Today, I’m talking to Moritz Dausinger, a serial indie hacker with several exits under his belt. Moritz most recently pivoted his software business Refiner after 18 months of trying to figure out a way forward. Well, now he’s found it. We will chat about figuring out how to structure sales, how and who to hire, and if he wants to sell this business again, for a third time.
Arvid Kahl 0:00
Welcome to The Bootstrapped Founder. Today, I’m talking to Moritz Dausinger, a serial indie hacker with several exits under his belt. Moritz most recently pivoted his software business refiner after 18 months of trying to figure out a way forward. Well, now he’s founded. We will chat about figuring out how to structure sales, how and who to hire, and if he really wants to sell this business again for a third time. And before we get to our conversation about all of this, let me introduce the sponsor of today’s episode. Imagine this: you’re a founder who’s built a solid SaaS product, you acquired customers, and you’re generating consistent monthly revenue. The problem is, you’re not growing, for whatever reason, lack of focus, lack of skill, or just plain lack of interest and you feel stuck. What should you do? Well, the story that I would like to hear is that you buckle down and somehow re ignited the fire, getting past yourself and the cliches and you started working on your business rather than just in the business. You start building an audience and you move out of your comfort zone and you do sales and marketing and all the things you don’t like doing. And in six months, you’ve tripled your revenue. The reality isn’t that simple. Situations may be different for every founder facing this particular crossroad. And too many times, the story ends up being one of inaction and stagnation until your business becomes less valuable or worse, worthless. If you find yourself here, well your story is likely headed down a similar road. I offer you a third option, consider selling your business on acquire.com. Capitalizing on the value of your time is a smart move. Acquire.com is free to list and they’ve helped hundreds of founders already. Go to acquire.com and see if this is for you, if this is the right option for you at this time. All right, here is Moritz Dausinger.
Moritz, I really have to thank you not just for being on this podcast today, but for having been on podcasts in the past in August of 2017. And this is six years ago, which is crazy. You went on the Indie Hackers podcast and that was episode 24. It was barely a couple months old at that time. You talked about building and selling mail parser. And I remember this podcast episode so vividly. I have like a visual memory of this. I was traveling through Berlin, just coming home from work in the espon right there. And I heard you mentioned that you sold your business to a private equity company. And it blew my mind that day. I just didn’t know, I didn’t know that was possible. And you also mentioned the name of that company, which is something I will never forget because we ended up selling our SaaS business to the same private equity company two years later and in a way that makes you responsible for our exit. So I just wanted to extend a very big thank you to you and just point out how powerful it can be to share your story in public like you did on that podcast. So I’m really, really glad you’re here today as well. So thank you so much for that.
Moritz Dausinger 3:04
Man, you can’t imagine how happy I am to hearing this. And now look at us, what? Six years later? Seven years later?
Arvid Kahl 3:13
Yeah, almost seven
Moritz Dausinger 3:14
And I remember when I got asked to speak on the indie hackers podcast, I wasn’t hesitating. It was quite new. I knew the website I bet. Well, it was kind of a niche experience back then this whole indie hackers thing. And yeah, lucky. I did. I think there’s so many also from my career and my story after coming afterward. So many good things came from this one podcast, which which was, I think, actually my first one ever. So now lucky me into the right thing, right?
Arvid Kahl 3:49
That’s right. That’s a that’s a great start to start podcasting, probably in what is still the best podcast in the space, right, at least the most renowned podcasts that I could think of when I think about indie hacking. So are you still an indie hacker? Do you still consider yourself an indie hacker?
Moritz Dausinger 4:05
Oh, well, well, I think I stopped putting myself a label on quite a long time ago. Because it really depends with who I’m talking to. Like, for example, if I would talk to my parents, I would say I’m middle stand it on the name like Sherman. I don’t know small business IT company. So I’m not a startup? I’m not. I would Yeah, I would say it’s a small IT company. We are several people. So I’m not really an indie hacker, but I’m the solo founder. At the same time, it’s mostly self finance. So yeah, you could say you could also say I’m just a 40 Something guy who has an IT company and building software, right?
Arvid Kahl 4:55
I guess that’s that’s what most Germans would be much more easily You can attract it to as a concept they would understand like, you know, the middle middle student, that’s what we call it right? middle middle class, small business thing. That is something relatable to most people. It is interesting that you mentioned this, like you said, you’re having a team. So you’re not an indie hacker anymore. That I mean, that’s not exactly what you said. But it’s kind of, you know, a sentiment that once you grow your business to a certain size, it feels less in the less independent, it still might be financially, right, you might might still have most of your funds coming actually from your customers. But there is some dependency in the business, either for your team members, so they have a job like a stable income, or to customers who really rely on you. Now there is a dependency in there. That is something that I don’t hear many people talk about, like, what’s that dependency, that newfound dependency in a previously independent business is let’s, let’s maybe talk about what you’re currently building, or maybe, okay, let’s start with that. Because we can talk about the things you built in the past afterwards. We don’t need to be chronologically correct. But you’re currently working on refiner. And I think refiner has an amazing long and I guess, order yes and stressful story. Like to hear about it. How did that go? Like after selling your first few businesses? You started refining? What? What made you jump into that again?
