I Didn’t Put My Earnings Back Into My Startup. Here’s Why.
When you are bootstrapping a startup, and you first start making money, it's straightforward advice to put “the money back into the startup.” It shows commitment to grow, they say.
I found it to be precisely the opposite. For me, I decided to take the first thousand dollars and paid myself.
The reason was this:
When I started, my big goal was to get to a modest couple of thousand dollars of recurring revenue per month. Probably enough to match my salary and quit my day job. That goal, amongst creating a great product that people used, charged me up, and kept me going. When I achieved it, there was a great sense of relief. And the monthly recurring revenue kept growing past my goal, and the spirit of assistance turned into confidence.
I didn’t like that.
I needed that goal back again. I need the feeling of the climb from zero to 2–3k back again.
So I made it that. I took the money away from the company and paid myself. So I better build the recurring revenue back up again.
I know this is pretty silly, even stupid but anything to keep the interest going in the beginning stages.
Startups fail not because of a lack of money, but because the founders quit. They lose interest, drive, challenge, and accept defeat. It has happened to me many times before. Not that I would have stopped this time around, but it’s fun to have a laser beam to chase.
Keeping the heart in the business is more important than saving money.
I am the founder of Proxies API and if I can do it, you can too.