acquisition
- (23:39) How Simon runs his team
- (24:46) Why Simon Prefers Handling Everything Personally Instead of Delegating to His Team
- (26:28) Simon’s reason for staying bootstrapped
- (28:33) How to grow towards 10K MRR
- (30:25) How to grow towards 10 million ARR
- (32:08) Simon’s crucial advice to B2B SaaS founders
- (32:43) What Simon Wishes he knew 10 years ago
[00:00:00.250] – Intro
Welcome to the Grow your B2B SaaS podcast. In this podcast, we cover all topics on how to grow your B2B SaaS, no matter in which stage you’re in. I’m joran Hofman, the host of the show and the founder of Reditus, which is a B2B SaaS that helps other B2B SaaS companies to set up, manage and grow an affiliate program. Being a founder myself means I’m going through the exact same journey as you are, experiencing the exact same issues and probably have the exact same questions. And this is why I started the podcast in the first place. Get advice from industry experts on how to grow my B2B SaaS. So if you like this content, make sure to subscribe. Follow give it a thumbs up. Let’s just dive in.
[00:00:37.820] – Joran
In today’s episode, we’re going to talk about user acquisition. My guest is Simon Hoiberg. You probably have seen some of his content already as he’s really active on LinkedIn and YouTube. He has 100,000 subscribers next to creating the content. He runs three SaaS businesses, feed, hype, link drip and eight base. He’s still bootstrapped, has a team of nine which are purely contractors.
[00:00:59.000] – Joran
So technically he has no employees. And through building these multiple SaaS businesses, he’s built a user growth system for himself which he uses to launch and scale these businesses which are now doing combined over 1 million ARR. Today we’re going to walk through his growth system so you can basically copy things from it. Welcome to the show, Simon.
[00:01:18.370] – Simon
Thank you very much. It’s a pleasure to be here.
[00:01:20.480] – Joran
For people who haven’t seen your content yet or don’t know you yet, in your own words, why should people listen to you today?
[00:01:27.420] – Simon
That’s actually a very good question. I would say I tend to speak to a fairly narrow group of people doing something quite specific, and that is starting and running small bootstrapped self serve SaaS products. What I can say is that I very rarely speak about things where I don’t have any expertise or any experience firsthand. The reason you might want to listen to me is that you can be very sure that whenever I say something or give advice on something, it is something that I at least know a little bit about.
[00:01:57.480] – Joran
Yeah, and I think you’re going to have a lot of followers because everybody wants to stay bootstrap, right. And build a self serve sauce. So I think that’s why you really picked a really good niche.
[00:02:05.730] – Joran
We’re going to talk about your growth system, basically like acquiring new users to go to the basics, can you explain what user acquisition means in your words?
[00:02:14.730] – Simon
At its most basic form, a user acquisition simply means getting a user to start using your SaaS product. And with a user acquisition, you need a channel. So you need to reach this user through somewhere. And it often also comes with a cost. Not always, but it typically does. And in the way I normally see it, there is also a method associated with user acquisition, and that is the approach you’re using to find that user through your channel. And we can get into that a little down the road here.
[00:02:48.940] – Joran
Yeah, so basically like acquiring users for your SaaS general cost method, but what has to be minimum in place before we could even talk about acquiring users, which we’re going to talk about today.
[00:03:00.160] – Simon
I think the minimum definition we should have is that remembering that acquiring a user has a channel, it comes with a cost, and there is a method that we can use to actually acquire them.
[00:03:11.580] – Joran
And when you look at it from SaaS perspective, what is your view on? Do you have to have a mock up, an mvp, a fully working product, I guess. When can you really think about acquiring users?
[00:03:22.810] – Simon
This is such a great question and it’s actually one of the most common mistakes I see from a lot of companies when they start doing SaaS products. We’ve heard a lot about lean startup. This has been around for at least the last 1015 years, but still this is the most common mistake I see. People tend to think that they have to build a product and then they have to get users for that product, like a sequential thing in that order. And the problem is that if you think of it like this, you go out and then you try to acquire users for your product instead of trying to build a product for your users. And this is the most common mistake I see. So what you should do is you should build a minimum version of your product in previously you tended to call this an MVP, a minimum viable product. There’s a new term that is being used a little bit more often and that’s called a minimum lovable product. And I really like this term because it describes exactly what you need to get the very first version of your product in the hands of the first few users.
