The Stair Step Method of Bootstrapping - Rob Walling - Serial Entrepreneur by Rob Walling
Steps
Your First Product
Start with a single-sale product instead of complex SaaS with recurring revenue. Running SaaS with recurring money is tempting but it also ties you to developing it further.
Also, he says
It’s much easier to sell an add-on to an existing ecosystem like a WordPress plugin, a Shopify app, a Heroku add-on – they’re usually small things to build, relatively inexpensive for customers to purchase, and you have built in discovery through the plugin repository or app store.
Own Your Time
Step 2 is doubling-down on the model that worked in Step 1 and repeating it until you own your time. You may be able to grow a single product to achieve step 2, or you may need to cobble a few together.
“Own your time” means making enough revenue to not have to work another job (at least I think). He’s not super clear on that.
Recurring Revenue
Now that you’re generating enough income to justify going out on your own, and you have the experience and the mindset of someone with a few successes under their belt, it’s time to level up and take a bigger risk by going after a stand-alone product with recurring revenue.
It’s easier to undertake a longer, more complex product/service when your smaller projects are bringing enough revenue to focus on the new project full time.
While some percentage of your customers will churn, this model gives you incredible leverage to grow your business – if you’re providing a good product, you will retain the vast majority of your sales month over month.
That’s a big part of the reason why SaaS is so popular with bootstrappers.
But the other side of the SaaS coin is that there’s along ramp to any kind of substantial revenue, which is why I recommend you complete steps 1 and 2 before moving to this step.
References
Wilhelm Klopp referenced this blog post in How to monetize your side project for fun & profit - YouTube at DjangoCon Europe 2024.