Moritz Dausinger 6:18
Yeah. So when I sold my last company, Doc parser, I had an agreement with the buyer, where I would stay on for a couple of what was one and a half years actually. And I would readily transition out of the company. So his interest was basically as long as things are going well, I’m getting, I’m going to work less and less fine for me. However, back then, having a wife having kids means you’re not free to go anywhere in the world. So you kind of stuck where you are in the office still. And so I thought why not just build the next one, right? I mean, I need to do something. And so when I was running doc parser, I had this need to qualify my signups like they would create an account. I didn’t want to have too many questions while they are creating their accounts. I wanted to them to experience the software right away. But I still had some questions I would have to have answered. And so what I did, I was displaying an in app survey, five minutes after they created an account, asking two simple questions. Just for context like dog parsers document processing software. So I was asking the question, how many documents are you processing per month? What type of documents that you want to process? And having the answer of those two, those two questions allowed me first of all, making some kind of axial and charts and whatever to figure out who my customers are. And secondly, I could identify bigger accounts, I could say, oh, this one looks really interesting. I want to talk with this guy, I want to make sure that they are having a good experience. And so I like I’d worked really well. I liked the idea. I didn’t find find the product doing that. So back then I was basically hard coding all this. And so I thought this would be my next winter. I started coding this very simple idea. And well, one and a half years later, I found myself with an enormously complex enterprise IT kind of lead qualification solution. Nobody was asking for literally nobody was asking. So even though I created a couple of companies before I did, pretty classic beginner mistake. And you know, the issue there was I built a first of all the software nobody was asking for Secondly, a software where you would need to have some kind of enterprise sales process, something I really don’t like doing, and so on and so on. So I felt like okay, I’m kind of stuck somewhere. Let’s go back. Let’s do a kind of Piero and go back to this initial simple idea of showing surveys inside an app. And this is what basically refiners today. So throw away like 90%, the code launched one week before lockdown. COVID lockdown in France, perfect timing. Bad. Well give me some time to like, I don’t know, like, I think this whole first COVID months. It was good. That software was quite, you know, there was not much going on. So I mean, there were other stuff to take care of, for example, the kits and then after, in total, I would say two years after starting this new project. I was at the point where I had significant Mr. of, I don’t know that was like one or $2,000 $1,000 per month which was for me to sign okay. I And finally, after two years I did it. I had another software, which was kind of working well, yeah, that’s the beginning of this refinery story.
Arvid Kahl 10:11
Thanks for sharing this thanks also for just being honest, but both to yourself. And to me and everybody listening about, you know, like, even even if you did a couple things before and you’re successful doesn’t mean you cannot fall into same traps again, I do make the same mistakes. And it’s probably I don’t know, maybe, maybe I just want to ask you this. Did you feel like you knew better, you know, after having built two businesses that you knew exactly what your customers need? And then you build it? Was that it? Some kind of hubris? Some kind of oh, yeah, I know better than everybody else.
Moritz Dausinger 10:42
Yeah. Okay. So like, I mean, at that time, on top pass, it was a third product I had built and which became big. And so I was like, Okay, I found my model. I like building software. I like the early days. So I’m just going to continue building one project after the other SaaS, product, B2B SaaS product, because I figured it all out, I know it all. And, ya know, what helps you what, like the experience I have right now definitely helps in the day to day operations. It helps with a lot, a lot of things I wouldn’t neglected neglected. But it doesn’t prevent you from making stupid mistakes, it doesn’t prevent you from not finding the MVP you’re looking for. And it really reminded me that going from zero to something is just so hard, and you need to have luck. And you need to have good timing, and you need to exert a lot of things checked to be there. Once you have something in your hand, which I’ve mentioned before, like one to $2,000 Mr. Then I think it’s much much more about execution. But before that, it’s some kind of like magic. Where are you? Yeah. Well, some everybody that’s different. But
Arvid Kahl 12:11
yeah, that’s that’s an interesting point. Once you have something, not only is it is it just about execution at that point, but it’s never just about anything, right? If they you know, entrepreneurship is everything at the same time. But if you have something, not only can you actually put more energy into what you know, works, we can also show it to other people and make other people interested. And I think you did that, right. Because for your first products, you only really put your own money into this. You just use your own funds. And that was it. But for refiner, you went a different route. Do you want to explain a little bit what you did once you reach that point? And MRR?
Moritz Dausinger 12:46
Yes. Yeah, just to to follow up on this. The first one, like, I feel like once you have something, then that also means yeah, as you mentioned, you can show it to somebody and you have, most importantly, customers. Yeah. And once you have, once you have 10 customers or 50 customers, I feel like the shop changes, the job is then to listen to what they’re saying, having your own vision as well, and trying to match those two things. And so I’m definitely not the guy saying whatever the customer says, I’m going to implement it. It’s more like whatever they say, and it fits my products, energy, it’s maybe already on my to do list, then I’m doing it right. So this is why I think it’s getting not easier, but different once you have to know 50 customers. And to follow up on your point about what I did once I went to the one to 2k Mr. At that time, I already had like, nearly two years of own money spending and no salary put into this company. And I felt like I have no two choices. Either I do that, again, like another year without a salary on maybe two years without a salary. Or maybe I can get a little bit of extra outside funding inside his company. And you know, like, the reason why I never raised before was because I didn’t really like venture capital path. You are set on once you raise with a VC which means seed round and series A Series B and you basically are promising everybody, I’m going to build a really, really big company and good for people who want to do that. I didn’t want to do that. So I’d never actually considered the VC path something which would fit to me. But luckily, during the last year, there were a couple of funds coming up which are what they call themself bootstrapper friendly, so you can get an investment They definitely are funds. So they, they want to have a return on their investment. But they’re not necessarily setting you up on the path of a typical VC startup. And so that made it compatible to me. And so I raised some money with com company fund. And I actually really, I can fool hobbies, I don’t really, I don’t really regret it, because it allowed me to just really accelerate a little bit like hiring freelancers for marketing, and also developer freelancer and just go faster. And with not many strings attached, they are for sure strings attached, you are giving away a part of your company, right. And then the moment you want to sell your company, it’s also you need to give money back to them. So you’re kind of signing up that this is becoming a bigger thing than just like a project you would sell for, let’s say 50 or 100k. On micro acquire it, you’re kind of signing up that you want to build a bigger thing that that’s the strings attached to it. Yeah, but apart from that, I was really quite happy about that decision. Also, because, you know, as I mentioned before, I already put in a lot of own money. And I felt like if I continue doing that, it’s just becoming more and more difficult to make really objective decisions. Because it’s still a business, right? It’s not it’s, it’s a business.
Arvid Kahl 16:40
That’s what I was, that’s, that’s what I’m super interested in. Because you’re saying, like you with that money, you can make objective decisions. And without it, they would have been more, I don’t know, fear driven, I guess, which is interesting. Because most people, whenever they talk about raising money, they say, Well, now I need to make different decisions for my investors. But that’s where the bootstrapper compatibility comes in. Can you kind of explain, like, the kinds of decisions that you didn’t want to make like to kind of, you know, all your money is in there? And now I need to, you know, protect it. What was that? What was driving you at that point?