[00:04:23.310] – Simon
You need to have a product, but it needs to be an early stage product because you don’t exactly know what you’re going to be building yet. You still do need something that is attracting attention. Having something that is minimally viable is not quite enough. You need to have something that also gives a certain level of wow effect with the first initial users. We have to remember that in our day and age, there are SaaS products popping up absolutely everywhere and everyone is chasing the users. It’s no longer the users trying to find the right SaaS product. So we need to give the very early users a good reason to jump on to an early product. And that’s why we need to make it minimally lovable.
[00:05:06.040] – Joran
Yeah, love it. Because people love it when you either fix their problem, drive value for them, do something, so they’re going to be in love with your product. So it has to be viable. It has to be lovable. I like it. This is already coming into my next question. You mentioned this is one of the most common mistakes, right companies make while trying to acquire new users. Any other common mistakes companies making?
[00:05:27.300] – Simon
I think it’s mostly that and it’s some kind of version of problems that are centered around that users going out and thinking that as long as they have a really solid product, according to the founding or the founding teams or the founders themselves, they will find users somewhere. And because running advertisement and targeting through social media, it became so good. So we can often get this impression that whatever we’re going to build, there’s going to be some users out there who wants to use exactly my version or the version that I have built. Right. And this is a massive pitfall. It might be true in some cases, you might be able to get away with doing that, but in most cases you will get much further if you built as little as you can, just enough to attract the first initial early users and then use these users to form the product in the longer term.
[00:06:15.710] – Joran
Yeah, and I think we’re going to maybe dive deeper into that. So we’re definitely going to maybe find some common mistakes there as well. You have your user growth system, right? You use it for your own SaaS businesses now doing combined over 1 million ar. Can you walk me through it? Are there certain stages? What is the process? Can you just guide me through it?
[00:06:33.330] – Simon
For the user growth system that I have been using now, for all three products that I have launched, it has three stages. And the first stage is actually the most important one. And it’s often the one where most founders already jump off the chain. So before I mentioned that when you acquire a user, you can use a method. And how I see it, any marketing related to getting users online in the digital world can be classified into four different methods. So there is either the outbound method or the outgoing method. That means that I, as the founder, I try to reach you as the user. So I do cold dms or I do cold email, or maybe I even do cold callings or call you up and try to get you on my SaaS. These are all the outgoing method, and similarly there is an incoming method. So that is me putting content out there, putting blog posts any way where the people will start being attracted to my product and see my product, and they will come to me in more of a self serve manner. They will come and sign up for this product because they think it’s good.
[00:07:38.280] – Simon
And then there is referrals. That is simply when I get my current users to refer new users. This can happen through affiliate programs or if you incorporate a viral loop into your product, so there is some subtle branding on your product. In some ways, then you have referrals, and finally you have advertisement. An advertisement is similar to the incoming method where you use content. The only difference is that here you strictly pay someone to put that content or that ad in front of other people. This can either be by using Google Ads or Facebook ads, or it can also be by paying other creators by sponsoring their content, and in that way pay to get your word out and get that in front of other users. So knowing that there are these different methods, I use different methods in different stages in this growth system. So if we jump back into the first stage, in this stage, you want to get the first 510, 25, maybe even up to 100 users. And at this point, your SaaS product is early stage, it’s minimal, lovable, so it should be a good but very small and very limited product.
[00:08:54.360] – Simon
And at this point, you want to get the first five to ten users on board. And the best way you can do that is to use the outgoing method. So this means you simply reach out to people in your close network, previous people you’ve worked with, like early colleagues, and you reach out to them and you tell them about this product that you’re using and that you really want them on board. And in this particular case, I would recommend simply giving away a lifetime for free on this product. Again, people are bombarded with SaaS products they should use all day long. So give these early users a good reason to jump on board early, and I would suggest simply offering them a lifetime on the product for free. And if the product is associated with a high level of friction, if there’s a high investment to get in, you can even consider paying your first users to start using it. And I know some people out there, they will say, oh no, Simon, you should never do this because then you’re devaluing your product in advance. At this first stage, I highly disagree. I don’t think you’re devaluing your product.
