Startups For the Rest of Us

Brian & Scottie Elliott are the husband & wife co-founders of Gather, an interior design project management app. Join Rob as he chats with Brian & Scottie for the final episode of Season 2 of TinySeed Tales. In the last year, Gather managed to double their revenue and overcome most of the challenges they faced along the way. It's been about a month since we last spoke and during that time, their recent cash crunch has started to resolve itself. In this episode, we reflect on the past year and their success (and struggle) with moving upmarket.

The topics we cover

[01:01] Gather's recent cash crunch

• Cashflow is not our biggest concern anymore, which is a great relief.
• Since that time growth has been either sorta normal steady when you average it out or maybe a little slower the last month and a half.
• Small Business Association loan and PPP loan changed things for us,.
• One was the loans, the other was that Gather landed a bigger enterprise client who was willing to fund features and who was willing to put cash upfront for you to build them.
• That allowed us to ramp our developer up from the part-time back to full-time, which was great.

[06:46] Looking forward a year from now

• I think we're just going to have a much more well-rounded product.
• I could easily see us doubling again, this coming year.
• I feel like we've just been learning a lot about where we're lacking, what could be better, and what would be. More valuable or what to add.

[07:55] Did going upmarket save the business?

• No doubt. Previous, smaller clients are very cost-sensitive.
• With our larger firms, pricing doesn't seem to ever really come up. It's mostly about features.
• We're not adding a ton of customers per month, but each one that we add they're worth more and we're just not turning out the smaller folks.
• It was such a big gamble right at the start.
• When you go upmarket, you can charge more and churn is going to tend to be lower Sales cycles will be longer, but people stick around longer. There's more loyalty.
• We're excited about where those next five years are going to go because we think we're sort of just, even at the beginning of this journey, even though we're a bit into it already.

[14:56] Advice for early-stage SaaS founders

• Relax into it. It doesn't mean that you can be complacent and that you can't pay attention, but just realize like you're on this path, you're on this journey and it's going to take however long it's going to take. It may not be the product that you're working on right now. Maybe the next one, it may be five products down the line, but whatever it is, it's just a matter of staying with it and being okay with the waves and roadblocks that come up around you and just go around them as gracefully as you can. Keep at it because the process is, for me, anyway, as much as the outcome.

Links from the show

• Gather | Website
• Brian Elliott | Twitter

Thanks for listening to another episode of TinySeed Tales. If you haven't already, be sure to check out Season 1 of TinySeed Tales where we follow the Saas journey with Craig Hewitt of Castos.

Rob welcomes back to the show a frequent guest, Craig Hewitt for a "Where Are They Now?" syle episode. Craig is the founder of Castos and has appeared many times on Startups For the Rest of Us. In this episode, they reconnect and talk about the latest with Castos, from hiring a growth marketer, merging brands, private podcasting, and so much more.

The topics we cover

[3:54] Reflections on hiring a growth marketer 1 year later

[6:92] How did the free trial without asking for a credit card experiment work out?

[8:92] Merging brands and moving into enterprise offers

[19:91] Private podcasting

[23:44] What's new and exciting at Castos

Links from the show

• Episode 466 | Answering Listener Questions With Craig Hewitt
• Episode 493 | A Roundtable Discussion about COVID-19, Working From Home, Payroll Protection and More
• TinySeed Tales - Season 1
• Castos Productions (formerly Podcast Motor)
• Rogue Startups
• The SaaS Podcast Award

If you enjoyed this episode, let us know by clicking the link and sharing what you learned.

Click here to share your number one takeaway from the episode.

If you have questions about starting or scaling a software business that you'd like for us to cover, please submit your question for an upcoming episode. We'd love to hear from you!

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In Episode 546, Rob Walling flies solo for a Q&A episode. With a backlog of great listener questions, Rob discusses qualified small business stock (QSBS), hiring entrepreneurially-minded employees, indie hacking while working at a large company, and more.

The topics we cover

[01:51] Should I switch to a C Corp to take advantage of QSBS in five years?

[05:40] How to attract entrepreneurial employees

[14:19] Indie-hacking while working at a large Fortune 20 company

[19:12] Finding a niche using the Disruptive Innovation

Links from the show

• Episode 442 | Corporate Structures and How the Choice You Make Now Can Impact You Years Down the Line
• Episode 519 | Profit Sharing, Stock Options, and Equity (A Rob Solo Adventure)
• The Stair Step Approach to Bootstrapping | Rob Walling - Serial Entrepreneur
• Qualified Small Business Stock (QSBS)

If you enjoyed this episode, let us know by clicking the link and sharing what you learned.

Click here to share your number one takeaway from the episode.

If you have questions about starting or scaling a software business that you’d like for us to cover, please submit your question for an upcoming episode. We’d love to hear from you!