Moritz Dausinger 17:13
Yeah, it was more like, putting too much on my of my own wealth into one project. And also, you know, like that, I think it’s really interesting to ask the question, when are you racing, what wouldn’t work for me, for example, is raising money on an idea, because then I would be super nervous, like, oh, man, this guy just gave me money. And now I need to really need to deliver and need to build something that is working. The moment I raised money from Tyler from company fund, there was already a software product, which was working, right, it was not profitable, but it was working. And there was confident enough, giving my previous experiences with NASA SaaS space, that I thought, okay, if I can bring it to KMR, I probably going to be able to bring it to 20 or more. And so yeah, that gave me confidence to say, From now on, I can do that, but I prefer doing it with outside money than my own money. So okay,
Arvid Kahl 18:19
that’s, that is exactly what I love about this bootstrapper compatible model, like, first of all, they are compatible in terms of they don’t really interfere with your decision making, which is exactly what you need at that point, right. as a, as a solo founder, or as an indie founder, you want to make your independent choices, that’s, that’s what you signed up for. And the whole journey, that’s what you want. And they only really take you on, if you’ve proven that the thing you’re doing works, right. Like if you look at tiny seed, or if you look at the com company fund or whatever other players in the field exists, they all want you to prove that you can have customers, they need you to already have customers before they give you money, which is also complete opposite of the VC idea. They want you to just you know, have a really disruptive idea, and maybe some kind of semblance of a product, if at all, you know, like some products don’t even exist, but our market it you know, and in the VC space, not that there’s anything wrong with trying to disrupt the world. It’s also interesting, right as a business approach, but I think in terms of what we are doing as people who want to build, and I mean, it’s in the best sense of the word, a lifestyle business, a business that allows us to live the way we want to live. Having somebody who can support us, like that is great. And I I have to I have to mention it. I have a podcast with Tyler, where we’re building stuff together. So obviously, I’m not gonna badmouth the idea of the comm company fund here. Also being an investor in the fund. And also knowing that both you and me and Tyler we all sold our businesses to the same private equity company. It’s a big family, right like and that’s that’s what I kind of love about the fund. Like it was initially called earnest capital when he started and then he renamed it to the Kong company Fund, which I think is a much better name. It comes from a place where people really understand what the kind of business stead we want to build is about right, both Tyler and the mentors and the investors in the fund. We all are effectively solopreneur or really small indie business owners or have been because we sold our businesses, right. So we know exactly what this field is about. And I’m really happy you got some, some funding for refiner, because apparently it helped you pretty well, right? Like, I was looking pretty good.
Moritz Dausinger 20:24
It did. And you know, like, I think, I can’t really remember the, I think you can put it like that, like, it’s really about math, the count company fund on similar funds, assume that eight out of 10 investments will work out. And which is the opposite to the VC model, where it’s basically two out of 10 will work out and the rest, maybe not. And I’m not saying this one is better, this one is better, I can just say this one is more compatible with me as more words as somebody who likes building software products, and like, organizing my days, the way I want to and so yeah, I’m happy that I took that. And, like, really, what it really did is that I switched a little bit my mindset, you know, I was hiring, was able to hire freelancers in advance, like, you know, like, you’re not profitable yet. But you can burn more money. This is typical, three points, and all the startups have that they can just burn, burn, burn money, and I held it. It’s really sweet. It’s really good. But you you Yeah, after half a year or one year, you’re like, oh, wow, I already spent half of it what? So you need to be careful with it. But it did really help in terms of product development, and in and marketing because SEO like content is one of the big drivers for a refiner. And it’s a long term game, you know, like, you need to invest a long time period of time. It’s not something where you can just put down like 500 euros, and the next week, you’re going to see results. You need to start early. And you need to do it good. And it will cost some money. And a lot of this money went into that. And so yeah, that wouldn’t have happened without investment. Yeah.
Arvid Kahl 22:24
Well, that’s good to know. I’m reminded, as you’re talking about, like, who you hired and the freelancers that are working for you, I reminded a talk that Rob walling was just giving at MicroConf in Denver a couple months ago, he talks about the first hires that every SaaS B2B SaaS business should be doing. And I do wonder, in your particular case, what is the order of people that you hired in, in the sense of that you hired for part time or full time or even just projects? What order of jobs did you need to hire out?
Moritz Dausinger 22:57
Yeah. So I don’t want to make a rule out of that, and I exploring things as I go. But I can just say what I did. For the early iteration of the early product, I hired website designer to make it look good. So that I have a nice website, I did the product myself entirely. So I was lucky enough that I could code and build some kind of UI, which is not too crazy ugly. But you need to see that my product has an visual part of it. It’s the surveys. And these ones were also designed by a designer. So I was able to get a good looking product, which was kind of important for for my business. Next thing was marketing. Like, as I said, the SEO person. Its power from smashing copy, which I really recommend. And after that, it was a developer, another marketing person. Today, we having also that mobile surveys of app to mobile developers, a salesperson in Paris. She’s doing basically following up and building up a process around bigger customers so that they because they have special needs to get on boarded. And who else that’s about it. Yeah.
Arvid Kahl 24:29
That just that list alone raises so many questions for me, but I’m trying to constrain myself to one at a time. First one, how was it hard to hire developers for you? Because I felt that so strongly to hire somebody that was supposed to do my work as good as I did it. How was that for you?