[00:09:56.980] – Simon
I think you are accurately valuing how important these first users are because they are fundamental to the success of your product. And once you get these 1st, 510 20 users on board, you’re going to create a small community. It can either be a Facebook group or a WhatsApp chat group or a discord. I remember when I was launching feed hive three years ago, one of my SaaS products, we had a Twitter chat group that was basically it. And we were 20 people in there. And now you’re going to listen to these users, early users, and you’re going to take all the feedback you can get from them, really let them help you shape the product. This is great for multiple reasons. First of all, you actually have users now telling you what they want instead of you just speculating or trying to guess. But secondly, these first initial users, they will also really feel that they’re a part of the project. They will feel a bit special. They will feel that they help shape this maybe soon to come huge product that will come out there. And this is important because if you want to scale that initial five to ten users and make that, say, the first hundred users, what you can do is that you can have your early adopters actually help get new users in.
[00:11:07.300] – Simon
So give them some sort of voucher or discount code or something that they can go out to their friends or their network and say, there’s this cool product coming up. I’m actually part of it. I’m a partner in this project. I can get you in for free or for like half off or give them a good reason to bring in these new users. So now in stage one, you have actually a combination of the outgoing methods where you reach out to the users and bring them in, and a referral method. It’s not like an affiliate program per se, but you are trying to get the very first initial users to become ambassadors and you’re going to try to have them help bring in new users.
[00:11:42.810] – Joran
Just to conclude, I guess, make sure you know exactly, I guess, the methods you’re going to use. So just to summarize, outbound incoming referrals and then advertisements, which is paid incoming, get your first minimal, lovable product, give it away for free, even, maybe even pay people. But people have to start using your product to see the actual value. Turn them into your community, so get feedback, make them feel special. So you can turn them into ambassadors, which is going to help you to get them to refer you, basically. So it doesn’t have to be affiliate marketing. Give them a reason to refer you, give them extra credits, give them a discount code for the people they’re referring to. So I hope I summarized stage one.
[00:12:19.420] – Simon
[00:12:19.880] – Joran
Then let’s move on to stage two. Where are we at right now?
[00:12:22.880] – Simon
Yes, stage two. Let’s say that you have been doing stage one for a while, maybe two, three months, and you’re shaping something that now looks like a product that you can go out there a little bit more broadly to people that don’t know you and they’re not in your network, they’re like stranger people on the Internet. Now you want to take this product and make a bit more of a broad adoption of new users. This is stage two. And here I always recommend using the incoming method. And the incoming method again, that is where you put content out there and then people see that content, it leads you to your website and they will go and sign up in a self serve manner. And this stage two is very long and very hard and it can be very demotivating because you need to create content, you need to create blog posts, you need to create YouTube videos, and if you’re into speaking engagement, you can go out and stand like a habit booth and try to spread awareness around your product like that. But this is where the grinding phase really begins because this is long and hard.
[00:13:23.010] – Simon
However, you will tend to see that the efforts begin to accumulate. So you will see this compounding effect when you start doing this. But if you allocate maybe a year, maybe even two years on just creating awareness organically through content, you should be able to get, I would say, somewhere between 200, 300, 500, maybe even the first 1000 paying users in this way. And I know that there are some people that say, but why don’t you just use the outgoing method on stage two? Can’t you just hire sales team? Can you do cold dms or cold emails? And you absolutely can. Then it’s just not really a self serve SaaS anymore. But there are definitely SaaS products that do this. And I think if you have a lot of money, if you’re vc backed, you can afford a sales team to sit and do cold calling and at scale bringing in people like this, it’s just a different type of product. So I would say if we stay in the bootstrap self serve genera of SaaS products here, then the incoming method for stage two is definitely the best one.
[00:14:22.440] – Joran
Yeah. And I think also, as you mentioned, it’s a long grind right. If you’re going to do like, organic content creation, it is going to take a long time. Like the same what we’re doing now with this podcast. We started from nothing, of course. We now have 44 episodes, and we start now to see the compounding effect. And it might have an effect on Reddit soon, but probably not right now. So even I guess we’re still in the content creation where we won’t get much out of it, but at one point we will. So I guess that’s like a real practical example. And for yourself as well, you’re now growing three SaaS businesses. You have 100K subscribers on your YouTube channel. So every time, I guess you build a new SaaS, which is probably going to happen because you already have three, you’re going to start with something already, like a really good basis. So it’s compounding for yourself as well.
[00:15:06.240] – Simon
[00:15:06.920] – Joran
Nice. You mentioned in stage one a lot of people drop off. How many people do we have left in stage two? Because this is a long ride, as you mentioned. Are people dropping off here a lot or they do survive this stage, would you say?
