Are you VC-funded? No, we're profitable(twitter.com) |
Are you VC-funded? No, we're profitable(twitter.com) |
To be fair, this was one customer's question, not necessarily a trend.
The merits of taking VC are debatable. But I don't think we're at a point where potential customers broadly are skeptical of a funded startup. If nothing else, it means someone, somewhere has vetted you and thinks you can deliver.
There's people that simply enjoy their company and working in it, they only luck to sell when they are old and there are no great heirs to the business.
And that's true for billion dollar companies too.
VC-funded = Full Salary early, network for future jobs if company fails, shortcuts like joining an incubator and selling to your cohort for early sales figures (which can then be used to get more money)
Being profitable means you’re not beholden to new investors. If your goal is to run a company rather than race for an exit, this lets you make much longer term strategic decisions.
How does that help me as a potential user?
But now you can create some AI generated slop in a day that used to take months. Being an indie hacker used to be a sort of badge of honour, now it's where everyone starts.
I think the VC-backed companies who have budgets to do actual marketing, actual sales, actual outreach beyond "I have a good following on X, I'm gonna sell them stuff" will win in the end.
As a customer, for me I don't care whether the company is profitable, I care about whether it works, whether it's in my budget, whether the company will be around in 2 years regardless of if the founder loses their passion for it.
Bootstrapped startups go out of business.
While there is a large gap in the two models in terms of finances, operations and everything else, trying to argue that customers should pick your company purely because you haven't raised money shows that you are either deliberately being insincere or know nothing about the industry, neither of which are great selling points.
If you want to compete, do it on the basis of features and value.
Bootstrapped startups go out of business because they are not profitable.
As a customer, knowing that a vendor is already profitable and sustainable is a big green light.
Most of them struggled for a while and then pivoted into some variation of being an influencer: Selling courses, selling services to other indie hackers, or just Tweeting trend-following engagement bait 50 times a day and then bragging about the size of their X payout checks.
Everyone talks about the levels.io guy as the epitome of indie hacking, but many don’t realize (or don’t want to admit) that his projects are making that amount of money because of his Twitter following. His current project is a simple vibe-coded game that sells in-game advertising, and the advertisers are paying largely for the novelty and to get in on the conversation. Nothing about that revenue model could be replicated by anyone with such a large Twitter following. Fantastic for him, of course, but it’s so far removed from what people imagine when they talk about being an indie hacker that it’s just not a relevant example of the space. Yet he continues to be held up as an example of what indie hackers can attain.
I think there’s space for individual entrepreneurs, app creators, and business operators. I just don’t see it coming from the self-described “indie hacker” space at this point because indie hacking has turned into a marketing and self-promotion meta game. The real independent devs are operating out of sight at this point.
I had a modest following on Indie Hackers, and my posts always did well. But after 2021 none of my posts ever could cut through the “7 tweets you need to make right now to generate signups”. I just stopped posting and that’s when I came over to Hacker News.
I hope something pops up like Indie Hackers again, because there are a few of us who build small products and don’t want to be Twitter influencers.
Hiring more people seems necessary to stay sane -- at least for my project. But you need money for that, which you won't have for a long time. Even tools for all these aspects (Claude, Revid.ai, ahrefs, etc) stack up in subscription costs.
Maybe this is just because I'm getting started, though.
Regarding the topic at hand, I'm more likely to purchase something that's not VC-backed, and does not mention AI at all these days.
Yeah, but it won't work. Not a very good look if you're trying to grow your business.
VC/private equity requires growth levels that are unsustainable and the focus on that destroys the long term prospects of a lot of companies that otherwise would provide great value and support themselves.
So the ones that game marketing for revenue (badly developed or designed features, overselling, etc) win over those that provide real value.
1. Re: hiring, you're probably not going to hire your first FTE right after raising money. You're probably going to do so after getting a bit of traction. I hear most investors especially today will push you to be lean and do more yourself. Either way, bootstrap or VC funding, you're going to bust ass, no way around it.
2. Re: salary, yes, some investors will encourage you to pay yourself, but you're probably not paying yourself a "full" salary right away.
3. Re: selling to cohorts is a bit overrated I think. The fact of the matter is, they're probably all early-stage tech startups, which means if you don't have a product that specifically targets early-stage tech startups, you're probably not going to sell to them.
I don't think it's as cut and dried as X is better than Y. It really is all about how much risk you want to take on, if VC funding is even an option.
This is also a thing you get when bootstrapping, if you're bootstrapping correctly.
Once it's a full fledged business with a steady income stream, an above average salary would then be warranted.
- App A: AI Virtual Try-On. Lets customers try products virtually, reducing returns.
- App B: WhatsApp Chat Button. Seamless WhatsApp integration for instant support.
- App C: AI Product Blocks. AI-generated insights to boost trust and conversions.
App B doesn't have AI, but Apps A and C are products that have existed in various forms on the Shopify App Store for years before AI became a buzzword. AI doesn't add anything here – especially in the case of Product Blocks, if you're familiar with what a block is in a Shopify theme, or the privacy restrictions enforced on them. And AI virtual try-on? What is AI going to add to a virtual try-on?
I can imagine words of praise, rendered in an emotionally convincing tone of voice would be good for conversion.