Moritz Dausinger 24:47
Yeah, no, like, really, really difficult when you’re a technical founder. And so I was super lucky to find Ben. He’s also active on Twitter. Digital trouble is his handle He was over, he is a senior person I can trust. Nevertheless, you need to do a lot of specs, you need to really write that down into detail because nobody knows your product better than you do. And secondly, there are parts on the products, I think are good for outsourcing. And then there are other parts where I’m basically like, okay, no, I’m the best fit for this particular part of the product. If one day, I’m in the position to hire a full time employee who is just doing that, for sure you’re going to take over, but for right for right now, these are the parts I’m handling. And these are parts, for example, in our case, then coded the entire dashboard section where you could build your own custom reporting dashboards, like adding a chart and resizing and removing, it was really a nice project apart, which didn’t interfere with all the rest of the software. So that was basically my approach. Or they would say, No, I can’t go outsource all of it. But there are definitely still things I can outsource. And even then it’s even then if you have a really good person, it’s so difficult to have the coding standards, right? To make it so that if I mean, for me, it’s really important that the code base is kind of uniform, you know, like, if one day somebody else is gonna take over, they will find your way because everything is done the same way, which I value more than the perfect way, you know, it might not be perfect, but at least it’s a way for you. So there’s a system to it. And all this kind of stuff is really getting more more difficult, more, the more people you’re putting on the project. And yeah, so that’s the answer of your first question. I think some things you can outsource some things I’m not eager to.
Arvid Kahl 26:54
Man, that is, that’s a great answer, like to know what you need to still do. And to to also let go of the things that I bet you could do it because you have to until you hire somebody for it. So how much of your day do you still spend coding compared to the all the other things you have to do as a founder,
Moritz Dausinger 27:13
right now, close to zero, because and I’m saying this with a sad face. For those who are not watching, but listening, now I really I really like holding like a, but I know that for the business, I am spending a lot of time onboarding new customers, I’m spending a lot of time doing admin stuff like paying bills and paying me are paying contractors paying moving money around and and like, for example, also with the bigger accounts, there’s also always legal questions, and there’s just so much stuff to do. So no, unfortunately, I’m not coding much these days. And Nick, one of the next things on my list would be also to hire somebody for exactly this the technical support, I call it like, it’s not just supporting the way of, Oh, where do I change my password, it’s more like a customer. So customer success person who really takes the new customer by their hand and make sure that they get the most of the solution. And I think this will free up a lot of time. Once I find the right person to do so. Because yeah, right now, it’s really like, less fun than before. Let’s say like, before, there was a lot of coding and new features and whatever. And right now it’s more like showing up every day and getting the stuff moving. It’s part of the game, right?
Arvid Kahl 28:51
You can’t run a business without operations, right? You still need to make thing make things happen. But I was talking to Tyler about this on our podcast, he was kind of bringing it up because he has been talking to a lot of founders, obviously in the fund. And he heard from a lot of them that they just want to be contributors to their own projects, they still want to contribute. They want to be an individual contributor to the codebase to the actual product, and often they can’t really find it. So find the time to do it. Because there’s so much so much else to do. So what you’re doing right now, I think is very important to even be aware of that just because the business necessitates all this extra work, doesn’t mean that you cannot find somebody to do it for you. Right? You are not the only person who can. So I’m glad you are you’re already thinking through how you can get that work, offloaded to somebody else so you can be best at what you’re at, which seems to be coding at least.
Moritz Dausinger 29:41
Yeah. And I mean, I think it’s a real real issue and what we’ve been probably it’s so rare that you find somebody who’s good in the beginning of building a company where you need to do well you need to contribute, and then he kind of switches to Like the brothers of stripe, they are coders. And then there’s they switched at a certain point into conquering the world. Like, I mean, you don’t do that by continuing coding, I guess you do that by hiring the right people having the right strategy and so on. And honestly, it’s, I mean, maybe sounds a little bit self limiting, but I’m, I’m kind of feeling good in this early stage world where I’m still contributing a lot. And I’m curious how far we’re gonna go, this time, we’ll be finer. But um, it’s not something I’m feeling pulled towards to say, oh, I really want to be managing 100 People in two years, it’s really not something I’m having my hands on. I’m waking up in the morning, it’s more like, Oh, I think we should probably develop this. And that because I feel like that would be a good fit for the product. I’m more in this world still. Again, maybe we talk in five years, and then I’m telling you a different story. But right now today, I’m on this mindset that I am showing building products and companies. And let’s see how big we are growing. But let’s see about that. It does
Arvid Kahl 31:17
remind me not about like five years in the future, because who knows what’s gonna happen then. But it does remind me of five years in the past when I was listening to you on the 24th episode of indie hackers, and you know, the, the mentality you had back then kinda sounds like the mentality you have today. You want to build interesting stuff. And you want to grow it to a point where you still enjoy building it, right? So maybe let’s let’s talk about male parser. And Doc parser. You You did sell them at some point you did get acquired. I do wonder why that is because you know, like, we all either we want to sell, or we want to build something for life. Can you explain to me maybe like the process of how you figured out that you can and wanted to sell a business in the first place?
Moritz Dausinger 32:00
Yeah. So when I started building, may parser, it was meant to be a fun side project, were actually really not having any ambition there. I was working for startups studio. And Paris, a very well known startups, we’re really having the best job in the world. It was it’s called the founders. It’s really where everybody wants to work. And I was able to work there. So I had a great job there. And yeah, but I still built a software, and then it kind of took its own life. And then there was this moment where I had 5k M R on the side project, and pretty much the same in the salary. And I needed to decide where is this going. And I decided I want to give it a try. I want to see how far I can go. And at that time, I also read the website, and a website about Fe International, which was a business broker. And I was like, what does this exist a business broker? Like, like a real estate broker, but somebody was just selling online estates? And I was like, super fascinated by that. And then yeah, somehow I saw, okay, what if you, if you bring it to this kind of Mr. You can sell it for this amount of money. And, well, it became interesting as an idea. And then, yeah, by discovering this whole world that this idea was a little bit set in my head to say, okay, maybe I can bring it to a point where I can sell it. And, you know, like people always referring to this life changing money or whatever. But sorry to say, but was kind of true. It allowed us to do a big down payment for an apartment, and secure myself as a entrepreneur in a way of, like, having, like, first of all, more self confidence in the dome, like, okay, apparently what I’m doing, I’m doing it correctly. Secondly, most of my apartment in one of the most expensive cities in Europe is already paid. That’s good. And if I can do it once, maybe I can do it twice. So it was really it was not the sense of now I’m buying big watches in cars and whatever. Not at all. It was just like, giving me some kind of peace of mind and security in life. And yeah, so that was really attractive as an idea and that’s why I sold a parser. And at the same time, back then I had created doc parser, which was kind of a sister product. And Kevin, the buyer of May parser. From Joseph capital, back then. Agreed that I could continue building up the parser and selling me parser to him. And it was basically win-win Basically a win win situation, because what I like to do is building up stuff. And what he likes to do is buying stuff that is already big. I told him that, let’s let him do it. So I continued working on doc parser. And once I feel it’s time is ready and go, we both agree that time is ready, I would have, he would have right of first refusal. So he is not obliged to buy but he can buy it. And this is how it happened. And so these two were basically well, two different products, two different adventures. But one story, right?
