I’ve officially sold Planscope, my first product business, and I’m now more committed than ever to DoubleYourFreelancing. Today I’ll tell you a bit about why I sold the company, what I’ve been working on recently, and what’s next for the site and the community.
On November 26th, 2011 I made my first commit to the Planscope code repository.
That was a defining day for me. It was the beginning of a journey that has led to a portfolio of profitable, bootstrapped products. It was the first actual product I’d ever tried that was grounded in reality (thanks to 30×500) instead of being some “brilliant startup idea” thought up in the shower.
I started Planscope for the same reason most freelancers have product ambitions: I wanted to sever the relationship between time and money, and I wanted a lot of customers rather than a few clients.
Now, I’d somewhat already cut off time from money. I was running an 11-person agency and I wasn’t personally billing any clients… but the success of the company was still dependent on me showing up to work. Even though I was running the show, I was in the office just as long (if not longer) than my employees.
But even though I had a successful agency, the overwhelming majority of our income came from just a few invoices a month. I watched people who had profitable software-as-a-service (SaaS) businesses and I wanted in. And nothing was technically keeping me — after all, we built that sort of stuff for clients each and every day.
So I started.
I coded Planscope, launched it at LessConf, and a few customers hopped onboard.
The Long, Slow SaaS Ramp Of Death
Gail Goodman of Constant Contact gave a talk at The Business of Software in 2011 titled “The Long, Slow SaaS Ramp Of Death”.
The gist of her talk was that building a subscription service business at $XX a month is hard work. A lot of new product owners go into their new business thinking that it’s going to be immediately successful and that once people learn about your product and how amazing it is (through a well-orchestrated and well-timed launch event), you’ll gain a ton of new customers and – BAM – hockey stick growth!
Realistically, this isn’t how it usually works.
If you’re growing at 20% a month and you’re making $300 a month, you’re on track for $360 in monthly recurring revenue next month.
It is if you’re expecting this new venture to replace your income, but not if you’re treating it as an asset. Many of us (myself included when starting Planscope) want our products to immediately replace our income. I can’t begin to tell you how many well-intentioned freelancers and agencies I’ve spoken to who think like that.
Unfortunately, most new products won’t replace their income anytime soon. If you’re expecting $8,000 a month to survive, it’s going to take quite some time of grinding it out to get your new product — especially a SaaS — to that point. And this is where most new founders throw in the towel. They’re not willing to continue to work at it without the validation that large amounts of money in the bank brings.
But if you treat it as an asset, much like you would a mutual fund in your investment portfolio, a 20% month over month growth rate is huge. Give it enough time, and a $300 business that grows at 20% a month will become a monster. Just look at Nathan Barry, for example.
I almost gave up, too — but support emails saved me
Early on I realized that I couldn’t run an agency and a SaaS simultaneously. It was too hard and required too much context switching.
I went all in on Planscope and exited the agency, entrusting it to my head of business development. For the next year or so, I made a humble income off the profits the agency yielded. But it definitely started to slow down, and our sales funnel started to spin down because there was no ongoing client acquisition effort.
But it wasn’t enough, especially considering that there were a bunch of bootstrapping and business conferences I wanted to go to.
I have to admit — it was pretty depressing.
Planscope, while growing, wasn’t paying the bills. I thought I’d need to go back to full-time consulting. I thought I could maybe consult a few days a week and code Planscope when I wasn’t doing client work.
But then something interesting happened.
Since the start of Planscope, I’d been helping customers with support. Early on, it was all bugs and questions about how so-and-so works. But I started getting a lot of questions that, in my mind, were out of scope.
“Any ideas about what I should charge?”
“Sorry, I need to cancel. My last client project just wrapped up and I don’t have anything else to work on.”
I made it a point to get to know each customer, and most of them knew my story. They all knew that I had built an agency and Planscope came from my days running this agency. I ended up getting a lot of support requests from people who weren’t looking for help with project management software, but instead needed somebody to help support their entire business.
I was dishing out the same advice over and over about pricing, getting clients, proposals, and so on — things I’d learned the hard way growing my agency — to customers of mine. I had a feeling that if they were more successful then maybe they’d stop running out of work — and I’d get more customer lifetime value!
And then Amy Hoy made a bet with me
You see, there was a conference I really wanted to go to in Ireland called FunConf (trust me, it was a business conference.)
A number of my friends, including Amy and her husband Thomas, were going to be there, and I’d always wanted to visit my ancestral homeland.
…But I couldn’t afford it.
Sure, I could have found a way to afford it. I wasn’t exactly running off of fumes — but we had some medical bills to pay at the time. In the eyes of my wife, custodian of the Dunn Family Budget, I couldn’t afford it.
I almost wrote off the conference, but then I got in a discussion with Amy Hoy.
Brennan: “I don’t think I’m going to be able to make it. Next year?”
Amy: “How come?”
Brennan: “…medical bills, Planscope’s not making a huge amount, etc…”
Amy: “You know how you’ve been talking to people about pricing? You keep dishing out the same advice. Why don’t you decide to write a book, pre-sell it, and use that revenue to come to Ireland?”
A bit of context: I’m a software engineer by training and I majored in philosophy, history, and the Classics. I don’t take books lightly. Books require time, preparing, publishers, and so on. And Amy was recommending I write an e-book. It wouldn’t have even been a Real Book(TM)!
But I held my tongue and put together a sales page that reflected a lot of the questions I’d been asked through the Planscope support channel. I sent a few emails announcing my upcoming book to the list of customers and trials in the Planscope users database. I called it Double Your Freelancing Rate In 14 Days.
