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Go back to a fulltime job to finance the startup?

I am a solo founder and I am running a SaaS business (Data Analytics). We are a team of 3 (me and two programmers that I pay) and have been coding for almost 2 years now. We already managed to get first paying customers and I really believe in the prospect of the company but at the same time I have a lot of worries because my savings are declining.

Luckily we have our first paying customers and in a few months we already broke even, but this does not pay living expenses for me and the costs of growing the company. The main problem: it is a B2B business and the sales cycle is much longer than I had expected (4-10 months).

I am thinking to go back to a full time paid job and hire a sales guy to do my job so that I can keep financing the startup until we are on enough speed.

  • Congratulations on your first customers. Those are always the hardest.

    When it comes to B2B SaaS there are several sales models. High-touch, low-touch, and self-service.

    High touch sales are about webinars, sales demos, integration services, extended evaluation periods and so on. Enterprises demand this, there’s really no other way.
    Low touch sales is for those companies that need a little bit of hand-holding. These sales are easy to close with a couple of emails and phone calls. This works for small and medium sized companies who have limited funds and little bureaucracy.
    Self-service. People go to your website, try your product, and then buy it. No salespeople involved in the process at all. This is suitable for small businesses and for hobbyists.

    So you need pricing to match your sales model. It’s not cost-effective to spend 10 months trying to persuade somebody to sign up for a $100 a month SaaS subscription.

    When you do serious B2B sales then you’re dealing with a long sales cycle, but the upside is that you can charge them a ridiculous amount of money. After 10 months of agonizing indecision the business commits for 3 years at 25k a month. So if you have several real customers your business should be making enough money to pay yourself and two programmers. At least enough to not even consider going back to your day job.

    So it doesn’t quite add up. Are you perhaps charging absurdly little for your software? Asking for 5k a month is insanity after 10 months of indecision. So what’s going on here?

    If you only need bridge money for a couple of months, try borrowing from friends and family. Or take out a second mortgage. Sell stuff you don’t need. Cut your personal expenses to 0. Take angel money, or join an accelerator. Startups get tough sometimes, but the moment you’re no longer 100% involved everything will go to shit.

    Reply

    • We are trying to move to Low touch Sales – as we can automate it much better – and only need to offer support.

      We still need to code the credit card integration, which we delayed because of other features and polishing. However, I think we will now do it in the next 2 months. Btw – product is priced at 299$ starter and 750 enterprise edition. We are in very niche and there is only limited competition.

      Reply

  • I feel you, I am also a solo founder running a B2B startup. We have our first customers but I had no idea how long the sales cycle is. I definitely have asked myself the same question, should I just get a job while I continue to build this? Because I am living so lean (credit cards maxed, just had to borrow $300 from my parents for groceries) and the company doesn’t make enough to pay me yet. It’s basically horrible even though I’m proud of what we’ve achieved and I think we’re going to make it.

    I would say it’s ALMOST a reasonable idea to get a full time job, except the part where you are going to hire someone else to do sales. No one else can sell the way you can as the founder, and trying to hire someone to basically be you sounds like a terrible recipe for disaster to me. They just aren’t going to do as good a job as you, because they don’t have the same incentive, and your sales will suffer.

    Can you freelance or work part time?

    I wonder if what you’re really saying here is that while you believe in the product you can’t live this way anymore, and you’re looking for a way out. When you have a company you can’t just quit, as much as you might want to sometimes, so maybe you’re looking for the next best thing. “I’ll hire someone else to do my job and then I’ll do something else.”

    If what you want is a steady job and steady paycheck that’s totally ok, no judgment! but don’t kid yourself by thinking you can have the startup and a full time job at the same time. I say, if you want out, get out. Sell the business or close it up and move on. If you don’t want out, sadly you have to double down I think.

    Strength to you, I know it enterprise sales sucks and is hard and worrying about money and your future sucks and is hard. GOOD LUCK.

    Reply

    • Yes I am freelancing at the moment. However, it pains me that my hourly rate is nothing to what it would be at a fulltime job. I tried to get high paid consulting jobs but they only are in the area of SAP, Server Setups …. which i don’t cover and also my CV does not say that I do (even if I could do it).

      I am trying to get Angel money at the same time but I feel like we need a bit more time to get things off the ground.

      Reply

  • I also understand where you are coming from. I am going thru it right at the moment but am building an app.

    Tell me more about what you are doing as I may be able to help:

    1. What kind of business is it? What actual service do you offer?

    The service you offer may not match your capabilities. You may need to cull one of the programmers or higher cheaper ones offshore. If you cut 1 programmer then you can add a sales guy.

    2. Where are you based? Tell me more so we can offer you a better solution.

    I am being serious here. Please reply. I am based in Sydney, Australia.

    Cheers

    Reply
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