Arvid Kahl 35:47
That’s awesome. It’s nice to build that connection to the thing you’re just saying with Kevin, that is that is important, right? Because in this space, even though there’s a lot of competition among funds and private equity companies, it is nice to know somebody that you can trust. I very, very fondly remember our first interaction like around the time that we were trying to sell panda our business. And also we’re looking at chose Swift. And I did a lot of outreach to people like you and Tyler people who had sold their businesses before, just to make sure that there’s a relationship that I can actually trust with these people, because you said it life changing amounts of money. And that is scary, right? It’s scary to deal with something that is so valuable, your thing, they even get to look into it, they look into your p&l, they look into your you know, all your documents, your cash flow, and maybe even your database or something right, you, you have to be really protective. So knowing that you already have somebody you can trust, and sell this next thing to probably give you a very different, or at least a more secure feeling in building that business. Is that right?
Moritz Dausinger 36:50
Yeah, definitely. Like I mean, the first one I sold through Fe International. Because of that, because I didn’t know anyone. I mean, yeah, you could I could have probably send out an email or Twitter tweet, I want to sell this thing, give me give me your offers. But as you said, You did so it’s so scary, you’re scary, you’re scared to mess it up. And you’re scared to have this once in a life opportunity to sell something valuable. And you might end up with somebody who tells you the giving you a super high price and whatever. But in the end, it’s just gonna go really sideways, and then you’re having a lot of trouble. And this is why I worked with EF International in the beginning. And then on the second one, I already knew Kevin knew he’s a stand up guy and his word and virtual handshake, if we didn’t do the handshake really is worth as I don’t know how to say it’s worth something a lot. Yeah, I have, you know, like, just a funny story. He’s actually in Paris next week for a personal trip. And we are planning to meet because, well, we kind of kept the contact and became friends more or less. And, you know, like, that’s just really nice, you know, like that you can keep those relationships over a long period of time and build up trust and all those kind of things. And then also have a good time as some dudes walking around in the city and talking about life. So that’s pretty good.
Arvid Kahl 38:38
I’m happy to hear that I have the same relationship with Kevin. I mean, not exactly the same, obviously. But we still talk to I actually, when this episode comes out, it’s Kevin’s episode will be the one before this because I just talked to him. Right. So we we just chat all the time. And we even like this official public conversation still, because we both have a lot that we want to share and talk about in public. And you’re doing this now to I’m really happy about this, which kind of brings me to my next thought you’re not very active on Twitter, at least not in the moment. But I see you sharing all this stuff right here and you’ve written about it, you’ve obviously went on podcasts and you are on podcasts? Are you kind of getting back into the kind of building and public game into sharing your story is that’s what’s happening or is it just like a fluke right now
Moritz Dausinger 39:25
it is not, let’s say different. I made a break from it. Like I was much more active on Twitter. Up until, I don’t know, maybe one and a half years ago, one year ago, and there was no real reason or real event or whatever big decision I just kind of, I don’t know posted less than less and then you know, like, fell like I mean this kind of stuff. You don’t need to you either you want to do it or you don’t want to do it right if you don’t want to do it. There’s no no reason doing it. And but yeah, definitely a couple of weeks ago, I felt like, Okay, why not go on podcasts again, that was always something I really enjoyed doing. Because it’s much deeper and much more, there’s much more context in it. And so I was got contacted by one guy from Germany. It’s a German bootstrapper. Podcast, happy bootstrapping, as you’re talking German listened to a really nice guy. And yeah, I liked it. And I thought why not do a little bit more? Because sharing is important. And it’s not really sure. I mean, sure, it’s nice to be invited somewhere and then talk and it’s nice for the ego and whatever. But I wouldn’t be where I am, without all those blog posts, spending hours and hours on Hacker News back then, and indie hackers and Twitter, and this is basically the university. I mean, I did study stuff, but I studied other stuff, different things, right. Everything I did, I’m doing today, I basically learn through that. So I felt like, it always sounds a little bit cheesy, but I feel like it’s the right thing to share and give back.
Arvid Kahl 41:16
100%. That’s, that’s why I’m here. And I guess it’s also why you’re here. So it’s the perfect example. And I told you this in the beginning, if it wasn’t for you, I don’t know. Like I you know, I don’t know what would have happened because when Kevin reached out to us, and we had shared like our MRR numbers or stripe numbers on indie hackers, we’ve kind of plucked that in. So he found us through indie hackers, and then reach out to us through an email. I knew exactly who he was. And you did that you did that for him. And you did that for me, right? You connected us without even knowing that you were connecting us in some future scenario. And I think that’s what at least teaching in public, which is what you’re currently doing here with me right today. That is what that can do it on such a massive scale. And like prior to hitting the record button, we were talking about this, like the indie hackers scene has grown so much right? Over the last couple of years. When you were in Episode 24, it was still kind of a niche podcast. And now look at the indie hackers podcast and look at startups for the rest of us or other like podcasts in the space that have been going on for years, if not almost decades at this point. Isn’t that wonderful? I just I don’t know, I just want to be share my gratitude for people like you who were there from the start and sharing their story. And I think it’s important. So I can only recommend like doing more of this and also sharing more on Twitter, because I think you have you have a lot of pool, you have a lot of people following you. And you have a lot of interesting insights to share from running a business.