And I ended up bringing in $2,213 in pre-sales almost immediately. Just enough to register for the conference and buy a round-trip flight.
But then reality hit… and I was sitting on a bunch of money
As I flew to Ireland, reality struck.
“I need to actually write a book. And fast.”
In all honesty, I really hated knowing that I was sitting on all this money (and most of it was now spent on the conference.)
I decided I’d start to email all the pre-sale customers each week until the book was done. I’d share what I was writing about. I figured that if people were getting summaries of the content I was writing they’d 1) get some value from me prior to the book launch and 2) see that there was forward momentum and that this wasn’t some bait-and-switch.
It took me a few months to finish the book, and I was terrified to send out the launch announcement email.
I was convinced everyone would ask for a refund. “This sucks.” “I already knew all this.” “Uh, refund please.”
I was convinced these people who spent $29 pre-ordering my book were going to expose me as an e-book peddling con artist.
Fortunately, my fears were unwarranted. Instead of refund requests, I was getting praise. I was actually helping people, and all I had to do was distil my experience and takeaways growing my agency into a self-serve book.
Things accelerated from there:
- I kept emailing my new list each week, even though I’d delivered the goods. And they seemed to like it.
- I wrote another book on generating leads online, which was one of the big questions I was getting from customers.
- I created the Consultancy Masterclass, a very small two-day class that was all about advanced-level consulting and growing an agency.
- I started the Business of Freelancing podcast.
- I completely rewrote Double Your Freelancing Rate after having talked with hundreds of customers and expanded it into a much bigger self-study course.
- I moved all of my content off of the Planscope blog and a portfolio of single-page domains and consolidated it all under DoubleYourFreelancing.com.
- I launched an intensive, six-month live class called Double Your Freelancing Clients.
- I hosted 140 people in my city for the inaugural Double Your Freelancing Conference last September and am doing it again in Europe this June.
- I launched a brand new course just the other week, Mastering Project Roadmaps.
- I built up a team of people who support me with DoubleYourFreelancing.com and its associated offerings, which is now responsible for more than seven figures in sales and tens of thousands of subscribers.
None of this was really pre-planned. New products came from talking with customers and subscribers, along with a lot of in-depth research and surveying. I changed direction and started new things because I had to, not because it was part of some giant business plan.
This new business — which again, started as a way to afford a trip to Ireland and later morphed into a lead generation effort for Planscope — started to quickly eclipse Planscope in success.
Remember how I said I struggled to run my agency and Planscope? Well, I soon began to struggle running Planscope and this new DoubleYourFreelancing.com business.
Planscope went into passive mode and didn’t get the love and attention it got early on. But people kept using it, even though there was an absentee landlord.
I realized that I love teaching. I love it a lot more than supporting and coding a SaaS.
I had to either shut down Planscope or give it to someone more capable and available.
I didn’t want to shut down Planscope because, like I mentioned earlier, people were still using it. And I believe in the goals of the product — most project management software sucks and isn’t designed for people who bill clients.
After talking with FE International, I discovered that what I was going through wasn’t really anything unique. A lot of founders get to the point where they sell off assets so they can focus entirely on others.
I was a little worried that the buyer would be a serial entrepreneur or holding company that just gobbles up SaaS companies. I wanted somebody like me, but with the time to focus 100% on the product. (I’ve always said that Planscope would be a million dollar a year business if I could clone myself and strip the love of teaching from that clone.)
During the sales process, FE International introduced me to a potential buyer, Josiah, a fellow dad out in Portland who was looking to run a small software business. What attracted him to Planscope was that it was already built and validated, but it just needed some love and attention.
After our first call, I knew that if he made an offer he’d be amazing for the product. He’s a solo, bootstrapped founder (like myself) who cares a lot about quality and customers. And to top it all off, he’s an engineer himself. He’s not afraid to get his hands dirty in code.
We went through the due diligence of handing off Planscope and making the sale. (Lesson learned: if you want to ever sell an asset, like a SaaS, give it its own dedicated bank account, credit card, and subscriptions to services.)
I’m excited to formally introduce you to the new owner of Planscope, Josiah Johnson. If you’re already a Planscope customer, I regret that I couldn’t be as attentive as I should have over the last year or so… but now you’re in awesome hands. Josiah’s going to bring this product to the next level.
And if you’re not a Planscope customer, you should be. It’s still my “first baby,” and rather than making a clean break I’m committed to helping Josiah steer it in the right direction (I know a lot about the project management needs of freelancers) and continue to promote it for him right here on DoubleYourFreelancing.com.
With Planscope and the sale off my plate, I’m now freed up to focus entirely on my education business.
In my annual report for 2015, I talked a bit about what’s next for DoubleYourFreelancing.com. I want to leave you with a brief update:
- We’re working on a major redesign of the site. It’ll still retain its simplicity, but it’ll be easier to use and will be less of a blog roll.
- Annabelle Dura is working with me to lead the new worldwide DYF freelancer meetups. She’s been reaching out to people who have volunteered to lead these monthly get-togethers and hashing out the details. We’re hoping to have an events page on the site soon that’ll help you find your local group and get you connected with other business-minded freelancers in your area.
- DYFConf Europe and US 2016 are in the works. The European conference is now open for registration (with an earlybird discount) and Xander and I are ironing out the details for the next US conference, slated for the fall.
- I have some AMAZING upcoming podcast guests in the queue. We’re doubling down on our efforts with the podcast (thanks Kai!)
- I’m working on a mass-market book that’ll be targeted to people who want to freelance full-time but aren’t yet.
We’ve got a lot going on! Thanks again for being a part of this, and I can’t wait to help bring even more success to your business this year.