For example, he recommends A) going after a big B2B market with lots of existing demand (good)
Then he recommends B) spend on advertising instead of content marketing (not so good)
You can't both do A and B. Big markets with lots of demand also have tons of competition in the advertising space.
The talk he's referencing for these tips is from almost a decade ago (Jason Cohen's microconf talk). I'm sure Google adwords was a much more viable strategy back then, however, if you're remotely close to a big market in B2B, adwords is now going to be cost-prohibitive for growing a bootstrapped business.
The reason Jason's personal blog didn't convert well is because his content wasn't targeted towards the products he was creating. If you're writing about general life/tech news/etc. the chances your audience will overlap with a niche B2B product offering are slim to none.
On the contrary, most of the B2B Saas startups I've worked with in the last 5 years grow almost entirely from SEO.
Content is like real estate. Once you start ranking for a few key niche search phrases, your position grows in value over time, without you doing anything.
Advertising on the other hand is like a money treadmill. The minute you step off the treadmill, you're no longer getting leads...at all.
If you want to bootstrap a sustainable business, ignore content/SEO at your own peril.
This is the problem with these twitter-thread microblog posts. There's never enough space to really explain or discuss something. It seems to me that Twitter microblogging a complex, multipart idea is a quick way of getting half-baked thoughts out that provides an excuse for not being more verbose. Sometimes being less verbose is good. Sometimes brevity isn't the answer.
Yes, B2B subscription / SaaS has a lot going for it. Lower price sensitivity, potential for negative churn, etc.
But dismissing B2C subscriptions is pretty terrible advice. Things have changed over the past few years and there's potential to build both healthy "side hustle" B2C subscription businesses as well as large venture-scale ones.
I work on a venture-backed B2C subscription startup, and despite what investors told us when we started building, we're seeing pretty healthy willingness-to-pay right now.
I’ve long suspected consumer willingness to pay _for things they value_
E.g. people pay heaps for entertainment (Spotify, Disney+ etc)
It’s about finding the line between whether the individual service is worth x% of their pay check or not
I don’t know how we ended up in this twisted “everything’s free on the internet” model based on surveillance ads but I hope it ends. I’d rather pay a reasonable amount for value.
The only question is how general browsing would be paid for.. maybe ads will always be there for some sites. Maybe we could do micro payments in the browser.. I don’t know.
The issue with B2C, If it's an app based product(not associated with any physical service) then immediately we're competing with the likes of Facebook, TikTok, YouTube etc. for screen time no matter what problem the app solves.
With B2B again we might end-up serving those who are building B2C products and they would face the aforementioned problem. So if our customers couldn't succeed can we? Yet the room operate in B2B is larger than what B2C currently is.
Unless the size of behemoths is controlled, fair competition is ensured thoroughly even B2B might not be a safer bet in the future.
> Examples of bad markets ... Marketplaces - suddenly you have 2 businesses instead of 1
It'd be far more accurate to say that marketplaces are very difficult products/services to build out, not bad markets. And you plainly don't have two businesses, the two sides of the marketplace are not separate businesses at all, they're two required aspects to that one business. That's not uncommon in business. If you open a convenience store you don't just need inventory, or a building/location, or employees, or customers, or a POS system, you need all of those things, that doesn't mean it's multiple businesses.
There are few better businesses than marketplaces once you get one established. They're monsters then. You have to nearly intentionally screw them up to lose the captured market. Just ask eBay, across its existence it has just about done every variety of thing wrong you can (not at the same time), and its monopoly remains 20+ years later, printing fat margins the entire time. Nobody can unseat it. There it is, $2b-$3b in operating income year after year. Amazon tried to take them down and failed spectacularly. What eBay does isn't complex per se, it's that they successfully built a marketplace, and that tends to come with a huge moat. Etsy will likely enjoy a similar moat, assuming they don't do anything drastic to mess it up.
I read his comment as meaning WRT the work required to market to and acquire the two distinct customer constituents (buyers and sellers).
It's not two full businesses, but I think he has a point in that context. Actually, it's even harder than that: there's the whole chicken-and-egg thing that adds an additional timing factor to the customer acquisition effort.
For B2B, after years of software subscriptions with sudden 10x or 100x price increases, there is a bit of fatigue and companies are a bit more wary than they were 5-10 years ago. The expectation of price increases are now baked into the cost forecasts. Getting approval for $250/mo is actually a harder sell in many companies than getting a one-time approval for $25,000.
>there is a bit of fatigue and companies are a bit more wary than they were 5-10 years ago
This reminded me of a really disheartening (and probably 100% accurate) thread on Reddit recently. A developer was asking how to go about validating an idea for a SaaS that was catered towards small businesses. Most, if not all of the comments were along the lines of "no thanks, we've already dealt with a startup trying to 'solve' our problem."