[00:15:18.970] – Simon
I would say that I would put a lot of effort into trying to keep the people from stage one also, throughout the other stages, keep that initial group of early adopters very close. They’re still going to be insanely valuable also going forward. So I would try my best to not have too big of a drop off on this particular group of users.
[00:15:40.820] – Joran
Yeah, makes sense. This podcast episode is sponsored by redditis. Redditis helps B2B SaaS companies to set up, manage and grow an affiliate program. In short, it means you’re asking other people, affiliates to promote your SaaS. You would only pay the affiliates a kickback fee when they deliver you paid clients, making it a very cost effective and scalable way to grow your MRR. See [email protected] and I think there’s also stage three, right? So we now passed 10,000 paid users, somewhat like that. Where are we going now? What are we going to do?
[00:16:15.510] – Simon
Yeah, in stage 210 thousand is probably high for stage two at least if we’re only doing this for a few years. If it’s going well, we have somewhere around 1000 paying users now. It’s a good time to enter stage three. Stage three does not mean that you should now stop doing stage two. You should keep doing this incoming method, this content and organic traffic to your SaaS and to your website and so on. But stage three, this is where we want to start developing something that we can scale a little more easily. Now, we have done two years of stage two, which if you are one person that can create so much content, there is a limit to how many eyes you can get on you. And in stage three, we want to try to change that. So there are two methods you can use for stage three. One is advertisement and this is an obvious one. You can take some of all the content that you have been creating for state. In stage two, take some of the content that perform particularly well and then reuse that and turn that into advertisement, and you will create new ads as well.
[00:17:18.990] – Simon
And now you have the potential to reach a completely new level of users online, because advertisement, you can press a button and it will scale almost infinitely, or at least as many people there are online and on social media. And I think this is my preferred method. This is the one I’ve been using for all my products. I always end up turning some of my content into ads to reach this new level. What’s important to know about stage three and why I have been waiting to do advertisement until stage three is that it often costs more money. So now you have one of the highest cost channels when it comes to acquisitions, and you need to, first of all, have the funding to start running ads. You’re going to be wasting quite a lot of money because you’re going to be experimenting with ads to see how they perform. But it’s also very important that how much you can afford to post into one acquisition. And this data is something that you will get throughout these last one, two years. So when you study your financial metrics on your SaaS, you will know what the average lifetime value is for your user.
[00:18:21.810] – Simon
So all SaaS products have churn, and we can use that to calculate what is the average amount of money one user spends with your SaaS before they leave. And you obviously want to make sure that the cost of acquisition for one user when running ads is less than the average lifetime value that you get for one user. And if you make sure this math adds up, you can now go into an advertisement model where you can post in. If you’re in growth mode and you really just want to scale, you can take almost the full amount of the average lifetime user value for a user. Just post that into being willing to get one new user for that with ads. So that’s one way you can do stage three. Another one is using the referral method. And here I would suggest using affiliate marketing. There are already a lot of great tools out there that can do affiliate marketing at scale. So this is a completely different way of doing this. But here you will take your current users and you will turn them all into affiliate partners and they will go out there and they will promote your SaaS this way.
[00:19:22.320] – Simon
And once again, if you’re in growth mode, you can offer a very generous affiliate program. I’ve seen some tools offer up to 50% of all recurring revenue for every user they refer. Ongoing, recurringly that’s very high. But if you’re in growth mode and you really just want to scale, you can create some very solid incentives for your users. It could also be much lower than that. If you’re getting to stage three and you’re a little bit more, you want to put your business a little bit more in automation, you want to free up more time and not do as much content as you did in stage two. Not so much grind both with ads. You can decide to say we’re going to lower the ad budget, but we just want enough that we keep growing. And with affiliates you can have a less generous agreement with your affiliate partners. That could be some in app credits or gift cards or just paying lower. Then these affiliate partners won’t be as incentivized, they won’t be as aggressive when they go out there and promote your product, but it will be enough for you to grow at a decent level for stage three.
[00:20:17.400] – Joran
I love it. To summarize this one, keep focusing on the inbound method and then start working more towards more scalable solutions like running ads and affiliate marketing. And then when you dive deeper into running ads, use the existing contact which you had. In stage two, it is going to cost you more money to run this channel. But at this stage you probably have the money or need the money. But before you do, make sure you know your numbers. Get your CaC LTV numbers in order, you know exactly how much you can spend. And then when we look at affiliate marketing, of course, check out Redditis first before you do anything else but leverage your first users and then start offering them a generous affiliate program. Do your numbers again, do your customer acquisition cost and LTV. So you can also see exactly what kind of incentives can you give towards your affiliates. Reddit is an affiliate management platform. We help SaaS companies to set it up but also find new affiliates. So we have a database of at the moment like 7000 B, two B SaaS affiliates, but we always recommend them as well. Don’t do it at the early stages because you probably don’t have people who actually want to recommend you for money.
