Nine lessons learned bootstrapping a $1B+ hardware startup
By Eric Paley
How do you bootstrap a $1B+ hardware startup?
SimpliSafe founder Chad Laurans recently shared some wisdom with our portfolio:
🪤 Avoid the “trap of perpetual unreadiness”
🎯 Have a hiring “hit rate”
♻️ Start succession planning from day one
Here’s more…
🎯 Have a hiring “hit rate”
If you’re scaling quickly, you’re not going to hire perfectly. However, many managers fear losing face by admitting they made a bad hiring decision. Give them a permission structure to end poor fits before they poison your organization.
☑️ Reference people early
Chad urges hiring managers to call references as soon as they’re first excited about a candidate. Leaving calls until too late in the process leaves you susceptible to sunk cost biases and robs you of the ability to get insight on negative feedback.
🔐 Know thy market
The home security market has many attractive qualities, but few typical markers of VC-backed startups — No network effects, winner takes all dynamics, etc.
This meant Chad didn’t have to raise a ton of capital to compete in an effort to “get big fast.”
🪤 Avoid the “trap of perpetual unreadiness”
One of the hardest things to do as a founder is to ship a product that feels unfinished. However, it’ll almost never be truly “ready.”
Solve for the key value proposition and fix the rest in version 2.0.
🔽 Focus on the bottom of the funnel
In the earliest days, you are better off focusing on the lower portions of your marketing funnel.
Focus on getting more of the people who come to your site to convert rather than trying to get orders of magnitude more people to visit your site in the first place.
📞 Customer service > Consultants
Make your executive team answer customer service calls and probe online reviews before hiring expensive market research consultants.
Your best users are probably telling you what you need to know — and certainly what you need to fix.
🏠 Visit your customers
Users will find workarounds for shortcomings in your product that you could never imagine. Whether you sell SaaS or consumer goods, learn from your users where they live and work.
📢 Internal communication won’t scale itself
When Chad’s entire team was crammed in a single office it was easy to perpetuate the culture he envisioned. When the team grew to hundreds of staff, internal comms became a mission-critical project that had to be managed closely.
♻️ Start succession planning from day one
Everyone on the team should be preparing to pass something on — be it responsibility for the email newsletter, to the CEO chair. In order to foster a culture of advancement, people have to be prepared to let things go.