This is an interesting point! It raises the question of what kinds of software products could a bootstrapper create and sell with a, say, $5K+ one-off cost? (genuine interest, not sarcasm)
It’s interesting that he mentions ads is better than content marketing. Given that ads is a form of push marketing that usually attracts much lower quality leads than content marketing.
A good starting point is to fix something that sucks in your current job. Like a missing feature of a platform you use. It’s no guarantee of success, but maybe a good place to begin.
I think you can still get alway with a better execution of existing products. The market is very big it seems. Just observe how many SaaS CRMs are making big money.
You don't know until you know. I've seen a lot of non-sense apps HN folks bash to death like "this is just a couple command lines to get it done", yet those apps' MRR (as I've monitored) keep raising slowly.
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For example, he recommends A) going after a big B2B market with lots of existing demand (good)
Then he recommends B) spend on advertising instead of content marketing (not so good)
You can't both do A and B. Big markets with lots of demand also have tons of competition in the advertising space.
The talk he's referencing for these tips is from almost a decade ago (Jason Cohen's microconf talk). I'm sure Google adwords was a much more viable strategy back then, however, if you're remotely close to a big market in B2B, adwords is now going to be cost-prohibitive for growing a bootstrapped business.
The reason Jason's personal blog didn't convert well is because his content wasn't targeted towards the products he was creating. If you're writing about general life/tech news/etc. the chances your audience will overlap with a niche B2B product offering are slim to none.
On the contrary, most of the B2B Saas startups I've worked with in the last 5 years grow almost entirely from SEO.
Content is like real estate. Once you start ranking for a few key niche search phrases, your position grows in value over time, without you doing anything.
Advertising on the other hand is like a money treadmill. The minute you step off the treadmill, you're no longer getting leads...at all.
If you want to bootstrap a sustainable business, ignore content/SEO at your own peril.
I highly disagree.
Yes, B2B subscription / SaaS has a lot going for it. Lower price sensitivity, potential for negative churn, etc.
But dismissing B2C subscriptions is pretty terrible advice. Things have changed over the past few years and there's potential to build both healthy "side hustle" B2C subscription businesses as well as large venture-scale ones.
I work on a venture-backed B2C subscription startup, and despite what investors told us when we started building, we're seeing pretty healthy willingness-to-pay right now.
E.g. people pay heaps for entertainment (Spotify, Disney+ etc)
It’s about finding the line between whether the individual service is worth x% of their pay check or not
I don’t know how we ended up in this twisted “everything’s free on the internet” model based on surveillance ads but I hope it ends. I’d rather pay a reasonable amount for value.
The only question is how general browsing would be paid for.. maybe ads will always be there for some sites. Maybe we could do micro payments in the browser.. I don’t know.
Dead Comment
With B2B again we might end-up serving those who are building B2C products and they would face the aforementioned problem. So if our customers couldn't succeed can we? Yet the room operate in B2B is larger than what B2C currently is.
Unless the size of behemoths is controlled, fair competition is ensured thoroughly even B2B might not be a safer bet in the future.
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It'd be far more accurate to say that marketplaces are very difficult products/services to build out, not bad markets. And you plainly don't have two businesses, the two sides of the marketplace are not separate businesses at all, they're two required aspects to that one business. That's not uncommon in business. If you open a convenience store you don't just need inventory, or a building/location, or employees, or customers, or a POS system, you need all of those things, that doesn't mean it's multiple businesses.
There are few better businesses than marketplaces once you get one established. They're monsters then. You have to nearly intentionally screw them up to lose the captured market. Just ask eBay, across its existence it has just about done every variety of thing wrong you can (not at the same time), and its monopoly remains 20+ years later, printing fat margins the entire time. Nobody can unseat it. There it is, $2b-$3b in operating income year after year. Amazon tried to take them down and failed spectacularly. What eBay does isn't complex per se, it's that they successfully built a marketplace, and that tends to come with a huge moat. Etsy will likely enjoy a similar moat, assuming they don't do anything drastic to mess it up.
I read his comment as meaning WRT the work required to market to and acquire the two distinct customer constituents (buyers and sellers).
It's not two full businesses, but I think he has a point in that context. Actually, it's even harder than that: there's the whole chicken-and-egg thing that adds an additional timing factor to the customer acquisition effort.
This reminded me of a really disheartening (and probably 100% accurate) thread on Reddit recently. A developer was asking how to go about validating an idea for a SaaS that was catered towards small businesses. Most, if not all of the comments were along the lines of "no thanks, we've already dealt with a startup trying to 'solve' our problem."
This.
I actually see a much greater multiple where customers still prefer to make a CapEx vs OpEx. The low cost of capital is a likely contributor.
I find myself using archive.is to read most text-heavy webpages these days.
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