Posted on Tuesday, Apr 2nd 2019
According to Industry Reports, Global Project Management Software Market is expected to grow from $2.3 billion in 2007 to $7 billion by 2026 at a CAGR of 14.93%. Basecamp is a mostly bootstrapped business that provides cloud-based project management and collaboration systems to small businesses.
Chicago-based Basecamp was started in 1999 by Jason Fried, Carlos Segura, David Heinemeier Hansson, and Ernest Kim as a web design company called 37signals. It launched its flagship project management application Basecamp in 2004. David used the then-obscure Ruby programming language to develop a custom web framework for internal use at 37signals. He released the framework as the open source project Ruby on Rails in 2004. Today, Rails is one of the most popular programming frameworks that is used by sites like Twitter, GitHub, and Shopify.
By 2005, the company pivoted to focus exclusively on web applications. The company went on to release commercial applications like Backpack, Campfire, and Highrise. In 2014, the company decided to focus exclusively on Basecamp and renamed the company as Basecamp.
Basecamp offers project management and collaboration features such as Schedule for setting important dates on a shared schedule; To-Do Lists; File Storage for sharing documents, files, images, and spreadsheets; Message Board for posting announcements, pitching ideas, and progress updates; and a chat room called Campfire for informal interaction with the team. Its Automatic Check-in feature enables you to create recurring questions and replaces status meetings.
Basecamp is priced at $99 per month for unlimited users and projects. It is free for teachers and students and is discounted for non-profits. It offers a 30-day free trial. It currently has over 100,000 paying customers and over 3 million accounts signed up. It competes with Slack, Asana, Dropbox, Google’s Gsuite
Basecamp is privately held and doesn’t disclose details of its financials. It has been profitable from the very beginning of its journey. It is estimated to have annual revenue of $25 million. The company prefers slow, consistent, and profitable growth of at least 5%. It has a lean team of over 50 remote employees spread out across 32 cities around the world.
In 2006, Jeff Bezos bought a minority, no-control stake from Jason and David for a few million dollars. Bezos’ personal investment firm Bezos Expeditions simply took the role of a member in the LLC and a share in the profits. They took the funding merely to hedge their bets and ensured that the investor had minimum control. They were modestly profitable at that time and had no interest in giving up whatever little success they had. But since it was possible that Basecamp could peter out, they didn’t want to end up with nothing to show for their success. So, they decided to go for no-control deal with Jeff who still owns that stake.
Since then, Basecamp has not taken any funding. It has apparently turned down over 100 investment offers from venture capitalists and private equity firms.
Basecamp’s secret recipe for success is that they don’t spend more than they earn, don’t waste money on things that don’t matter, don’t give away everything for free and hope to figure it out before running out of cash. That’s a logical and useful tip for any startup.
Photo by Alvaro Reyes on Unsplash
This segment is a part in the series : Best of Bootstrapping
. Bootstrapping to an Exit . Why is Bootstrapping Important? . How Can You Play this Low-Probability Game Intelligently? . Do NOT Go to VCs as Beggars - Go as Kings . Excess is NOT Required for Success . Bootstrap First and Raise Money Later . Some Bootstrapping to Exit Case Studies . The Buy Side of Bootstrapping to an Exit . Blitzscaling vs. Bootstrapping . Bootstrapping to UnicornsMore »» . Cinedigm Acquires Bootstrapped 1Mby1M Company Future Today for $60 Million . Mailchimp Bootstraps to $600M Revenue . Bootstrapping from Arizona to $10 Million . Bootstrapped Basecamp Executes a No Nonsense Strategy . How Under30Experiences Bootstrapped to $5 Million . Bootstrapping with a Paycheck . How Algo.ai CEO Amjad