“How to bootstrap a SaaS application globally”
by Alexander Peiniger, quintly
Who are you and what do you do?
My name is Alex and I’m a co-founder and the CEO of quintly. Together with my brother Frederik, we started our company “quintly” in 2010.
Your startup in one tweet…
quintly empowers organizations to use social media successfully by providing analytical solutions to optimize their social media strategy. In easy words it’s like Google Analytics, but for social media channels.
Often startups have a “founding legend”. Do you have one? How did you come up with the idea?
Ours is actually pretty simple. We started as a tech agency and wanted to get out of the project based work and build a product that can scale. quintly, which was called “Social.Media.Tracking” back then, was born out of a specific client need and we saw the potential to also offer it to others. It took us about 2 years though to focus 100% on quintly.
You founded the company together with your brother. Would you advise others to found with close family?
I don’t like to give general advice, because situations are always different, but I am happy to share my experience. In our case we as brothers are pretty similar so we never had any big disagreements. Things are so much easier if you have a co-founder that you can fully trust and share the challenges with. Over time, we also developed our focus areas so that we don’t need to agree on every little aspect. Speaking from my own point of view I would definitely recommend it, but many people told me over time that they could never imagine this with their siblings. It’s probably best to give it a try 🙂
You have an interesting funding history. You had an investor but then you bought back the shares. Can you share some insight into what happened and the motivation for the buy back?
When we got a US investor on board in 2011, we had no clue about funding, how to scale and all the other things needed. With our tech background we were just focusing on building a great product for our customers. In the end I believe we were a bit too “German” from a US point of view with the focus on profitable growth. In order to best match the expectations of all parties we decided to buy back the investor shares at the end of 2012. It was definitely a stretch for us, as we needed to invest quite a bit of personal money and even borrow some. But we always believed in our product so there was not a single point in time where we questioned that decision.
Would you advise others to bootstrap their company? What are the pros and cons for you?
Bootstrapping is a great way if you have a strong product focus and a market that can create revenue early on. This was the case in our B2B SaaS model, so we decided to go that route. In our case bootstrapping also fits pretty well to our entrepreneurial beliefs, which are focused on profitable growth and building something sustainable. There are definitely business models out there where this will not work and where taking funding is the best way. I admire all the founders that can raise these big funding rounds and create a lot of growth with this, but it’s just not for me personally.
Tell us about your first paying customer. Who was it? When did it happen? How did you acquire them? Do they still use your product?
Back in 2010 we were working with HRS in Cologne and we built a very simple prototype that could show Facebook fan numbers over time. In the weeks after we opened the product for other companies we got first agencies onboarded as well. We are really proud of our retention numbers from early customers, so even now after 8 years, two of the first three customers are still with us.
What were your biggest stumbling blocks when you started?
For us as tech founders the biggest learning was that a great product alone is not enough. In the beginning we didn’t want to do marketing and sales and believed that people will just come and buy. It took us about 3 years to understand what we needed to do to get onto the growth track. In the end each of us was sitting there with 10+ calls every day with potential customers to sell our solution. Not only was it a great learning for us personally but it also gave us so much more insights into the needs of the customers. Since then I believe that founders profit from doing everything themselves at least until they understand the mechanics.
At the moment, how do you measure success? What are the key metrics you look at?
We measure success in a lot of different ways depending on which area of the company you look at. Of course, one of the most central metrics is MRR (Monthly Recurring Revenue) which shows us the overall resulting growth of the business. But as we want to build a very sustainable company we also focus a lot on churn rates to make sure we serve our customers in the best possible way and that the customer base grows in a healthy way. We are also big believers in long-term success, so all our decisions will be for the long run and not for optimizing numbers to look good.
How do you acquire customers? What are your main growth channels?
Our main growth channel is content marketing and organic growth through SEO and recommendations. As a bootstrapped startup we didn’t have the resources to just create attention with money, so we needed to find clever ways of growing. That’s probably also the reason why it took us so long to get to a certain size. The good thing about it is that nowadays these organic channels are so strong that we can rely on them as a base without a lot of advertising spend.
The company has grown quite a bit in the last years. What are your learnings “growing up”?
The biggest learning for me personally was to focus on the long run and not to be distracted by what you hear in the market. Competitors come and competitors go. Having a great product and focusing 100% on your customers needs is the best protection against losing. At first this sounds naive but building this extreme trust with our customers was always one of our strongest assets. I also believe that our sustainability and the trust form big parts of the culture that we have within the quintly team today. It allows to be authentic in any situation inside and outside of the company.
What advice would you give young founders?
A few things come to my mind: Stay naive. Stay curious. Don’t be afraid of things you haven’t done before. Don’t believe in all the hype and inflated stories you hear. Don’t treat funding rounds as a success measure. Trust your entrepreneurial gut feeling.
Cologne is for Startups…
…great, because you can focus on your work in an environment that offers lots of opportunities. We are very happy to be in an area where you can still find great talents and where we can work on our products and ideas without being distracted. We managed to build up a better and better startup ecosystem in Cologne and I’m happy to be part of it and share my experiences with other founders.