$10m ARR is the FU MONEY of SaaS

I think $10m ARR bootstrapped is the new unicorn.

Why?

Because if you can bootstrap $10m ARR in a lean way, all your wildest dreams will come true.

You will be able to do whatever you want with your life.

(I know because I’ve done it)

Not only that, I think bootstrapping $10m ARR is actually way easier than creating a unicorn.

And WAY less risky, with a FAR higher probability-weighted financial (and happiness) outcome.

Here’s 6 reasons why all founders should commit to bootstrapping $10m ARR:

1. You and your co-founder will be making over $1m/yr in salary and dividends.

This is simple math (another benefit of a small, efficient team). You and your co-founder can easily clear $1M each at $10M ARR, and probably more. With VC money, you have to be much, MUCH larger before you can take home that kind of money. It will be years later, if it ever happens.

2. You can sell your business in ONE SECOND for $30-$40m (or more)

I’m sure you’ve all seen the math. Dilute yourself down to 5% on a 15 year run to $1B, and if you didn’t pull out HUGE secondary checks, you actually come out behind. Not only that - there are only a handful of buyers at $1b. There are hundreds - maybe thousands - of EBITDA buyers at $30-$40m.

3. You can hire a CEO to run your company, work 1 hour per week, and clip the coupon

4. You can work 100 hours per week and run yourself into the ground (if that’s your thing)

5. You can go raise $50m and build a unicorn

Your product and GTM will be so tight that if you want to hit a home run at this point, you can absolutely do it. And as a profitable company, you will have leverage to get good terms from growth equity funds. Many will put the money straight in your pocket.

6. You can keep running it lean, get to $25m ARR with 25 people and pay yourself $10-$15m per year.

This is a possibility that literally no one talks about. And again, I think it’s actually much easier and higher probability than creating a VC-backed unicorn. Exit or not, if you get here, game over. You get a decent exit every year!

TAKEAWAY:

If you can bootstrap $10m ARR, the options available to you are SO GOOD.

The harsh reality is that most companies never get there.

Why?

Because you get traction and VCs show up at your door.

They gas you up with hopes and dreams about how your SaaS will be a decacorn.

They give you money that you don’t need, which you promptly turn around and spend.

All the while, it’s actually INTERFERING with the one thing that will make you great, capital or not.

Product-market fit.

If you can find PMF, bootstrapped, then use money from your customers to get to $10m…

…And with PMF, you can…

You can do anything you want with your life.

A friend and epic founder of Boomerang (the Gmail app) - Aye Moah - did it.

She’s came on Inbound-Led Outbound LIVE yesterday to share how.

Here’s the recording: