Tech startups are often characterized by a traditional narrative that features venture capital funding and hockey stick growth. However, Jeremy Clarke’s entrepreneurial journey challenges this conventional narrative.
In 2011, Jeremy founded WebMerge, a document automation software platform. When the startup was acquired eight years later by Formstack in 2019, it was valued at $100 million. Jeremy’s story is one of slow and steady growth, unwavering customer focus, and the power of startup bootstrapping.
Around 80% of startups opt for bootstrapping as their primary method of business development. Bootstrapping is a strategy for launching and scaling a company that doesn’t rely on external investments or funding. Instead, it entails the entrepreneur using their own savings and deploying inventive financial tactics to sustain and grow their business, making it a self-reliant and self-sufficient journey to success.
In his global keynote for Founders Network on January 9, 2024, Jeremy shared insights on startup bootstrapping and how he grew WebMerge to $2 million ARR before even making his first hire. In a fireside chat with FN Founder and CEO Kevin Holmes, he detailed why he had a laser focus on customers and how prioritizing their needs enabled him to scale.
WebMerge’s inception was rooted in a straightforward yet crucial problem – automating the generation of contracts, applications, and proposals in PDF and Word formats. Jeremy recognized a gap in the market and leveraged this insight to jumpstart his business. With laser focus on addressing this problem, WebMerge quickly gained traction, serving over 3,000 customers across 80 countries.
But achieving that success was a long and arduous process. Unlike venture-backed startups, bootstrapped startups have an average growth rate of 20% per year.
“Being a bootstrap founder is less glamorous. You have to hustle a lot more and to get the same amount of attention,” Jeremy says. “For most bootstrapped startups it’s slow and steady growth. There’s no huge hockey stick. I think we did $30,000 the first year, $120,000 the next year. It’s not this huge growth curve.”
Startup bootstrapping means doing more with less. In a National Small Business Association survey, 59% of bootstrapped companies said they had less than $25,000 in capital on hand. But research indicates that despite the challenges bootstrap founders face, their startups are better set up for success. Approximately 90% of startup failures come from companies that have not bootstrapped.
“You have to be really lean,” Jeremy says. “It was just me. I handled all customer support, all product development, all everything. And so I tried to automate as much as I could to stay on top of things, but also be really attentive to customers. They guided where I went with the product.”
Advice for Founders
For other founders bootstrapping a company, Jeremy recommends keeping your day job as long as possible. Having a day job provides a financial cushion during the early, slow-growth stages of a business. Not only did his full time job help supplement his income; it also made being a founder feel yes lonely.
“When you’re alone bootstrapping a company by yourself, it can get lonely. You just need to bounce ideas off people,” Jeremy says. “ I recommend that people in the bootstrapping phase, run their business as a side gig, essentially, until they’re able to support themselves. The people you’re selling to, they are in no rush to buy your product. They are in no rush to give you their credit card today. They’re going to take a week, two weeks, a month to process. It might take two years to really gain traction. I think having a job gives you that runway to be able to last through those early low growth timeframes.”