How To Bootstrap a SaaS Ecommerce Startup

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Transcript of How To Bootstrap a SaaS Ecommerce Startup

  • Bootstrapping a SaaS ecommerce startupPresentation by Charles Brun for the CCE

    @_charlesbrun

  • @_charlesbrun

    Personalized paper an online catalogs.

  • @mtl_ecommerce

    facebook.com/mtlecommerce

    meetup.com/mtlecommerce

    mtlecommerce.com

  • @_charlesbrun

  • Social Media Email Offline

    @_charlesbrun

    Now In Store enables ecommerce by driving traffic to online stores

  • SaaS = Software as a Service@_charlesbrun

  • Traditional software model

    Perpetual license upfront

    Annual maintenance fee

    Upgrades

    C

    @_charlesbrun

  • @_charlesbrun

  • Traditional SaaS required deep pockets to stay alive

    Almost all costs are incurred at the beginning.

    High cost because custom-built solutions and large clients

    Profits are far into the future

    @_charlesbrun

  • The consumerization of IT changed everything

    @_charlesbrun

    The propensity for users experiences with technology as consumers to impact their expectations regarding their

    technology experiences at work.

  • Business Apps that are built like consumer apps

    Single purpose apps (unbundling)

    No customization (one size fits all)

    SMB oriented

    A new wave of SaaS

    Lower setup cost

    Lower maintenance cost (single version)

    Easier to bootstrap!

  • 5 rules to bootstrap a SaaS ecommerce Startup

  • Keep costs as low as possible

    Team should be able to do everything

    Dont overbuild: eliminate waste by talking to your customers

    80-20 rule: 80% of your customers use 20% of a products features

    Rule #1: Stay LeanYOU MEAN TO TELL ME

    THAT I NEED TO TALK TO MY CUSTOMERS?

    @_charlesbrun

  • Rule #2: Iterate Fast

    Build MVP

    Ship frequently and learn fast (time = $$$)

    Measure your results to get to product-market fit

    @_charlesbrun

  • Rule #3: Assess value propYou need 2 million

    customers to build $100 Million business

    charging $5/month

    Put a price on it as early as possible!

    SaaS SMB is hard because you have a lower ARPU

    Make sure ARPU is above $20 / month

    Be weary if your revenue ceiling is $100 / month

    You need tremendous volume to become a rockstar

    @_charlesbrun

  • Rule #4: Focus on churn

    Churn Rate = The percentage of subscribers to a service that discontinue their subscription to that service in a given time period

    In SaaS, churn rate needs to be at 5% or lower (in SMB world)

    Churn is the single biggest determinant of a business' capital eciency and how quickly it can grow

    @_charlesbrun

  • 5% churn rate

    2.5% churn rate

    $76,505 MRR

    $139,045 MRR

    Comparing churn rates

    @_charlesbrun

  • Rule #5: CAC < 1/3 LTV

    You can only be profitable with scale

    Once you control churn and the unit economics make sense expand sales

    Make sure CAC < 1/3 LTV

    @_charlesbrun

  • @_charlesbrun

    A startup is not a rocket-ship, its a hot-air balloon

  • Bootstrapping a SaaS ecommerce startup

    Thanks!

    @_charlesbrun

    Presentation by Charles Brun for the CCE