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Brian & Scottie Elliott are the husband & wife co-founders of Gather, an interior design project management app. Today we're going to dive into the stress that comes with entrepreneurship and how it shows up in their personal lives. Moving up from one customer segment to another is hard. Each customer segment is like an Island with a body of water between them. They're crossing that body of water from servicing one and two-person teams to serving larger architecture firms with 20 person teams. We hear how they are managing this difficult and stressful moment both as co-founders and as married partners.

The topics we cover

[01:40] Leveraging testimonials when moving upmarket

• It's an approach you should explore as early as possible when trying to move into a new segment of the market
• One of the reasons why trials are kind of a little bit lower this month is because some of the traffic that we've been getting is probably more geared towards the residential side and they're seeing this new messaging.
• You have two islands and a body of water in between them and its messaging and sales process and pricing and positioning and all that around going after one person, two-person teams versus a 10 person team and those are the two different islands.

[06:09] Cold email experiments to attract larger teams

• Averaging 12-15 demos per week (initial goal was to get to 10)
• Finding one repeatable channel at this stage is huge
• Cold email has been the channel that has worked the best for Brian & Scottie
• Most businesses that start B2C end up transitioning to B2B and end up raising prices. Means less churn, fewer flakes for demos, better conversion.'
• Demo to trial isn't as high as they'd like it to be.
• One reason for this could be due to the longer sales process

[11:27] Cashflow management

• We had a really good month last month -- the best month we've ever had.
• The biggest stress is just around the channels that we're investing in and wondering if they are going to perform like we want them to.
• These are challenges with going upmarket. First, you have to figure out if you have product-market fit with teams. Then you have to find a channel or two that work. If the channel works, do the people stick around and can you find enough people who sign up and stick around? Can you find them fast enough with the channels you have such that you don't run out of cash
• At the current burn rate we have about 6 months cash in the bank
• If pushed, would consider debt-equity or debt financing as a fallback option
• Founders do all sorts of things to maintain their runway, including credit card debt, personal loans, raising funding, even borrowing from their 401k. But with each of these, you have to weigh the risks to the business, as well as your personal financial situation.

[18:09] Dealing with stress as entrepreneurs and a married couple

• The situation causes us to feel a little bit on edge and we have no one else to take it out on.
• Now we're being much more conscious of our personal spending ad so I think that has also manifested itself just a little bit in some additional stress because we're really tracking all of our expenses really tightly and we're making sure that we don't spend foolishly.
• No silver bullet for stress, but certainly meditation, exercise, and being aware that you are stressed.
• Even though there is this sort of stress and there's sort of some existential risks to this experiment that we're running, it also feels aligned with where we want to go as a family and as an exit plan from work life at some point.

Links from the show

• Default Alive
• Equity Financing vs. Debt Financing: What's the difference?
• Gather | Website
• Brian Elliott | Twitter

Thanks for listening to another episode of TinySeed Tales. If you haven't already, be sure to check out Season 1 of TinySeed Tales where we follow the Saas journey with Craig Hewitt of Castos.

In episode 523, Rob hosts a rapid-fire lightning round of listener questions ranging from whether to focus on one or multiple businesses, finding the right amount of customer research, breaking through slow growth, and teaching entrepreneurship to kids.

The topics we cover

[4:38] If you were starting a business today and you were earlier on in your career, would you try multiple business ideas at once or go all-in on one?

[8:11] If building your first tiny product, like a WordPress plugin, what level of customer research should you do?

[10:56] What advice would you give to someone entering a somewhat competitive market?

[15:55] What questions would you be asking yourself if you had a slow-growing 12k MRR B2B SaaS?

[18:22] How would you go about offloading tier-one customer support?

[20:28] How do you feel about entrepreneurship being taught to children?

[22:24] What are things you noticed that bootstrappers commonly overlooked that are preventing them from achieving their goals?

[23:18] What are some of the biggest takeaways you can see across your portfolio of early-stage SaaS companies?

[25:01] Have you ever built a business that got a fairly large portion of its revenue from services instead of products, but not just you consulting?

[26:56] How do you prepare financially or otherwise for your retirement?

Links from the show

• MicroConf Connect
• SavvyCal
• Stay on Top of Your SaaS Metrics: Know What to Measure to Maintain Sustainable Growth – Craig Hewitt
• The 2020 State of Independent SaaS
• ZenFounder
• Indie Founder Bootcamp
• AudienceOps
• Castos Production (formerly Podcast Motor)

If you enjoyed this episode, let us know by clicking the link and sharing what you learned.

Click here to share your number one takeaway from the episode.

If you have questions about starting or scaling a software business that you'd like for us to cover, please submit your question for an upcoming episode. We'd love to hear from you!