Startups For the Rest of Us
Episode 688 | Growing Boot.dev From $6k to $110k in Monthly Revenue in 15 Months
Lane Wagner shares his journey of bootstrapping Boot.dev, a coding learning platform that has experienced significant growth. The podcast explores the challenges and successes of starting a B2C business, teaching backend development, raising funds, and implementing key actions for growth. It also discusses revenue metrics and financial considerations for Boot.dev.
Boot.dev's Unique Approach
Boot.dev stands out in the training industry with its interactive and gamified platform for learning Python and Go programming languages. It caters to the demand for backend development training and differentiates itself from traditional SaaS companies.
Raising Funds and Financial Security
Despite being profitable, Boot.dev raised funds for financial security. However, in hindsight, raising money was unnecessary as the company has been successful and has more funds now than before.
Key Actions for Growth
Hiring a marketer, rebranding the site, and implementing gamification were three impactful actions that contributed to Boot.dev's growth. These strategies helped the company stand out, attract attention, and enhance user engagement.
Revenue Metrics and Cash Flow Monitoring
Boot.dev's revenue metrics differ from traditional SaaS companies. Churn rate is higher, and word-of-mouth referrals play a significant role. Monitoring cash flow is crucial, especially with recent fast growth.
- Lane Wagner's Journey with Boot.dev
- Starting a B2C Business and Teaching Backend Development
- Challenges and Growth of Boot.dev
- Raising Funds and Overcoming Challenges
- Key Actions and Revenue Metrics of Boot.dev
- Financial Considerations and Cash Flow Monitoring
Lane Wagner's Journey with Boot.dev
00:00 - 06:35
- Lane Wagner of Boot.dev has mostly bootstrapped his coding learning platform.
- The platform has experienced significant growth, with net revenue reaching $110,000 in October 2023.
- The conversation delves into the factors that contributed to the sudden acceleration of growth for Boot.dev.
- Partnerships and getting in front of other audiences have been instrumental in driving growth for Boot.dev.
- YouTube has been a primary growth channel for Boot.dev through collaborations with other YouTubers.
- Boot.dev offers courses on Python and Go programming languages for individuals looking to learn or improve their skills.
- Despite challenges typically associated with B2C businesses, such as high churn rates, Boot.dev has achieved success with its revenue reaching $100k+ per month.
Starting a B2C Business and Teaching Backend Development
06:07 - 12:04
- The speaker advises against starting a B2C business due to high churn rates, but acknowledges that there are exceptions.
- Boot.dev is technically a subscription-based tool for learning, but the speaker doesn't consider it a traditional SaaS company.
- The interactive and gamified nature of Boot.dev sets it apart from other content-based platforms in the training industry.
- Boot.dev offers fully interactive software for learning Python and Go, which is unique in the programming space.
- There is a lack of online learning platforms catering to backend development compared to frontend development.
- Teaching has always been an interest for the speaker, who initially gained traction through technical blogging before transitioning into teaching through courses.
Challenges and Growth of Boot.dev
11:34 - 17:37
- The speaker has always enjoyed teaching and was a tutor in college.
- They have a background in backend development and were frustrated by the lack of training available for backend developers.
- Before quitting their job, the speaker experienced little growth with their company but made some key changes such as rebranding and niching down which led to increased traction.
- Despite being able to bootstrap the company, the speaker decided to raise funding to provide financial security for their growing family.
- In hindsight, raising money was unnecessary as the company has been profitable and has more money in the bank now than when they raised funds.
Raising Funds and Overcoming Challenges
17:09 - 23:10
- The speaker initially raised money for their business, even though they were already profitable and had enough funds.
- They projected a goal of making $30,000 in a month by November 2023, but ended up surpassing that with $110,000.
- Investors typically expect a return on their investment through an exit or dividends.
- The speaker is considering how to pay back investors and what the future holds for them.
- They only pitched one investor whom they knew from before and do not plan to raise more funds.
- The speaker discussed the possibility of selling the company or distributing profits instead of having an exit.
- Employee compensation was adjusted to include options and profit sharing plans due to uncertainty about selling the company.
- In 2021, the speaker experienced a difficult period where they considered giving up on the business due to lack of growth and mental strain.
- Eventually, they bought back their section of the business and tried different strategies that led to growth in early 2022.
- Three things were done differently during this period, but it's unclear which one had the most impact: working with a non-engineer marketer, adjusting marketing strategies, and reflecting on past experiences.
Key Actions and Revenue Metrics of Boot.dev
22:51 - 29:17
- The speaker reflects on three impactful actions taken in rapid succession: hiring a marketer, rebranding the site, and implementing gamification.
- Hiring a marketer or contractor is important for effective marketing to an audience with specific needs and preferences.
- Rebranding the site based on the principles outlined in Seth Godin's book "Purple Cow" helped the company stand out in a crowded market.
- Focusing on the back-end side of programming, particularly using Go as the primary language, differentiated the company and attracted attention within Go communities.
- Gamification has been embraced by boot.dev, incorporating elements like achievements, XP, and leaderboards to enhance user engagement and learning experience.
- The speaker emphasizes that boot.dev is not a SaaS business model but rather a training platform with different revenue metrics.
- Churn rate is higher than traditional SaaS companies due to customers dropping out for various reasons.
- Word-of-mouth referrals are more prevalent in the e-learning industry compared to B2B SaaS tooling.
Financial Considerations and Cash Flow Monitoring
28:59 - 31:56
- Selling annual plans allows for upfront cash, but the monthly recurring revenue (MRR) may seem low.
- When selling an annual plan, it is important to divide the total amount by 12 to recognize the MRR over the next 12 months.
- The company thinks of their product as being financed over a certain period of time, with average customer lifetime value ranging from $100 to $300.
- The actual cash coming in every month is lower than the MRR due to recent fast growth, currently around $30k compared to an MRR of $50k.
- Monitoring the cash coming in each month is crucial, even without new marketing efforts.