$4M/yr to Solve the Chicken-and-Egg Problem · Start a Fund Without $$$

(from the latest issue of the Indie Hackers newsletter)

Channing here. Happy November! 2020's got just two months of runway left before it goes out of business. But with election eve upon us in the states, and with coronavirus shutdowns happening all over again in Europe, we can be sure the year won't go out without a sizzling finale.

Here's what I've got for you in today's post:

How a bootstrapper has grown to over $330,000/mo by solving an infamous business paradox.
In the news: A no-code competition just got announced. Stripe addresses climate change with their latest release. How the non-rich can now start venture funds.
Are you only launching on Product Hunt? You're probably missing out on many new users. Learn about a second major launch platform.
In 2020, the best marketing happens via conversations in the wild, not on landing pages. Learn the gift of gab from a marketing expert.

Special thanks to Jonathan Williamson, Darko Gjorgjievski, and Harry Dry for contributing to this piece. Want to contribute a writeup of your own? Check out this doc for an idea of what I'm looking for.

🐔 $4M a Year to Solve the Chicken-and-Egg Problem

Solve people's problems, get paid. That's what business boils down to. The costlier the problem, the higher the pay. Trouble is, the products that solve some of the costliest problems are the trickiest to build.

Jonathan Williamson is building one of these products. And successfully:

We are grossing an average of $336,000 a month with an operating margin of 16% and are profitable.

Jonathan's company Blender Market is a two-sided marketplace for artists and developers to sell their add-ons for Blender, one of the most popular 3D creation suites.

Two-sided marketplaces are notoriously difficult to get off the ground because of the chicken-or-egg dilemma. On the one side, you have your buyers. On the other, your sellers. Without sellers, there's no supply to attract new buyers. But without buyers, there's no demand to attract new sellers. So how do you even get started?

For Jonathan, the first step was to validate the demand side. Blender is an open-source platform, and developers regularly build and release free plugins and other resources for the community.

But this lack of compensation has some downsides:

The vast majority of add-ons for Blender were released for free to the community by the developer, which was great, but invariably the developer would get busy or lose interest, and the add-on would break.

So the question was simple: Was there an appetite for paid Blender products that were better maintained by their developers?

To find out, Jonathan and his co-founder built their own add-on and gave it a price tag of $31.50. At the time, there had only ever been one or two commercial add-ons for Blender.

The result?

Within a week we had sold several hundred copies and knew we were onto something… Over the next year we released a second product and began designing and building the first version of Blender Market, which we launched in June 2014.

Bingo. Jonathan had validated the demand side for his marketplace. And where there's market demand, there's market supply.

Of course, he was still facing the chicken-and-egg problem. And many of the strategies he would use to overcome the dilemma would lead not only to incremental growth, but to full-blown stair steps:

Prior to that point we were grossing about $16,000 a month. Within a few months we jumped to $50,000 a month. The combination… created the traction we needed to attract new sellers and buyers.

Read Jonathan's full interview to learn about these strategies, along with his other learnings from nearly ten years of bootstrapping. —Channing

📰 In the News

💸 It's becoming easier for people who aren't rich to start venture funds. Get the breakdown here.

🛠 No-code challenge! You've got till the end of November to build a project using Bubble. Prizes include cash and an iPad Air.

🌎 Stripe's latest climate feature lets you direct a fraction of your revenue to fund carbon removal with just a few clicks.

📧 Insider Inc. just bought a majority stake in the popular business newsletter Morning Brew.

🐦 Hiten Shah started a never-ending Twitter thread of the best online resources for early-stage startups.

🏛 Remember when Trump banned TikTok? Courts are now ruling against his executive order.

📊 Weekly Acquisition Channel: BetaList

I've analyzed all 486 Indie Hackers interviews and identified 34 acquisition channels that work consistently for founders (see Zero to Users for more details). Today, I'll be reviewing an acquisition channel that was mentioned across 15 interviews: BetaList.

Like the name says, BetaList is a directory focusing on businesses that are about to launch a private beta. This can be great if you only have a landing page and want to validate demand, like NoCode ($400/mo):

Initially, as I was creating NoCode I built a quick landing page with an email capture form and a mocked up screenshot of the homepage using Canva.

I then managed to get featured on BetaList where I got about 35 signups. I later used those interested early adopters to test my initial prototypes of the site and get feedback on some of my ideas. This approach proved incredibly valuable information and helped validate some of my early assumptions.

This was my butt ugly landing page in 2016:

BetaList can be also useful if you have an initial MVP. This was the case for Standuply ($25k/mo), a Slack bot for team standup meetings:

It took us a couple months to build the first MVP which we launched on BetaList. In a few days, we got 300 teams signed up, having a landing page only.

BetaList and Product Hunt are the "big two" product launch websites and founders often use them in tandem when launching. One of those people is Ross Rejek, the founder of AppToolkit.io ($1k/mo), a set of tools for mobile app creators. When asked which strategies he used to attract users and grow, here's what he said:

We also submitted to BetaList and a few other product sites, looking for early users of the SDK before releasing it to everyone else. But Product Hunt and BetaList are the two big ones in the early adopter field.

Setting up a simple "waiting list" page and getting to a 6-figure MRR? Sounds too good to be true? Not for Everhour (making $120,000/mo), which got started this way:

Taking the easy route, we created a very simple "coming soon" page. When the page was ready, we submitted it to Beta List and a couple more directories. This gave us roughly 1,500-2000 early adopters right after launch.

Don't underestimate the power of a simple "coming soon" page. Talk to you next week! —Darko Gjorgjievski

🧠 Harry's Growth Tip

Marketing is a conversation:

Screenshot of Harry Dry doing marketing by having a helpful conversation.

Go here for more more short, sweet, practical marketing tips. —Harry Dry

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