Built my last co to $2.5m ARR, became profitable in 2.5 years, sold it for mid-8-figures, and going even bigger this time. AMA!
Hey IH!
I'm Chris Bakke, the founder of Laskie.com - the best way to hire great contractors and full-time-employees.
I previously founded Interviewed, which was started in 2015 and acquired by Indeed in 2017.
We scaled to $2m+ in founder-led sales, became profitable, and learned a lot along the way.
Excited to share + learn from this group.
AMA.
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What's driving you to go bigger? How are you personally deciding what direction to go in life after having multiple big exits and becoming (presumably) quite wealthy?
Enjoying this AMA, and thanks for the comment!
In terms of direction: we wanted a big, tough market this time around. There's a lot of competition in hiring, but also a lot of money, and sometimes it's easier to do a hard thing in a massive market than an easy thing in a smaller market.
I tell myself that every day, and I'll let you know in 5 years if that's actually true :)
In terms of drive: after my last company was acquired, I watched our team buy their dream houses, relocate to new cities, put their kids in better schools. Getting wealthy with your friends and coworkers is a lot of fun.
Today, I get to operate a business where I hopefully watch our own team 1. learn a lot, and 2. have enough money to do the things they want in life - but the nature of being in the hiring business is that we also get to do that for hundreds of other people who are looking for new freelance and full time opportunities.
Breaking into exceptional companies (as a freelancer or an employee) is tough, and if we can help a bunch of people get those opportunities, then I'm happy.
Hey @chrislaskie you experience seems robust and an exciting journey! Thanks for helping out the community with this AMA post!
I've been building ruttl for the past one year. I've got few doubts that maybe you can answer with regards to your experience -
Eager to hear your answers, thanks!
For sure! Good to be here.
Congrats on getting started this past year.
Everything I've ever done in startups has been inside sales focused. This is the playbook I've used across 4 companies now: https://playbooks.laskie.co/bootstrapping-b2b-sales
My biggest product lesson is that most founders over-think the actual product. You don't need to make a 10x better experience. You need to make something 5-10% better to build a huge company. Also: ignore this if you're doing something actually innovative + you enjoy it. The world needs people like you. I'm just a simple B2B guy who is all about subtle, incremental changes.
100%. So much tech is already bought through recommendations, referrals, and case studies. Huge opportunity here.
Your playbook is great! Thanks a lot for that.
Thank you so much for this valuable reply!
Firstly, the playbook is really good. It's filled with so much information that I'm going to take out time to read it in depth.
Secondly, I totally agree with you on making things 5-10% better. Ultimately if your product does improve the lives of people, they will keep using it anyways. After that there is always a scope to keep improving.
And finally, thanks for the opinion on influencer marketing. I've been considering it for quite some time now.
Hey Chris, what's the lowest ARPU (Or LTV) that you would consider makes sense for hiring salespeople?
Hey Kevin, the lowest amount I've seen (barely) work at scale is when you have customers paying ~$5,000/year.
If you have a high-margin product or service, sales cycles are extremely fast, salespeople are low-cost, you can one-call-close a lot of people, retention is high, etc. you can make this work. Yelp and a few others make salespeople work in this range.
Generally, a good rule of thumb for hiring salespeople is when you can sell in the $20-30k+ ACV range.
Congrats!
Did you have an idea of the type of problem to solve before doing the mom test?
Wait, by "mid" 8-figures you mean "between $10m and $20m" or "around $50m"? If it's the latter, how did you manage to sell a business for $50m with $2.5m ARR?
Heck, even if it's the former, that's a nasty 5 to 10 multiple. How did you get it that high?
EDIT: Did you bootstrap it?
Around $50m. Was a strategic bet + purchase, which is how you often get high multiples (as an extreme, the first startup I was at did $550k ARR and was bought for $45m by a strategic buyer as well). Not common, but it happens.
Many people are surprised at how often large companies will throw around $10-100m on a medium-sized strategic bet or to solve an annoying problem.
Also, when you're thinking about selling: create a bidding war with multiple options - i.e. talk to VCs to see where they would fund you, ping competitors in your space, etc. That's how you might go from 20x revenue to 25x revenue on the outcome.
Holly molly !!!! Super super super interesting!!!
Holy shit. How much % of the company did you own?
Did you approach them first or they came to you? Did you use a broker?
Hey Chris, congratulations!
I am on the path to starting my own SaaS business and I want it to become profitable.