[00:21:20.830] – Joran
So only do it when you’re in.
[00:21:22.270] – Simon
Stage three, I would say stage three is the one that can keep going indefinitely. And from here, there are no limit to how many new users you can get.
[00:21:29.580] – Joran
We now have the framework right. And the way you always walk through this, you always make it sound easy, right. But I think you always run into challenges, obstacles. So what are some of the typical ones you see you face yourself, or maybe other people faced it while implementing this. And how did you overcome those?
[00:21:46.070] – Simon
One huge challenge that we were facing was learning how to do advertisement well, because first of all, it’s quite difficult to get it right. One thing is to get the format of the content right, but another thing is understanding how these different advertising platforms actually work behind the scenes. This requires quite a bit of experience and a lot of experimentation. We ended up burning quite a lot of money on this behalf on things that just didn’t work. One advice that I would give is while you’re in stage two and you’re doing content, you’re already now laying the foundation of learning how content performs well. And if you are getting really good with content, most likely you will find it easier to find ad creatives that perform well. But I would slowly start experimenting with ads already in the stage two phase, but without the objective that it necessarily needs to convert and that this should be a channel that is going to work for you, but allocate a bit of your money to say, for the next six months, we’re just going to blow this money on learning how to do ads. But it’s better to blow a smaller amount of money in a sandbox playground kind of environment.
[00:22:56.990] – Simon
And then once you get to a point where you want to scale ads, you don’t need to pick up from scratch and learn everything. We learned this the very hard way with feed Hive, my first SAS products, and already when we got to the second SAS, I rolled, and already now we’re starting to do a little bit of ad rollout. On the latest one, I rolled out eight base and it becomes significantly easier over time. So one challenge is that, yeah, and.
[00:23:19.470] – Joran
As you mentioned, it doesn’t have to convert into paid users, which is counterintuitive just because you want to acquire paid users. Right, and you want the channel to work because otherwise why would you scale it up? But you’re basically saying, like, experiment, see what’s working, see what isn’t working, use the content you have, and then you figure out a way to make it work, basically.
[00:23:38.060] – Simon
[00:23:39.020] – Joran
So you’re purely doing it now with a team of contractors. Right. So is there, for example, one person fully dedicated on running paid ads, or is it more of in this bucket as in doing growth marketing in general?
[00:23:50.420] – Simon
Yeah, there is one person fully focused on that, and that would be me. The way I run my team is this is a thing that multiple people do differently and then some people can disagree with that or not about. I’m quite the single point of failure in my company right now. So I don’t delegate a whole lot of full responsibility areas. I delegate tasks. So that means I have someone to help me with creating graphics, someone to help me edit videos, someone to help me write some of the content. I have someone to help me develop. But I am still the one in charge of setting up the ad campaigns and making sure they run as they do, putting the final videos together that will go on YouTube. I also set up the code base. I’m a software developer by background, so I have developers who help me, but I approve each pr, so on and so on. And this is how I run my team. Other people might find a different way where they can delegate whole areas of responsibilities to certain team members. I wouldn’t say one is necessarily better than the other.
[00:24:45.680] – Simon
Both can work well.
[00:24:46.700] – Joran
Like you’re a solo founder, right? You do everything yourself, as you mentioned. So you delegate tasks, not projects. Like what is reasoning behind this? Is there something which led to this, or is this just how you like to work?
[00:24:57.340] – Simon
That’s a good question. I think one big reason obviously, is the financial aspect. At it, you can outsource and delegate tasks at a more affordable level using tools like upwork and fiver to find people who are great at doing task level things. They execute that really well. They might not be that good at planning and managing and strategizing about a whole sort of branch of work. So I think hiring departments or hiring people to take care of whole areas of responsibility, I would say is a little bit more effective for teams and saasbox that are doing things at a little bit of a higher level that I’m currently doing right now. I think if you want to stay in this bootstrapped, relatively small area of SaaS, I would advise any founder to get their hands dirty and learn do it all. That doesn’t mean that you will have to manually sit and do it all. You can delegate, but you should be in charge of everything. I would say that’s recommendable, but then again, I have seen other teams that do really well at the other thing. They actually form a team and they have a whole culture around people being super independently, rolling on each their own thing, even at a smaller scale.