Hussain Bootstrapped using Services from Michigan . Seed Investors Who Like Bootstrapped Businesses . How iHeartRaves CEO Bootstrapped a Niche e-Commerce Company to $20 Million . Bootstrapping with Services . How The Intern Group CEO David Lloyd Bootstrapped to $13 Million . How Passageways CEO Paroon Chadha Bootstrapped from Indiana . How SmartBuyGlasses CEO David Menning Bootstrapped to $50 Million . Death by Overfunding . How RainmakerForce CEO Mack Sundaram Bootstrapped Decisively to $5 Million+ . How FormAssembly CEO Bootstrapped a Virtual Company with a Paycheck . TimeSlips CEO Mitch Russo Bootstrapped to Exit with Sage . The VC-Entrepreneur Compensation Disbalance . BioConnect CEO Bootstraps with Sophisticated Strategic Maneuvering . Tremend CEO Marius Hanganu Bootstraps from Romania . Gesture CEO Jim Alvarez Bootstraps to $10 Million . SproutLoud CEO Bootstraps to $30 Million from Florida . Tuft & Needle CEO Bootstraps to Over $100 Million . Co-founders Bootstrap Linguamatics to Over $10M from the UK . Ownership Matters . Vainu Co-founder Mikko Honkanen Bootstraps from Finland . Entrepreneur Couple Bootstraps to $10M from Colorado . Power2Motivate CEO Bootstraps to $80M from Canada . Financial DNA CEO Bootstraps to $10M+ from Australia . Big Barker CEO Bootstraps a Niche E-commerce Brand . PrecisionLender CEO Bootstraps to Over $10M from North Carolina . Master Bootstrappers with Over $1B in Exits . Ultra Mobile Founder Bootstraps to Over $100 Million . Bootstrapping a Two-Sided Marketplace to $10M . Can You Bootstrap a Virtual Company to Over $5 Million? . Capital Efficient Entrepreneurs Turn $1M into $80M . Discussing the Journey Through Failure to Success . From a Small Town to $12 Million . Bootstrapping to Y Combinator and $10 Million Series A . Bootstrapping a Marketplace to Over $10 Million . Freightwise Bootstraps to $33 Million . Bootstraps First to $5M ARR, Raises $10M Later . Bootstraps in Europe, Raises Money and Goes Global in the US . English Major Bootstraps a Tech Company . Bootstraps with a Paycheck to $15M from Tennessee . Queue-It Bootstraps from Denmark to the US . Bootstrapping A Virtual Company To $25M . ActiveCampaign CEO Bootstraps Using Services to $40M . Alteryx Bootstrapped with Services to a Public Unicorn . Inspyrus Bootstraps Using Services to an Awesome Business Model . CEO Bootstraps Using Services to Millions from Russia . Wiredrive CEO Bootstraps Using Services to $10M . Scaling to Over $10M by Bootstrapping Using Services . Bootstraps Using Services from Poland to a US SaaS Company . ButcherBox CEO Bootstraps a Perishable Meat Business to Significant Scale . Waveform CEO Bootstraps to $8M . Bootstrapped Entrepreneurship from Estonia . From Laid-off Engineer to Successful Startup CEO . Imagine Easy Solutions CEO Bootstraps to Exit . BannerBuzz CEO Bootstraps to $35M . Bootstrapping a Virtual Company to Scale . Bootstrapping Using Services from Wisconsin . Best Tactic for B2B Startups . Bootstrapping by Piggybacking from Romania . Bootstrap First, Then Scale with VC Funds . Bootstrap to +$10M First, Raise Money Later . Madwire CEO Bootstrapped First, Raised Money Later to $120M . Bootstrap Using Services First, Raise Money Later . Wonderful Bootstrap with a Paycheck Story . RushOrderTees CEO Bootstraps to $23M . Bootstrapping with Freemium and Free Trials to $13M . Bootstrapping, Pivoting, Gaining Liquidity, Scaling to $100M+ . Bootstrapping with Affiliate Marketing . Bootstrap to Exit, Bootstrap Again, Then Raise VC Money . Bootstrapping Using Services to $12M . Bootstrapping an Ad Tech Company from Paris . Bootstrapping a 100% Virtual Company from Ireland . MiQ CEO Bootstraps with Services from London . Bootstrapping to $8M During the Covid Crisis . Bootstrapping a Marketplace from Brazil . Bootstrapping Using Services from Sweden . What Should Startups Do To Raise Seed Capital in 2021? . EdTech Unicorn Bootstrapped First from Canada . Coalition Technologies Co-founders Bootstrap to $10M . Bootstrapping a Virtual Company to $10M from Atlanta . Bootstrapping a SaaS Company with a Paycheck and Scaling . Bootstrapping with Services to $20 Million