Moritz Dausinger 42:45
Yeah, and I feel like I mean, there’s always like let’s say like this, I’m very convinced like every journey is different. And you know, when I’m sometimes I’m doing mentoring sessions in a night, once this situation where I was telling somebody, something, and then after you later they told me, Well, half a year later, you told me that and it didn’t work. And I was like, Yeah, I don’t know. Like, I just said stuff, which worked for me. And I feel so I feel like you need to be really responsible in how you teach and how you share things. And again, I can just tell my story. I can. I’m 100% sure that any hacker who’s starting today has maybe more thing, more opportunities, but maybe it’s also more difficult. I don’t know like it’s different. And different. Yeah, that’s so the I think there’s a very how to say it. Like, you need to be careful not to put yourself there as the Google understood everything and look at me, like with refiner I had, it was the fourth product. I was building the fourth startup. And I was convinced I was having an easy time just executing whatever. And no, it didn’t happen. And so yeah, teaching great. But for all people just starting out, every be be be mindful about that. Every story is different than when we both started when we both sold our company. It was a different time. And sounds really like old dudes. On the radio. It’s kind of true. Yeah, that’s right. Different time.
Arvid Kahl 44:23
Yeah, it’s and you’re 100% Right. Like all advice is anecdotal. Like, it’s all just a story and experience that you have, and no advice is ever completely copyable in different circumstances. I 100% agree. And you’re right. In a way, it’s not even teaching. It’s just sharing. It’s just sharing a journey. It’s just giving people just insights into what happened. Why you think it happened, not why it happened. Because you never really know. Right? But while you have a strong sense that it happened for a reason, and then that’s all you can do, and people have to pull from that what they what they want to learn and I love this. That’s why I’ve been asking you questions not really, for you to give me answers on how to do it. But more answers on how you did it. And I, I feel you’re doing one other thing. And I kind of want to get back to this because as myself a coder as well, a technical person. And knowing that many people listening to this are engineers with, you know, not too much patience for marketing or for sales, but they they do want to build, they do want to make things you’re doing something with refined art is really cool. And you kind of make your documentation for your product, kind of a first class citizen of the product. And I’m going to kind of ask you like, how, how did that come to be? Why is that? And how do you keep this not just an add on but like a core part of your product?
Moritz Dausinger 45:39
Yeah, very interesting. Because when I look back at the products I was building, they kind of reflect me as a person in the way that they are technical. My audience, the users who are using my products like 1password, Doc pas and refiner, at least tech savvy people, they’re not coders, but technical people who like that about the software who like that they have lots of options to customize everything really the way they want to. And so the type of products, building our but I’m not, I don’t want to say complex because complex sounds difficult, I want them to be super easy. Let’s say they are powerful. And with that comes also options and customizations and all those kinds of things. And I feel like if I would not have a really top notch documentation, I would, that wouldn’t fit, right. That would feel weird in a way. And sometimes I’ve witnessed that with products, they have a beautiful website, like really shiny, super nice, well made website, you sign up. And then it’s already a little bit, not so beautiful, the software. And then you realize that it’s super disappointing, because there’s not much functionality, functionality, or it’s super complex, or whatever. And I don’t like this journey. I rather prefer having a good website, a good product and a good documentation and standard high. And so So I felt like for the type of product I’m building and the audience I’m having, I’m kind of it’s my job to say, look, you can do a lot of stuff with this software. It’s quite powerful. And I get it, it’s maybe not obvious to you. But it’s obvious to me because I built that. But it’s definitely not obvious to you because you’re using it for the first time. Here’s the documentation, I’m trying my best that it’s good for you, which then makes my life easier as well. Because I feel like with every user who’s finding their answer in the documentation, I have one more one less email to take care of.
Arvid Kahl 47:50
Interesting. So it’s kind of it is helping you reducing customer service load because people kind of help themselves. That that does remind me you were saying in the beginning that the thing you built that didn’t go anywhere initially for refiner was very like enterprise, the sales heavy or it focused at that. I guess now what you’ve been building is more of a low touch kind of SaaS. Do you think it I know, it’s still both. And that is an interesting thing. We’d like to know how you bridge this, like how you build a business that is both low touch SaaS ish. And, you know, high touch sales. But what I’m also interested in, as we are still at documentation, do you think like having a good documentation is actually a beneficial part of your sales process? Both in low touch and and high touch? Like how does it fit into this kind of dichotomy of sales?
Moritz Dausinger 48:41
Yeah, that’s a really a lot of good, good points in there. So when I started out, I started as product for startups starting at $39 per month. And I over the time, it’s so obvious, once you know it, once you see it, it’s so obvious, but then I didn’t see it all the time, I realized, actually, companies who are getting the most value out of my product are bigger. They’re not early stage startups, because if you to get value out of surveys, you need to have either a lot of users, and I’m talking like 1000s, and not to hundreds. Or end or you have a team, which is so big that like opinions or gut feeling is not counting that much anymore. So basically, you you’re having you think like, you know, like early day or early stage founders, often driven by gut feeling and talking with the users. And then it’s like, less about really like hard numbers. And this works really well and I’m still doing this, you know, like I’m still at that point. But once you’re becoming a bigger company, then you want to have some proof before you start the machine of implementing something. And this is when surveys can really, really get you a lot Have peace of mind, actually. And so I realized that the best customers in the sense of they are getting the most value out of it. More like established startups with attraction, or even scale ups, or b2c marketplaces, all these these kind of software companies. And with this realization came also going with the prices up. And so today the small price starts at 79, if you pay the yearly, but more like 99, if you pay monthly, and I mean, they’re their customers paying more than 1000 per month, like it’s really like a spend, which is I would call on maybe not already mid market, but But yeah, definitely not in the hackers, no, and no early stage startups, or just a sum of them. And with this knowledge came also the realization that on the upper end, they cannot go search service, they they cannot go low touch. I mean, even if they tell me, oh, look, I created an account, I understand the software, I know what to do, they still need to go through legal, they still need to pay invoices, on a yearly basis, they still want to have a signature on the terms of service, they still want to have on security audit, and so on and so on. So even if my user, the one who is signing up would like just to put in his credit card and be done with it, they can’t do that, because they’re in a bigger company where they have other processes. And this is where my colleague flurry comes in, where she is basically, for these kinds of customers, some kind of project manager, driving the project, project forward, following up talking with different stakeholders and so on. This is why I’m having this dual model. If it was up to me, let’s do low touch, right? I mean, there’s just this reality, if you buy if you sell to, if you sell to banks or whatever. That’s not how it works, right? So yeah, and this is why you can do both. And some, sometimes people are like, oh, I need to decide whether low touch or sales as sales driven. And I feel like yeah, all have it. Our customers like it like this, and their customers like that. And some people like to try it. Some people like to talk some people like to whatever. And then if you want to grow your business, then do all of it, right?
