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Apr 26, 2019 14:09:27

Phases of the Entrepreneur Career

by @basilesamel PATRON | 465 words | 330🔥 | 372💌

Basile Samel

Current day streak: 330🔥
Total posts: 372💌
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These days I noticed most bootstrapped tech entrepreneurs go through four phases to make a living from their craft.

It starts with an apprenticeship where the entrepreneur develops a making habit. Challenges similar to "12 startups in 12 months" are typical of this stage, that's when you learn what it takes to launch your own product and to market it. The apprentice must learn to execute fast without a consequent budget and kill ideas even faster. Apprentices can benefit from online and local communities gathering indie entrepreneurs. The apprenticeship phase is also the moment when you might want to start developing your personal brand by documenting your experiments, not only to nurture a network but also to integrate a routine of introspection.

At some point, one of your products shows more traction than the others and you make your first revenue. This milestone leads to the second phase: Incubation. The goal of the incubation stage is to reach ramen profitability from your tech products, meaning, to cover your living expenses. Launching and growing products are vastly different: most people are unable to launch, but maturing a startup is way harder than launching something because it's nerve-wracking. Growing your monthly-recurring revenue involves listening to tons of feedback, to be integrated in an optimal fashion. Anyone can launch something and make quick cash, but growth is an order of magnitude above, it's basically becoming a parent: to some extent, the product comes first. In this phase, you must focus on one product, so avoid diluting your precious time in endeavors unrelated to the business at hand. Launching spin-offs products is a good thing, however. Important problems have sub-problems, there is an opportunity to address each one without deviating from the main problem.

Then comes ramen profitability, you are in a pre Product/Market fit stage. The growth is not exponential, but you acquired an unlimited runway to develop your business and your personal finance is no longer an issue: you can dive full-time into your venture without any worry. That's the phase where you might want to join a startup accelerator/incubator and use paid advertising if it's relevant.

Finally, you reach P/M fit and you are faced with two choices: grow big or grow lean. Growing big is becoming a more traditional startup: hiring employees and growing revenues, possibly acquiring external funds. Growing lean is about staying as small as possible while creating more income streams (diminishing the costs to the minimum while maximizing the revenues), by staying indie and becoming a serial maker. Most YC companies are an example of the former, while Pieter Levels and Marc Köhlbrugge illustrate the latter. Of course, there are in-betweens, such as Basecamp, Ghost, or Buffer.

Disclaimer: this model is meant for simplification purposes, it's not exhaustive in any way

From Basile Samel's collection:

  • 1

    @basilesamel pretty accurate picture I must say!

    Jason Leow avatar Jason Leow | Apr 26, 2019 21:53:25
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    I was just curious. I know it's just a phrase... but do people who hit 'ramen-prfitability' literally eat shitty food like ramen all the time?

    Sir Abe avatar Sir Abe | Apr 26, 2019 15:14:24
    • 1

      @abrahamKim No, entrepreneurs know they need a healthy diet to work at their best :P

      Basile Samel avatar Basile Samel | Apr 26, 2019 15:24:21
  • 1

    @basilesamel Insightful. Thanks.

    Seun Oyebode avatar Seun Oyebode | Apr 26, 2019 13:25:36
  • 1

    @basilesamel great observation Baz. It looks like there are missing part, in my opinion: At the beginning stage—skills acquisition, working on job/freelance to keep afloat before diving fulltime ( while building the 12 startups challenge.)

    Chris 🤔🇵🇭 avatar Chris 🤔🇵🇭 | Apr 26, 2019 20:21:05
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