Bootstrapping to Exit and Bootstrapping Again (and Again): Adam Robinson, CEO of Retention.com and RB2B (Part 7)

Sramana Mitra: Very good. So, this one is at $1.5 million already?

 Adam Robinson: $1.7 million within nineteen weeks. It was very fast. It was just five people.

Sramana Mitra: So that means this year is going to close at probably $5-$6 million, right?

Adam Robinson: We’re adding over $50K MR a month. I think we’ll get better at it. Churn in the beginning, in my experience, is always terrible. Then you figure out how to get it lower. I think we’ll be at $4-$5 million by the end of the year and probably between $10M and $15M by the end of next year.

Sramana Mitra: So I learned something really interesting in this conversation, which I think people should pay attention to. It’s that you can build some sort of a cash business that may or may not have an exit, but you can spin out something else. You can also use some of the profits of that business to incubate something else that may have higher potential.

I’ve seen this specific use case before in Zoho, by the way. I love that. Sridhar Vembu bootstrapped a network management software business with a small amount of money. It wasn’t a very large amount of revenue, but he incubated Zoho within that pool of cash. He bootstrapped Zoho to over a billion dollars in recurring revenue. So it’s an amazing story.

I think what you’re reminding me of is that story. Of course, you haven’t hit that kind of a stride yet, but who knows, right? What I love about your story is that there’s a lot of flexibility and a lot of freedom to experiment and play around because you are building a cash generating business.

Adam Robinson: And we have no one to answer to. You were like, “Thank God, you didn’t take that that growth equity.” Honestly, I’m most thankful for it. I really don’t think that investors would approve of this go-to-market strategy. It’s so not what they like. They might have been like, “OK, we’ll let you try that.” It’s really working right now, but if it didn’t work, then they’d be like, go hire the sales and force your product out there.

Sramana Mitra: You know, I’m very uncomfortable these days given what’s going on about hiring lots of salespeople and bloating up your burn rate and then just not really hitting the kind of numbers that you need to support that kind of sales expansion. That is the way venture capital funded startups are built. It’s like, you just hire and hire, and you have to deliver. I mean, it’s a very high stress environment. There’s no room for any margin of error. I don’t think human beings function well in that level of stress. It’s a shitty quality of life.

Adam Robinson: I agree. Meanwhile, I’ve had a ton of my life. I promise you.

Sramana Mitra: Yes, I completely understand.

Adam Robinson: I love this stage so much – just going from zero to ten. I just think it’s so fun, especially doing it super lean.

Sramana Mitra: Super lean and no stress.

Adam Robinson: Now that I’m creating content about it as well, I get so much energy. You know, this whole Roger Bannister’s four minute mile breaking new grounds thing, now I’m going to be able to tell people that not only is it possible, I just did it twice in a row. I got to $10M with under ten people. Just do it. If you want to create a unicorn after that, do it. You don’t have to take money until $10M. If you can make it that far, then the world is at your fingertips.

Sramana Mitra: Yes. In a sense, your bootstrapping to exit strategy is, sometimes your exit is funding another idea within your bootstrap venture using the cash to experiment with something. I love it. It’s really cool, really creative, and very interesting. Well, congratulations. It was a great pleasure speaking with you and catching up and wish you all the best.

This segment is part 7 in the series : Bootstrapping to Exit and Bootstrapping Again (and Again): Adam Robinson, CEO of Retention.com and RB2B
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