Arvid Kahl 52:39
Do you see a tendency? Like do you see a move more towards enterprise over time or like a shot someone?
Moritz Dausinger 52:45
Right now it’s quite stable, actually, they go feel like would need to look it up, I would say 1/3, custom contracts, custom pricing to a third is credit card. As is like.
Arvid Kahl 53:02
That’s I think like that, that immediately makes me think of technical implementation of that kind of pricing structure. I don’t want to dive into it too much. But I’m thinking, if this is what can happen to a business, it makes a lot of sense to think of your pricing structure, when you start building your business is something very flexible, right? Like, how did you how did you think about this? Like, how did you build?
Moritz Dausinger 53:24
Yeah, there was actually one pivotal point title, I don’t know how to say it. But Pivotal, exactly. In the beginning, I was charging based on survey responses. The more survey responses you collect per month, the more you pay me, didn’t work out, because there were a huge companies which were which were synchronizing all their user data to me. So I was like, crunching a lot of user data just to have like 50 responses, because they just wanted to serve a really tiny segment of the user base. So I switched the model to what I call monthly of what what is called, commonly called monthly active users. So the more users you are having, the more data you’re synchronizing with my app, the more you need to pay, which is kind of a better proxy for how much value you’re actually also getting out of the software. And this kind of stuff is baked in into the code in this in a way that I have an admin back end where I can for each account, say this is their quarter, then and also have feature flags, for example, they can access the translation feature, they can do this and this and this. And the way technically it is done is like somebody on a normal plan on the essential to growth plan will have by default, all the settings as written in my config file, but I can go in and override them. And then there’s this one special plan which is called the Enterprise plan and there it’s based Usually, the default settings are really generous. And I can still also go in and override for every account to thing. And then on the billing side I using I’m using charge B, which also allows me to set for every customer on the Enterprise plan, a custom amount. And so this is where you see comes also this all about automation before, that I’m dealing with invoices and stuff all day long. And the downside is really like the bigger customers. It’s so nice if you have suddenly like $500 Mr. On top, because there’s this one new customer, but this customer needs to have a new invoice in one year. So whichever reminder in one year, you’re going to send it and you need to send a couple of weeks before because they takes them some time. And so yeah, there comes the ops complexity.
Arvid Kahl 55:55
I guess it’s worth it. Right. That’s that’s kind of what I’m hearing I keep these big customers that their value metric is pretty, pretty scalable. I do wonder how much does this cost to run? Because if you ingest all this data, you kind of have to have some kind of cloud hosting and all that. Is that manageable? Like how do you manage that cost down?
Moritz Dausinger 56:14
It is an issue, right? So my approach to the past was always, as a tiny team, I’m happy to pay more to AWS for managed services, Manage Database, manage queuing, all the you know, the SQS, the s3, the RDS, it’s such a really, if you just it just it’s just running. And well, there’s a price to it. And the price is now becoming so big that I could actually basically hire somebody. Maybe not full time. But I could definitely spend some money on somebody who can help me putting all this on bare metal and let it run for her know, maybe 1/10 of the cost. Because right now I’m at the point where I’m between 15 and 20% of the Mr. Which goes straight to AWS. And I know that in the past, it was more like for my other businesses like five to 10, which I don’t know if there’s a benchmark out there, but I know there are lots of very, very successful businesses which are paying a couple of $100 per month. So the the cost for me right now is like really one of the it’s definitely a topic and with 20% of your MRR going straight to the hosting provider. It’s painful. Yeah.
Arvid Kahl 57:43
Oh, yeah, that is expensive. It does remind me of what we did with Vita panda. Because we did hosted database, like my managed database stuff as well. I think we paid like it when we sold. We had 55,000 and MRR and I think at least 5000 of that was an expense just purely to I think Mongo HQ was the name of it composed was so was later bought by bought by IBM at some point. It’s just for database, which
Moritz Dausinger 58:08
is 10% off to present. But that was
Arvid Kahl 58:11
almost the only expense we had. So we were good. But you know, it’s still it’s substantial. it’s substantial. And you’re right at that point, if you if you pay $5,000 a month for something that would cost you maybe a couple hundreds in, like the technical expenses, you could pay the remaining 4500 To a person to be there all the time and dealing with it. It’s just I always, in my own mind, I always thought I’m paying 5000 To compose because they have a team of 20 people that if something goes down, it’s up again, because they’re working in shifts. If there is like a zero day exploit somewhere, they immediately patched a system, you know, if a server explodes or what wasn’t that like in I don’t know if it was in France, or something recently, where there was this flooding into the data center. Like if that happens, somebody is swimming to my server and making sure it’s still running. You know, that’s kind of what you pay for it
Moritz Dausinger 59:03
moment. Exactly the approach that I had, like, whatever I can the hosting sites, give to a managed service. And I would really recommend that actually, like I would definitely not recommend trying to save 100 bucks in the beginning and then run your own database server and rescue business because maybe you misconfigured it and your database is gone. Right. I mean, that’s risky. That’s a major risk. And yeah, but as I said before, like right now I’m coming to a point where I feel like something should be done about.
Arvid Kahl 59:36
Yeah, you’re right, though. Like it’s not just misconfigured. And then it’s kind of gone because it implodes, but also somebody might just really get access to all your customer data. Right. So and the more you move into your kind of compliance level enterprise sales demo, you have to be absolutely clear that the thing you checked on their checkbox is actually protected. Right?
