The relative difficulty of ARR milestones (I just hit #1)

The first dollar is the hardest IMHO.

After over 9 months of building in public, I'm so excited to have finally hit my first dollar in recurring revenue with Dropboard! Throughout my startup career I've hit each of these milestones in annual recurring revenue, so I thought I'd rate each one in relative difficulty.

$1

As a product/dev-centric founder, this one is the hardest for me. To prep for this milestone you have to discover a compelling idea, come up with a hooky proposition, and build an MVP.

Then the validation phase begins. Finding target customers and getting first-round, honest feedback is hard. You're scheduling market interviews with anyone who'll listen, you're involving yourself in any conversation you can to learn and engage with folks in your problem space, and you're desperately looking for those early adopters who can give you critical feedback.

Getting signups is tough work, and it feels amazing when it happens, but it doesn't really mean anything until they open their wallets. At that point, you've got validation that:

• You've captured a real problem
• You've created convincing positioning around your solution
• Someone agrees with the value you've assigned in your pricing

What you don't know yet is if your product lives up to buyers' expectations.

$1K

The first $100 is a sub-milestone here that proves your first buck wasn't a fluke.

But the $1K mark is more significant because it proves that premise beyond the shadow of a doubt. It's also likely that you don't have a massively leaky churn destroying all your progress.

$10K

$10K is really tough.

Up to this point you've shown that your product solves a need for people and they're willing to pay for it. And through brute force of page views, you might be able to kludge your way passed $1,000 in annual revenue.

But what you don't know is:

• Is my product sticky enough to get continual use?
• Is my price point too low or too high?
• Are people having long-term success that might entice them to upsells?

Having a problem in any one these areas could lead to plateauing. And you're still on a razor-thin budget.

Getting to $10K is a pretty good indication that those concerns are at least starting to be addressed.

$100K

Things are getting bit easier after $10K because you've probably gained a clearer perspective on who your ideal customer is. And at this point you've most likely starting gaining some decent word of mouth from truly solving a real-world problem.

At $100K, you've also got the benefit of real, investable revenue to experiment and solve problems with.

$1M

For many bootstrappers, the million-dollar mark is the holy grail.

But it's no cakewalk getting here.

You may need to do pricing experiments. You've probably uncovered churn issues. Your core product may not go deep enough to extract the kind of value you need, pushing you into major product development.

When you get here though, you're a true, recognized player in the market, and success breeds success. You're getting more customers from referrals and marketing efforts are easier because you have a larger budget to play with and you're getting more page visits to learn from.

I hope you enjoyed this! I'm building in public with the aim of reaching that elusive, $1M annual recurring revenue milestone. No cofounders. No funding. 😬

If you liked this you can follow along each week on my YouTube channel or keep up with me at colinmakessoftware.com!