Serial Bootstrapper: Oversee and Manage Founder Fred Hsu (Part 2)

Sramana Mitra: Is this the company that you’re running now?

Fred Hsu: No, that company was actually called Oversee. It had started around 2000. It was completely bootstrapped. Our first investor was my mom. She helped us buy our first server. That company grew from zero to eventually $230 million in annual revenues from 2000 to 2008. It was wildly profitable. It had a lot of EBITDA than a lot of public companies that I see today. That company was eventually sold to a private equity firm in 2009.

Sramana Mitra: How far did it go? What kind of revenue levels did it reach?

Fred Hsu: It reached $230 million in annual revenue. >>>

Serial Bootstrapper: Oversee and Manage Founder Fred Hsu (Part 1)

If you haven’t already, please study our free Bootstrapping course and the Investor Introductions page.

Fred has bootstrapped two companies with huge amounts of revenue. The first, he sold to a private equity firm. The second, he is still running. Amazing story!

Sramana Mitra: Let’s get started at the beginning of your personal story. Where were your born, raised, and in what kind of environment?

Fred Hsu: I was born in Ohio. My parents were Chinese immigrants who came to the States for graduate school. They had moved to Taiwan during the communist takeover. I have an older sister. She was born in Virginia. I also have a younger brother who was born in Connecticut. We moved around a lot as kids. My dad was a defense contractor moving from one air force base to another. My mom was an accountant by trade. She fell into the insurance industry and eventually, programming. >>>

Bootstrap First, Raise Money Later: Ensighten CEO Josh Manion (Part 7)

Sramana Mitra: This is something that we are very much in alignment with. Our principle in the 1M/1M methodology is ‘Bootstrap first and raise money later’. The more you can do without raising money and the more carefully and more thoughtfully you can setup the foundations of your business outside of a venture clock, the better off you are in every dimension. You are essentially a great case study of exactly that philosophy.

Josh Manion: It sounds like we have a similar view on this. If I were meeting for coffee with an entrepreneur asking for advice, I would be saying, “What’s the fastest way for you to get a product to market and start learning from your customer? How can you do that yourself? What corners can you cut so that you can be the one who does that without going out and raising real money?” Angel money is maybe a little bit in the gray area depending on who it comes from. You’re never more efficient than when you’re spending your own money.

Sramana Mitra: No question about that. You raised money in 2012 and you raised a substantial amount. >>>

Bootstrap First, Raise Money Later: Ensighten CEO Josh Manion (Part 6)

Sramana Mitra: Interesting. I see what you’re doing. Did you start this company in 2012?

Josh Manion: 2009.

Sramana Mitra: At that point, you self-financed this company based on money from your consulting firm, right?

Josh Manion: That’s right. My wife and I decided that we would bootstrap it while we were building the technology. That started at the end of 2009. That mode persisted until September of 2012 when we closed our Series A.

Sramana Mitra: Were you doing all this in Chicago? >>>

Bootstrap First, Raise Money Later: Ensighten CEO Josh Manion (Part 5)

Sramana Mitra: Talk to me a bit about how the product is architected. You talked about what other people cannot do. What is it that you do? How do you architect the product that you can do something different and better?

Josh Manion: That really started from the inception. When we looked at solving the problem, the solution that formed in my mind was that we needed to create a platform that was completely simple to implement. It needed to be as easy as saying to a customer, “Just put that one line of code on your page and our application is fully installed.” Once that was there, it would enable our customers to leverage our application to literally drag and drop any of these digital marketing vendors on to their site in a way that would be controllable by the marketer and no longer dependent on the external forces or things like waiting three months for the next release to your website.

Sramana Mitra: Give me an example. Let’s say this tag is in place on your website. What other application are they trying to tie-in to that process? >>>

Bootstrap First, Raise Money Later: Joe Speiser, CEO of Little Things (Part 7)

Joe Speiser: We spend a lot of time looking at, “How can we engage the user? What kind of content can we show them to keep them interested?” What does that [time spent] look like? Is it one minute, two minutes, or three minutes? What’s that number? Right now, we’re up to 3 minutes and 30 seconds, which we think is pretty great. Because of that, Facebook treats us well. They show our content more because the readers on Facebook enjoy it. It’s not just time on site. It’s also how many times is the post being shared, liked, or commented on.

Facebook also looks at the negatives. They follow and watch very closely how many times someone unfollows a post. If you hit a certain threshold there, Facebook will take action against your page – not manual, but automatic. They’re going to demote it in the news feed moving forward. That has negative points against your fan page. You accrue enough of those and your page gets buried. >>>

Bootstrap First, Raise Money Later: Ensighten CEO Josh Manion (Part 4)

Sramana Mitra: What was that insight?

Josh Manion: No matter what we did with those customers, the amount of value that they were able to realize was this tiny fraction of the potential value of all the different technologies that they would use. You could think of it this way. The vendors of this time told a wonderful story about the Holy Grail of marketing. Our technology will allow you to deliver the right message to the right customer at the right time. None of it actually worked or none of it was actually possible in the real world. That was because the enterprises that we worked with had no ability to take an action on their website, on their mobile app, or on the social media platform without going through this laborious process of working with their IT department to define the changes and get something out in a release. All of it was massively fragmented. >>>

Bootstrap First, Raise Money Later: Joe Speiser, CEO of Little Things (Part 6)

Sramana Mitra: What is the focus of the content? What is the editorial strategy of Little Things?

Joe Speiser: The whole goal for Little Things – and what we’ve stuck with since the beginning – has been uplifting content – the opposite of what the nightly news represents. Our goal was to stop this constant flow of negativity. Everyday there’s a robbery, kidnapping, or murder but who wants to be constantly bombarded with that? Even though murder is down significantly in the US, the amount of reported news of it has gone up in the opposite direction. We’re now bombarded with more negativity than we ever had before, just because of the way the Internet is set up. Everything is at your fingertips and the notification just keeps coming through.

Every media outlet makes a lot of money off negativity. We thought we’d try something different with this and it’s been working. We’re literally putting out as much positive news as we can and people are actually interested in spreading good news. I think when you watch or read something that makes you feel good inside, you want to share that feeling with the people closest to you. >>>