Moritz Dausinger 59:55
Yeah. So for the audit. That’s another really big point, folks. Somebody in the GDPR world, we are hosting in Europe because of that. And AWS allows us to do that. Security wise, the data is encrypted in transit, and also addressed this kind of stuff, like, yeah, you can do all this, but I am not a DevOps engineer. And these guys are super expensive. And yeah, as you said, you you’re not getting this level of riobel reliability yourself. And this is why I’m kind of continuing with it. And it’s already one year that I’m saying I need to reduce the cost. But then
Arvid Kahl 1:00:40
well, you’ll find you’ll find the right time for that kind of kind of brings me to kind of the the final question where, what are your future plans for refiner? where’s this going? What do you what do you plan for the next couple years? Or do you even have plans? I’d like to know,
Moritz Dausinger 1:00:54
it’s a really good question. So like, on the product side, there are a couple of things I could do. Because, you know, like with refinery, basically in the product, that would be a web app or mobile app where I’m displaying inside the app survey. And a couple of other tools exist. They are like onboarding, tool tips, or checklists, whatever you can, you can do a lot of action stuff inside an app. So I could branch out there. There’s another opportunity where it could branch out more into the data crunching and maybe add a layer of that you can also send me product usage data, then I could do stuff like, look, power users, more satisfied and no power users. And I mean, we can do that already today with integrations and our customers are doing that. But I could build that in into my product. So there’s lots of stuff I could do. And at the same time, I’m feeling like, well, maybe refiner is justice, pro poor tool thing. There’s very, very specific tool, which allows you to do the best possible in app survey experience. And it’s fine like that, you know, like, I’m not really, I didn’t decide on that right now. And in terms of the company, like, what I would like to do, is definitely hire support and Customer Success people. So that this is off my chest like because you know, like being in the owner or like a solo founder. And everybody knows it, right? If there’s so much freedom, there’s so much good parts about it. But one of the huge downside is you are responsible all the time. And I can right now, like when I go on vacation, I can put it down to like 15 to 30 minutes per day on the good days. And so I need to check him out in the morning. And I’m telling myself, well, that’s fine. That’s a good price to pay for all the freedom which comes along. But I think one of the goals would be to be at a point where the team is like, really bulletproof. And I can say, if I don’t get an SMS or phone call, I consider everything is going fine. And I said we’re gonna go.
Arvid Kahl 1:03:08
Yeah, that sounds like the perfect. It’s kind of reminds me of what John Warrillow was saying and built a cell, like the perfect sellable business is a business that can run without you where you remove yourself from operations. So that’s kind of almost the logical follow up questions. I know, you’re thinking about eventually exiting the business, is it going to be sold one day? What do you think?
Moritz Dausinger 1:03:30
You know, you never know. Right now isn’t a good time. I think now, it’s not the right time. For several reasons, I think. Not actually not for several reasons. It’s just not at the point where I would like to let it go. There’s really like just so much stuff. I can still do. I want to do. But yeah, it’s talking to us again. Yeah, that’s
Arvid Kahl 1:03:56
right. Yeah, that’s I think that’s that’s the mentality that indie hackers just develop at some point. Right? We will see also, not now maybe, depends on the offer. Right? It’s always it’s always combination of,
Moritz Dausinger 1:04:08
and what you just mentioned, right? I don’t know who said it, like, maybe it was also Kevin. A business that is easy to run, and business, which is easy to sell, like basically what you just said before, like in different words. And it’s kind of should be, I mean, there are times where you’re pushing in times where you’re giving all you have to make it grow as fast as possible. And I feel like the next step for refiner might be this well, it’s a marathon. Let’s do cool things down and then everything can happen right? Then I can run it for 10 more years because it’s cause Hackley. Salad, whatever
Arvid Kahl 1:04:49
I loved, I love the idea of like calming it down. Because once you’re calm, you see more things like you’re not in this kind of chaotic panic mode, because every fire needs to be doused immediately right but you Good. Okay, now this is a way I could go or let’s just slightly move over here. I think that is exactly right. I’m, I’m super pumped to just follow your journey along. And I, I certainly hope you’re going to be more active on Twitter, I’m going to try and follow you on every podcast you go at any point, obviously, but I would love to see you share more of this because I think the journey of a business that had to pivot like 18 months in and is now profitable, and then growing and finding enterprise customers, that is a story that is eight super successful compared to many other people’s stories, even though you might feel like you’re still in the middle of it, but just look at it from somebody who has nothing, right. This is a glowing example of how it could look like. And it’s something that I just want to see these little steps that you take off, I want to see, what are you trying here? Are you are you branching out to, you know, your tooltip kind of onboarding thing? Or are you actually focusing on just being the product that does this? This is exciting for me to just follow along the journey. So I would love for you to do this. And that brings me to my last question. Where can people find more about you? And where can they follow that journey that I just promised them.
Moritz Dausinger 1:06:08
So as I’m now restarting to use, Twitter is the best place definitely like, I feel like it’s for me, it’s still the place where I can, most easily and most freely, to speak my mind about the business. And I’m, you know, like, also Twitter is for me, like pure business. I’m not really. I’m not sharing personal stuff there. So yeah, please go to Twitter and Dow Zinger. I guess even a LinkedIn up. And I promise, I promise I will be more active there.
Arvid Kahl 1:06:45
I don’t I don’t want to put you on the spot. But I would love to see it because I think the community can benefit so much from you. I think they already have I certainly have. And again to bring this to a close. Thank you so much for everything you have done over the last six years in being there for people sharing your story, sharing your knowledge, and for keeping hopefully keeping keeping at it and keeping sharing your story, which was a wonderful conversation. Thank you so much for being on the show.
Moritz Dausinger 1:07:10
It’s my pleasure and really mean it and thank you for inviting me.
Arvid Kahl 1:07:14
Absolutely. Thank you.
And that’s it for today. Thank you for listening to The Bootstrapped Founder. You can find me on Twitter, if Twitter is still there, @arvidkahl. You find my books and my Twitter course there as well. And if you want to support me and the show, please subscribe to my YouTube channel, get this podcast in your podcast player of choice and leave a rating and a review by going to (http://ratethispodcast.com/founder). Any of this, will really really help the show. Thank you very much for listening and have a wonderful day. Bye bye