I have an general idea in mind + the problem and solution. What do you think is the best way to go about validating the idea to ensure that it will gain profit?
Also, what are some common mistakes you see in others when they try to build a profitable SaaS?
Thanks so much!
Hey Brayden! Congrats on building your business.
Have you read the Mom Test?
https://www.amazon.com/Mom-Test-customers-business-everyone/dp/1492180742
It's a quick read with some decent frameworks on how to do customer development.
We started Laskie by interviewing 120 people over 3 months and asking them about their biggest challenges at work, or some variation of "what's the hardest part of your job?"
From there, we narrowed down to people with specific hiring challenges and started digging in and trying to spend as much time with them as possible.
The book talks about this, but it's a huge mistake to "lead" people too early on to give direct feedback on your idea.
If you tell someone what you're working on and ask for feedback, no one wants to be mean, so people say nice things, but then founders are shocked when the market doesn't buy it.
If you start with an open conversation, you generally can find some pretty interesting problems, and can narrow in more and more to see if there's an opportunity to talk about what you're building.
I love the mom test. I literally wrote something related to that here https://link.medium.com/oI1oYOtiEgb
I’ve heard of it, it’s been on my list! I’ll definitely check it out.
Also, thanks for those tips, I’ll try that. Thanks so much!
Congratulations!
Parabéns !!!
Muito feliz .
What was your tech stack?
Hey @chrislaskie, a quick question regarding the number of teams/contractors and the number of projects (let's say per one month). How do you keep the balance between those two? I.e. are there periods when as a contractor you wouldn't be able to find a project for a considerable amount of time?
Asking for a friend of course.
Hi Chris
Besides the influx of cash at your disposal, investor interest, and huge network of experts, what's been the experience difference for you between starting company #1 and #2?
I'm thinking a bit of the Justin Kan story here and just wondering how you move from massive success into square 1. In his case it was a series of big missteps even with all of those aforementioned things now at his disposal. In fact, largely that previous context probably influenced a lot of that decision making his case - pressure, speed, unbelievably high expectations, etc.
How are you navigating that context shift?
This is something I think about a lot.
My current belief is that it comes down to understanding what worked well for you the first time or two, and not deviating from it too much.
We deliberately didn't raise $1 of outside investor capital into my current company until I had put $100k+ of my own money in and spent months to prove out the concept.
I closed the first $1 and then the first $10,000 and then the first $100,000+ of sales at this company before we started to hire salespeople.
We're obsessed with costs, keep a low burn rate, try not to get caught up in the investor hype cycles, etc.
Although we're taking slightly bigger risks this time, I think of "going big" largely as running a company for 10-20+ years vs. 2-3 years spent on the last one.
Big companies take time, and it's difficult to hack that in the early days with silver bullets. Not sure those exist.
The first couple years are just pushing rocks uphill every day - it doesn't matter whether you're worth $1b or $1.
If you have time for a quick follow up - for successful repeat founders often it seems like venture #1 is hyperfocused in a niche and #2, #3, ..., feel like huge problems / huge risk / huge markets.
Could you speak to that difference as someone sort of on that plane? Is it just risk mapped to reward or does some change in mentality come with it (I solved x therefore I can solve 100x) as well
I would guess it's largely risk/reward. Making $1m or $10m isn't particularly appealing if you've already done it?
There's certainly some hubris involved as well: "if I nailed this $100m market, how hard can a $100b market be?"
I strongly believe this is true as well:
https://blog.samaltman.com/hard-startups
Hi Chris,
Thanks for posting. How do do lead generation on the B2B side of your business? How do you plan to compete with sites like TopTal, Gun, Upwork, etc?
You clearly have a track record of success, I just want to Better understand your thought process around entering such a competitive space. I admire the boldness!
Hey Steve, appreciate the questions. It's a pretty manual B2B sales process, selling into mid-market and enterprise companies.
This is our outbound process: https://playbooks.laskie.co/bootstrapping-b2b-sales
The sites you've listed (and many more) are mostly fine at what they do. I haven't personally used Gun, but Toptal is doing good work, I was previously spending $2m/yr on Upwork at my last company, and there's a real vetting/quality problem there.
After scaling a company in a hyper-niche space last time around (non-technical candidate assessments), we wanted to be in a huge space this time around. It's so much better being in a massive space with 50 other companies vs. being in a tiny space competing against 3 other companies.
