We saw it advertised as 90% off on a startup platform we're part of, applied, and we were told since we're a bootstrapped business and haven't raised any money, we can only get 30% off.
It left a sour taste in my mouth.
If you're bootstrapping a business counting every penny of your own money, you're at disadvantage, but if you raised $2 million, we're happy to save some of your VC money!
¯\_(ツ)_/¯
It was absolutely ridiculous. I went from being eager to use their product to vowing never to recommend it again. They were just so condescending during the entire process too.
They aren't very interested in taking VC-funded companies money because it will be like taking something out of your right pocket and putting it into the left one - it doesn't do anything to prevent the bubble from popping.
External money (from outside the bubble) however is very important since it's the only thing that will stave off the eventual cascading failure of the industry as all these unsustainable companies (who mostly just pass their VC money back & forth) start falling like dominoes.
"Look at our hockeystick! We got customers equivalent to a million MRR!" "Equivalent? How much are they actually paying?" "...nothing, they're all in our VC batch. But hey, we also get service X for free in return!"
It makes a lot of sense to offer a service for free (as a customer acquisition tactic) to a VC funded company because the 2 options are either they go bankrupt or they can be charged 100 times more revenue in 2 years.
On the other hand what is the point of subsidising a bootstrapped business potentially forever?
90% off year 1
50% off year 2
25% off ongoing
HubSpot charges ~$1,200 p/m for their professional Marketing & Sales plans.
I assume 25% off almost $15k annual with pretty much zero CAC is not far off from what HubSpot sales would offer themselves to a multi-year deal.
My experience with bootstrapped companies is that they are just as subject to pressure to grow as startups, and probably have a higher success rate.
Atlassian, Github, Mailchimp and Shopify are all companies that initially started as bootstrapped companies and, in my mind, stand out as some of the most sustainably successful startups of recent history.
Parent's argument is that bootstrapped companies are dramatically less likely to ever grow and that only VC backed early stage companies are, therefore it makes no economic sense to provide discounts to bootstrapped early stage companies.
My point is that I don't believe that this holds out in the data that expected long term value of a bootstrapped company is significantly lower than a VC invested on.
Personally, I find there is ample evidence that "VCs largely are just handing money around to each other to give the illusion of growth" is a solid hypothesis.
It basically means VC money is a get out of jail free card for a lot of early potential mistakes and miscalculations you can make while working out how much it will cost you to build your business on the back of AWS and how that affects your own pricing model… and the 100x ratio is just rubbing phosphorus into the wound and what elevates this to just insulting to me, it’s one thing to have a 50% or 100% difference in the amount of discount you get (like the already stated example where the VC funds mean you get 90% off, and the bootstrapped customer gets only 30%, that’s a 200% greater discount)
With the 100x on the free AWS credits that’s the equivalent of 10000% discount to the VC funded customer… and when I know that bullshit half baked ideas by people with good networking connections in California are getting a discount like that while I’m working hard to build some sort of legitimate business with my own money… it just feels like Amazon saying “fuck you we don’t want your real business we just want these idiots with their fake business”… it’s not a good vibe to give off.