Over the past decade, I have had a B2I EdTech company that has provided me a comfortable living without investors on my back, but for the life of me I cannot grow!
It was never my intention to create something big. I just wanted to live in the Caribbean, kitesurfing every day, and earn ~$4,000 per month without working too much.
My plan worked out and I spent a tremendous 10+ years living like a grasshopper, traveling the world, working a few hours a week and finally settling down in a beach house.
The problem began when I fell in love with a local girl... Her job was in finance for a hotel where she earned $400 a month, but she proved to be a math whiz. As she worked her way up in corporate America (online), within a couple of years of getting married, she got a job offer for a six-figure salary in Boston, where we bought a house and had a child.
While this may sound like a great story, my $4k/m has recently shrunk to $3k. I have lived a decent life on the island with that money but in Boston, I am struggling to get by. Over the last couple of years, I have been searching for ways to increase my revenue but to no avail, which is why I am seeking advice from this great community.
About my company
- EdTech / B2I (schools) / Online tutoring & OPM - We solve an important and interesting problem in our industry. - Excellent moat. Sophisticated software. - Very long sales cycle but very long contracts - 6 school partners (non-us) - 100% bootstrapped - 2 employees / full time, offshore (developers) - 0 growth / main problem: no established sales channel.
About me
White-male, 40+yo, non-English native. I grew up in a low middle class family in the middle of nowhere. My degree is from a community college. Needless to say, I am not part of any influential circles.
What I tried
1. VC / Angels The only way I could approach VC/Angels was by cold emails. A few third-tier investors responded. They liked our mission, business model, revenue, client's list… but we always failed their ultimate question, "who is your lead investor?". I felt that rather than having a genuine interest in the company they are considering, most seed investors hope that the founder will introduce them to more prominent investors. https://twitter.com/Jai__Malik/status/1351363787614523395?s=20
2. Boston seed stage I am aware that Boston is the 3rd startup hub but I soon realized that 90% of that money goes to MIT/Harvard founders and/or > Series A. Seed round for non-MIT/Harvard is close to non-existent.
3. Accelerators I interviewed for the TS, 500, and YC accelerators. They all rejected me. I’ve been accepted by 2nd tier accelerators but I spoke with previous founders who revealed that their entire cohort did not raise a single dollar.
4. Meetups Due to COVID, there are not many edtech meetups. Connecting with other founders did not produce any significant results.
5. Revenue share Not enough revenue.
What I think would work.
Our US competitors are all getting new contracts through RFPs. Each of these companies is well funded, so they hired a team of RFP experts. I participated in a few (it takes about 2 months) and lost them all to companies with inferior products, higher bids, but better presentations. RFP specialists are not motivated by equity from a bootstrapped startup. Even if they are very excited about the idea, they would not take a leap of faith.
...any advice?
As the founder you need to sell, sell, sell. Oh did I mention sell?
You need to develop a sales cycle, that means everyday picking up the phone and cold calling, any interested leads get followed up to a schedule 3months, 9 months, 24 months, build out your marketing emails, write monthly blog posts and post to linked in.
Are you attending education conferences?
1. Find a salesperson who works on commission.
2. Get a job to pay bills, and use the business revenue to hire an RFP expert/sales person.
3. Sell the business (on microacquire).
4. Devote your time to learning how to be an RFP expert and make the sales. If other people can make sales you should be able to replicate what they're doing.
I would go with #2. #3 may sound attractive short-term, but once you've run out of the money you'll have to get a job anyway, so might as well get the job now and use the revenue to hire a salesperson and grow the business. It sounds like for whatever reason you don't want to do sales or aren't willing to devote the time to do it effectively.
Would schools leave you if you raised your prices 20%? 50%? 100%? 200%?
Also sometimes high prices make your product appear more professional/institutional and make it actually simpler to sell. Especially in areas where the buyers have no expertise in the technology they buy. They go for the most expensive cause they think it’ll be the best.
Good luck!