For comparison, Toptal+Gun+Upwork's revenue is around $600m combined. There are many, many F500 companies individually spending $500m-1b+/year on contractors.
The real competition comes from the incumbents like Randstad, Adecco, etc. - all highly manual operations with $25b/yr revenue, and I welcome that competition.
Hi Chris!
Obviously I'm way late to the AMA party, but read through the comments with interest, and definitely checking out your bootstrapping playbook.
I'm hoping you might be willing to connect with me. I'm working on a platform called Ditto. We handle payments and project management for contractors and clients, with escrow functionality to ensure satisfaction and timely feedback. So if you put Ditto and Laskie together, you'd basically have a (better and cheaper) version of Upwork with higher-end talent. Seems to me there might be some opportunity to collaborate?
Would love to chat.
And thanks for taking the time to share your experiences!
Solid mate and thanks for giving back with this AMA 🤙
Hey Chris what is the process/methodology of screening freelancers and agencies to provide services. Do you find them on sites like Upwork and review their work? Also, what is the payment structure like (if you don't mind discussing). What I mean is let's say you have screened a freelancer or agency for a service, how do you agree on the pricing e.g if they charge $30/hr on upwork, would they also charge $30/hr on laskie and laskie takes a percentage cut?
Hey @chrislaskie first of all congratulations. Hats off. You made it twice, and that means you re just good at what you are doing! Any books, blogs , youtube movies, that you yourself found helpful starting SaaS business? What I am struggling most right now is validating ideas at every field: marketing, programming, ux, etc. there are so many routes to choose, so many ways of doing something, that it can be really overwhelming to decide which features, solutions, methods could be useful and which are just simple time-wasting. Any tips?
Hi Chris, Great to hear about your last exit and current product. Recruitment is still broken for sure. Hope laskie can bring revolutionary changes. What is your opinion about the audience first approach? Did you build audience first before launching your product? Would be great to see opinions from people who already built and succeeded!!!
I'm building clapup.me, and after seeing lot of hype from twitter about audience building Kinda confused. When i dived deep into their profile, either its shallow and mainly they sold courses.
Hi @chrislaskie, I saw your current venture is more or less a marketplace play.
Were your precious startup a hiring/staffing marketplace endeavor?
We are engineers building an SaaS enabled educational marketplace (giving out the tool to the suppliers and hopefully get the traffic) — think of outschool, but in a niche.
But a friend of mine who has more business experience than me said that I should find a way to monetize the SaaS tool instead of going down to the SaaS journey — he said two-sided marketplace is an extremely hard problem. When I started looking at how to grow both the suppliers and demanders, I do sense it’s a hard nuts to crack.
Could you please share some experience?
Previous company was SaaS.
Current company mostly monetizes from longer-term hiring contracts.
Marketplaces are hard. SaaS is also hard.
Why not try selling both?
Selling both in parallel can be a challenge to balance, but take 2 months dedicated toward only selling the SaaS solution and see where you land. It may very well be a better business than the marketplace. Or maybe not, but at least you'll know + have stronger conviction moving forward.
Great to hear @chrislaskie! Are you a technical founder or non-technical?
Non-technical, but I have worked with my co-founder + our founding engineer for almost 9 years across 4 companies (42Floors, Interviewed, Indeed, and now Laskie).
They're both exceptional and I wouldn't be here without them.
That's awesome. I see many people asking about being a non-technical co-founder for SaaS and other tech companies, so it's cool to get another example of how this could work.
Hey Chris ,
I know this is such a naive question but i am reading about all this startup stuff from about an year . And cant get to start anything . So i wanted to ask how do u go from idea to execution .
Force yourself to make $1 on the internet this week.
It can be a service, consulting, building a quick product, shipping a product on Gumroad.
Then next week, try to make $50.
Try lots of things. Just bias toward taking action.
Hey Chris,
I built a SaaS myself but I'm really struggling with Marketing. I studied so (too) many things but I don't know where to start.
As a soloproneur with little to no budget, what do you suggest ?
Hey Younes! I don't know a lot about traditional marketing channels myself. I've always started and worked at companies with a higher contract value so we can run an inside sales process.
Here's how we do inside sales at my last two companies: https://playbooks.laskie.co/bootstrapping-b2b-sales
This may or may not help depending on the product/service you're selling, but it should give you a primer on how to get your next 10 customers with a little bit of manual outreach and hustle. LMK if you have questions after you take a look.
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