
Why We're Bootstrapping Readwise (2018) - tristanho
https://blog.readwise.io/why-were-bootstrapping-readwise/
======
eruci
I've bootstrapped everything I've ever built. Yet, I constantly get investor
pitches from bootcamp/accelerators/etc. One of them I got just the other day
put forward this interesting offer: "$25K for 6% equity" on my current
bootstrapped project which is earning about $20k per month in profit. Thanks,
but no thanks!

~~~
tarr11
$25K does seem somewhat pointless when you can wait a month and get that, with
no dilution.

Their offer was a bit low. However, it's not quite as insulting as you may
think.

Many bootstrapped SaaS businesses are valued at 3-6x profit (aka
"discretionary earnings") [1].

At 3x, your business would be worth $720K, which makes 6% $43,200

At 6x, your business would be worth $1,440,000 which makes 6% equal to $86,400

[1] [https://baremetrics.com/academy/how-to-value-a-saas-
business](https://baremetrics.com/academy/how-to-value-a-saas-business)

~~~
true_religion
That's a value for selling it to someone else in its entirety, but no one who
runs a stable business is going to sell 6% of their company at those rates
because it literally means that every share sale will turn a profit guaranteed
in 6 months _merely_ from dividends.

Imagine what the stock price of a company who boasted such dividends would be.

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gumby
> A budding minority within the tech community ... supplies an alternative:

A nice article (I am a fan of anything that supports reading!) but seriously,
bootstrapping has been the _default_ since literally forever (i.e. presumably
since the beginning of commerce, before the invention of reading). Tons of
successful businesses have been built that way, they may just not look that
way to you.

Consider that many may be bootrapped businesses that _later_ wanted money to
grow more rapidly than organically. As companies like that will have already
demonstrated market value and execution ability they can typically get better
valuations than just a PPT or a PPT+MVP

~~~
a13n
Within the modern tech community, bootstrapping is definitely a budding
minority.

You can tell because a bunch of investment firms have recently popped up to
try to capitalize on this new wave, like Earnest Capital.
[https://earnestcapital.com/funding-for-
bootstrappers/](https://earnestcapital.com/funding-for-bootstrappers/)

------
tristanho
Founder of Readwise here -- just posted this article from ~10 months ago on a
whim. Happy to answer any qs or chat about how the decision to start
bootstrapping has gone since then (well!)

~~~
nishanth_v
How are guys exporting highlights from kindle? A couple of months ago, I was
looking to implement a kindle to Evernote exporter. I couldn't find any
official API with the capability, so I ended up writing a scrapper that did
the work. See: [https://github.com/nishanthvijayan/kindle-highlights-to-
goog...](https://github.com/nishanthvijayan/kindle-highlights-to-googlesheets)

~~~
tristanho
We actually maintain an open source tool called Bookcision which is for easily
exporting your Kindle highlights which follows roughly the same approach we
take (but is non-automatic, unlike our product):

[https://readwise.io/bookcision](https://readwise.io/bookcision)
[https://github.com/tristanh/bookcision](https://github.com/tristanh/bookcision)

Readers should have access to their own reading data! :)

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harianus
> Now that we're bootstrapping, we've shifted away from a freemium business
> model (where users could optionally pay if they wanted) to a paid-only model
> after a free trial.

I think this is great, and where venture capital fails; having real demand and
not only focus on growth.

------
hiei
Can any one describe how they use readwise in their workflow or personal use.
Would love to hear - not affiliated with readwise please.

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djhaskin987
Often I'll buy a non fiction book solely so I can evangelize some best
practice or methodology by sharing the book around.

I still buy physical non fiction books because physical ones are just so much
more easier to share without worrying about copyright infringement.

Barring physical, I'd use Amazon precisely because it's easier to "lend"
someone a book if you're both on the same platform.

------
aaronbrethorst
_VC is known for loving bold, humanitarian visions, and a startup with the
mission to reinvent books should be a great fit, right?_

I can't tell if this is supposed to be sarcastic or not.

------
trevmckendrick
readwise is so good that even though I LOVE physical books, I don’t buy them
anymore. They wouldn’t get into my Readwise notes, which is now a crucial part
of my daily workflow.

~~~
TheSpiceIsLife
Would you mind sharing what device(s) you use, along with any other software /
services / etc you're using.

I've been reading books, mostly fiction, on my phone as I don't presently have
a tablet / ereader. I'd like to move away from reading mostly fiction again,
highlighting and note taking and all that, but don't have the gumption to
launch a research project in to what's available and what works.

~~~
hoodwink
Kindle for nonfiction. Audible for fiction. Instapaper for articles.

Take notes and highlights while reading nonfiction to better connect to the
material.

All hooked up to and constantly synced with Readwise for enhanced retention
and easy consistent review.

~~~
TheSpiceIsLife
Thanks. And where do your notes and highlights end up?

I have a flat text file that's nearly 1MB in size, that I started 17 years
ago! But it's just stored on Dropbox, which is cumbersome to use to search in
the file while mobile.

~~~
hoodwink
All my notes and highlights, from all sources, are in Readwise. Includes
metadata like tags, future notes, chapter, etc.

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sweetheart
Oh man, I’d never heard of Readwise before but this seems so useful! I love
things like highlights and notes on the Kindle, and how words you look up are
added to a special list for review later, but I never could figure out a
simple way to take advantage of that later. Does Readwise also handle that new
word use case? I love expanding my vocabulary and tend to exclusively read on
a Kindle.

~~~
hoodwink
Soon :)

Shoot us an email at hello@readwise.io and we'll send you more details.

------
_____s
This is a great post. The fact that you're bootstrapping is nice but I love
how clear you are on why you're doing that and how it helps your business.

~~~
tristanho
Thanks :)

For us, we're really not that dogmatic about bootstrapping vs VC. VCs are
definitely not evil, just optimized for a certain class of business, and
probably not in our best interest at our stage.

For another business, VC might be perfect, but in our space we've seen it
cause one too many "reading tech" startups to drive off a cliff :)