[00:26:01.950] – Simon
So I’m not here to say that the way I do it is the only way. I’m just saying that’s the way that I know work really well and that I would, for financial and economic and scalability reasons, I would recommend to do it like that.
[00:26:13.100] – Joran
I think you have a really big sense of accountability. That’s why you also keep control. So it’s like your way of also making sure that you keep yourself accountable, that things are going to happen, and then you just delegate the things to actually make it happen. So the task and not the actual projects. And then one thing you mentioned, like your bootstrap, right? I think you’re now in a phase where maybe not in this market, but it should be relatively easier for you to get external funding. What is your reasoning to stay bootstrapped?
[00:26:40.170] – Simon
I think this comes down to which kind of business you prefer running. I went into this whole game of being an entrepreneur so that I wouldn’t have a boss. And if I went out right now and got funding, that’s exactly what I would be getting myself. And especially being a relatively small project. Still, I get messages from people all the time who wants to invest. So it’s like when you do well at the bootstrapping game, this is attract a lot of investors. No doubt that you’re going to be popular among venture capitalists who want to invest to see, don’t you want to take this to the next level? My answer is for these people often, and they get a little bit surprised when I say no, I actually don’t want to take it to the next level. I’m perfectly fine doing it here. If I’m going to ever get to 10 million ARR or even 100 million ARR, big numbers like that, I will do this very slowly and steadily. I’m probably never going to see 100 million ar in the way I do business. So unless I change my mind on this, which I probably won’t, that will just never happen.
[00:27:35.540] – Simon
I like to be completely in charge of everything I do. I like the autonomy that comes with that. I like not having to report to investors. I certainly like to not imagine giving an investor a board seat for a relatively low amount of money. I have seen small startups do that now not only do they have a boss again, they also have a boss they can’t fire. It’s hell. I personally wouldn’t do that at all. Again, not saying like there are different things that are right for different people. There are some people and some founders that say, I want to go big, like really big, they probably do need financial help, and that’s perfectly fine. But if you are anything like me, you want to run your own business, even if it is small, then you probably don’t want to take investors in.
[00:28:17.870] – Joran
Yeah, I think that’s a really nice summary and to look at things. And again, this is indeed a personal opinion, but I think a lot of bootstrappers can fully relate to this. So when we go to the final four questions, the famous four, when we talk about user acquisition, what kind of advice would you give somebody who’s starting out in growing a ten k? Mr. And I know we just went through these stages, but I guess feel free to summarize it a little bit in here as well.
[00:28:43.160] – Simon
So to get the first ten K MRR, focus on things that are at that level of where your business is currently at. So at this point, there’s going to be a certain level of grinding. You’re going to reach out by you reaching out to the first 510 25 or so users and bring them on board and understand that you are seeing a lot of advertisement all the time for all kinds of SaaS products. So these users, they don’t really owe you anything and they are insanely valuable for your SaaS product at this early stage. So you don’t need to listen to the people who say, don’t sell your SaaS too cheap. Don’t offer lifetime for free. I will say in this early stage, you’re absolutely not devaluing your product by getting the first 25 users on board and offering them a free account. What you are valuing appropriately is how much these early users are actually worth. Next is a long and hard content game. You want to really be active on social media, put yourself out there, make sure you write a decent amount of blog posts, put YouTube videos on YouTube. Make sure you show up on social media every day.
[00:29:54.290] – Simon
Even though there’s going to be long stretches where you struggle with engagement, it seems like no one’s interested. Just keep going. This phase is long and hard.
[00:30:02.460] – Joran
Yeah, I think it comes down together. Like you mentioned, grinding at the beginning and then playing the long term at the end. I think that’s definitely the phase you’re in. And I like what you’re saying. Respect the users. Like how much are they worth to you? So don’t turn things around. Like, you’re not devaluating your product if you give them away for free or even like at a high discount, you need them to actually build on and get to the next phase, basically, or next stages, as you call it, if we go beyond ten k. Mr. We’re now growing towards 10 million ar. It’s a big step. What kind of advice would you give.
