"How we Bootstrapped Our SaaS Startup to Ramen Profitability"
Or as they called it in the 80s:
"How we Started a business"
Or as they called it in the 80s:
"How we Started a business"
I'm all for calling out buzzwords, but each word here seems to do a decent job of communicating a lot more than "How we started a business."
https://www.jpmorganchase.com/corporate/About-JPMC/historica...
The 1980s may have been a time when some borrowers had easier time getting credit at all, but it wasn't a time of “cheap cash”.
The idea of bootstrapping is only valid in recent 1-2 decades because it is now possible to start businesses without a chunk of cash, thus "bootstrapping".
I'm not convinced bootstrapping existing under another name in the 80s.
For the pedants, I'm not saying it was impossible to start a business in the 80s and 90s without cash, just saying that such a path was rare enough to not have a common name such as "bootstrapping".
In fact, prior to Amazon ec2, even Internet businesses required typically the cash to buy/house a server in a data centre which was often thousands of dollars, and even that was considered incredibly cheap for access to a global market compared to what it used to cost prior to the web.
If anything it's probably harder to get started today, your competition is worldwide, not just local and customer expect more than a text based terminal app.
You seem to imply that shared servers (shell or web) did not exist prior to AWS?
I do recall that there was typically shared PHP hosting.
ec-2 changed the game by making complete control over your own server simple, cheap, software controlled.
Shared hosting existing before but the ec2 formula was the one that worked.
As far as I know EC2 introduced auto scaling, load balancing and spinning up instances in such a lightweight way. Not a revolution but still nice and necessary steps.
If you built a website 20 years ago and it exploded in traffic, shared hosting without easy scaling would not be a solution. You would have to plan your growth and pre-order shared instances. Thus making your business cash dependent again without proven growth.
You could host a reasonably successful web site on a relatively low end server (say, a Sparc 10) off a T1 line (1.5 megabits) and serve a ton of users. They all had crappy connections and were used to waiting.
Google ran for many years on piles of commodity boards and they were expanding pretty fast...
The amount of marketing hype around cloud services is insane because all the big tech companies have a vested interest in your renting their platforms. It doesn't allow you to do anything you couldn't 15 years ago, just makes it easy.
Plus, the level of resources for configuring EC2-like servers, and Heroku-esque preconfigured servers reduce the barrier to entry pretty significantly.
AWS was the first place where a joe-developer could dial up a machine to use without a heavy sales process and involving purchasing, legal etc.
This all played out slowly though : at first AWS was only used for things like running tests, replacing developer desktop hosted VMWare. It took a few years to get to the point where it was used in the way we are familiar with today.
fwiw when AWS (EC2 really) started, Internet/Web services weren't even typically run on x86 hardware or Linux. Solaris, AIX, HPUX et al ruled.
AWS didn't launch until 2006, which was actually pretty late in the internet game. x86 Linux hosting was ubiquitous then. If you're talking Solaris, AIX, and HPUX, you're remembering the late 90's...
And prior to EC2 a lot of people either just rented servers (in someone elses colo), or got a leased line and hosted servers in their office. Both were very, very common in the 90's.
Or by working a job on the side. I think the "definition" is rather to not take outside capital.
From a bootstrap perspective, there was little cost difference at the beginning. The main difference was in the middle stage: scaling. After a bit off success it was still possible and practical to scale until you outgrew the ability of a single dedicated server to handle a specific task. Until then, you could grow and scale with little difficulty from a shared server, then dedicated, then shunting functionality to individual dedicated servers, e.g., web sever, database, etc. Yes these cost money, but ig you were bootstrapping then you only got to that point after you'd passed through the nearly free-per-month shared stage and, abd long after revenue flow began.
Scaling beyond that was absolutely way more difficult in terms of tech knowledge and cost. Modern AWS makes that scaling much easier, but the pre-ramen profitable stage was not much if any more expensive.
The key cost that was then and still is the biggest, in my opinion, is opportunity cost. A hundred bucks a month then or now, with or without adjustment for inflation, is nothing compared to the opportunity cost.
As a more general rebuttal of the sentimemt expressed, I'd offer up "started in my garage" businesses of all sorts, then and now. Those whose primary initial input is never cash but sweat equity and grinding out the details and execution of an idea.
There was pretty cheap competitive web hosting available from 2000+, not just 2006 when ec2 was released.
In Germany it is quite common to start that way even today. Many startup folks consider this old fashioned. But it is the most engaging and valuable way to start a companies. Because then your about skills and providing real value and not for that fast money with a fast exit. You don't want an exit at all. 3 friends of mine started in the 90s a tools and services companies for the automotive world. They are now all 3 retired and moved to company to a trust fund so that no other company can ever own that, so that this company can exists for ever. Compared to the US. Remember DEC, HP, SUN, Silicon Graphics, and alike? All companies got sold at on time to another and basically disappeared with that.
Yes, "bootstrapping" is the old fashioned way in the old fashioned world to start companies.
The title is a bit buzzword-laden, and GP is calling that out.
Said differently..
For some, largely on the funded side, everyone's a statistic, and after generally "going hard", they inevitably "go home" because they're told there's no more money from investors, and not enough paying customers.
On the self-funded / lean / boot-strapped / ramen profitable side, you get to earn your keep to stay in business so no one can tell you to go home except your customers who stop paying you.