[00:30:33.850] – Simon
SaaS founders here to summarize? I think generally speaking, when you’re going towards these bigger numbers, I think one advice that I would give is, as a founder, keep putting yourself out there. I have met founders who are going beyond $100,000 per month, and they start having this idea that now they can lean back as the CEO. They can just be at strategy level. They don’t have to be involved in the business anymore, and this is just not going to work. It might work when you get up to some really high numbers and your organization grows really big. But as a founder, keep putting yourself out there and it might be uncomfortable for you to go on YouTube and sit on a video like this or join a podcast episode like we’re doing right here. And it might feel like you’re crossing a boundary if you have to go up and do public speaking and standing in front of a bunch of people and talk. But don’t fool yourself into thinking that just because your SaaS products is starting to make money that you, as the founder don’t have to show up anymore. You absolutely do.
[00:31:31.760] – Simon
So that would be the best advice I can give at this stage.
[00:31:34.310] – Joran
Yeah. And does it also work, like internally and externally? Do you think if you put yourself out there, does it help the team morale as well?
[00:31:42.180] – Simon
I think it absolutely does. And you show your team that you’re not delegating responsibility to a point where you don’t think that this is your table anymore. You show them that you’re definitely fully involved in all the aspects of your business, even though we’re now at a higher scale.
[00:32:00.140] – Joran
Yeah. And I think it’s nice for employees as well to be part of a company which really is out there and really tries to help other people as well by jumping on podcasts, for sure. Being on stage when we zoom out, I guess, from user acquisition, do you have any more general advice towards SaaS founders who are now on their journey?
[00:32:18.320] – Simon
Not besides what I already emphasized, like use content. I still think that even in our day and age, everyone knows they need to be on social media. I still think that this is an underutilized area for a lot of SaaS companies. They’re simply just sleeping on this part. Show up on podcast, on YouTube, go on, like, write blog posts, make sure that you’re out there where people hang out.
[00:32:43.940] – Joran
Final question, what is one thing you wish you knew ten years ago?
[00:32:47.990] – Simon
That’s a good question. One thing I wish I knew ten years ago, if I could tell myself something my ten year younger self right now, I would probably say stick to some of the things that are obvious and tried and tested. Ten years ago, I was in my twenty? S and I was very busy chasing shiny objects all the time. And whenever something didn’t immediately pick up, like I saw people advertise it online or people gave me the impression that you can now do this thing and it’s just easy money. Overnight I would get demotivated and I would constantly try to chase something new. So that would be the best advice I can give. Find something that you like and that you enjoy and that you can see this could really become something that you’re good at and then just keep grinding. Understand that it will take a lot of time in the beginning and it’s going to be demotivating a lot of the times. But keep going. Give it at least two, three years before you start expecting to see actual tangible results.
[00:33:44.610] – Joran
Pick something you like because then it’s easier to stick in this period because otherwise at one point you will give up. If you’re not liking what you’re doing, then it’s going to be successful failure. Nice. If people want to get in contact with you, Simon, where and how should they do?
[00:33:58.700] – Simon
LinkedIn would be a good place to reach out now. Threats from meta just launched in Europe, so I’m active there now as well. Otherwise I’m pretty much to find everywhere and I try to be active in the comment sections on both YouTube and Instagram and LinkedIn and so on. So try to tag me in some of the public posts I do and most likely I will see you.
[00:34:20.120] – Joran
Nice. So you are in part of at least the new shiny object for meta at the moment. But yeah, I think absolutely nice. So I guess to conclude, I would definitely recommend looking at the content. Simon is pushing out like 100,000 subscribers on YouTube and a really specific niche B2B SaaS. Check out his LinkedIn content. He probably has a lot of blog articles you can learn from as well. He’s currently running three SaaS businesses, feed hive, link drip and eight base. And if you want to reach out to him, the best way to do so is on LinkedIn. And I can tell you he’s responsive. Feel free to do so. Thank you for coming onto the show, Simon, it was a pleasure. Thank you for watching this show of the grow your BDB sauce podcast. You made it till the end, so I think we can assume you like this content. If you did, give us a thumbs up. Subscribe to the channel. If you like this content. Feel free to reach out if you want to sponsor the show. If you have a specific guest in mind, if you have a specific topic you want us to cover, reach out to me on LinkedIn.
[00:35:18.330] – Joran
More than happy to take a look at it. If you want to know more about redditis, feel free to reach out as well. But for now, have a great day and good luck growing your B2B SaaS.