What do I do about my business?
October 4, 2023 2:26 PM Subscribe
In 2020, I started a little business - a software-as-a-service startup. Very little: an LLC, just me, did it all myself. It landed in the middle, making enough to pay for itself, but not enough to draw a salary. It has users, who like it. It also causes me a tremendous amount of stress and I can't figure out what to do about it.
I feel guilty about the current state of it because I'm not spending that much time working on the software, so I feel like I'm not putting in enough work for the customers. But it's hard to think about just shutting it down, because people really do get some value out of it, and maybe in the long term it could be worthwhile.
I have a day job now, which occupies a lot of my time and energy. So this issue just keeps coasting along indefinitely, but every time that I have to log into the business bank account I panic, thinking that it'll be declining. It's awkward to field questions about it, and it's a real trigger to talk about it with my parents and friends. They want to be encouraging, but the reality is, I'm just disappointed by how it's gone and can't figure out how to get to the next step.
Thankfully, the fact that it didn't take off doesn't affect me materially - I had a solid job before working on it, have one now, no big loss of any kind. But it's just… weird.
I don't really know who could help with this. It's probably not making enough to be an interesting acquisition target. The technology is neat, but you know how much that counts for. I could use a combination business partner plus therapist to deal with the emotional and practical ramifications of what comes next.
What do I… do?
I feel guilty about the current state of it because I'm not spending that much time working on the software, so I feel like I'm not putting in enough work for the customers. But it's hard to think about just shutting it down, because people really do get some value out of it, and maybe in the long term it could be worthwhile.
I have a day job now, which occupies a lot of my time and energy. So this issue just keeps coasting along indefinitely, but every time that I have to log into the business bank account I panic, thinking that it'll be declining. It's awkward to field questions about it, and it's a real trigger to talk about it with my parents and friends. They want to be encouraging, but the reality is, I'm just disappointed by how it's gone and can't figure out how to get to the next step.
Thankfully, the fact that it didn't take off doesn't affect me materially - I had a solid job before working on it, have one now, no big loss of any kind. But it's just… weird.
I don't really know who could help with this. It's probably not making enough to be an interesting acquisition target. The technology is neat, but you know how much that counts for. I could use a combination business partner plus therapist to deal with the emotional and practical ramifications of what comes next.
What do I… do?
I think you should try to sell the business. However, if that's not possible...
people really do get some value out of it, and maybe in the long term it could be worthwhile.
If they get value out of it, they should pay for that value. This seems like an opportunity to progressively increase prices to either a point at which you are happy doing the work because it's worth your time, or for your customers to drop off because it doesn't have value commensurate with the price. Either option should be considered positive. Even losing customers is meaningful - it means that notion of "long term success" is not really all that viable and wasn't something that was ever a possibility in the first place.
As a random example, I'm currently using (sort of) a software package from a company that underprices their product. I will never tell them that. I would easily pay them 20x what they currently charge.
But it's just… weird.
There are many opportunities in the world - more than the vast majority of folks can handle. The most effective people I know tend to spend more time figuring out what they aren't going to do than figuring out what they are going to do. If you aren't actively managing your opportunities to only the most important/useful/profitable ones, you are doing yourself a disservice.
posted by saeculorum at 2:39 PM on October 4, 2023 [11 favorites]
people really do get some value out of it, and maybe in the long term it could be worthwhile.
If they get value out of it, they should pay for that value. This seems like an opportunity to progressively increase prices to either a point at which you are happy doing the work because it's worth your time, or for your customers to drop off because it doesn't have value commensurate with the price. Either option should be considered positive. Even losing customers is meaningful - it means that notion of "long term success" is not really all that viable and wasn't something that was ever a possibility in the first place.
As a random example, I'm currently using (sort of) a software package from a company that underprices their product. I will never tell them that. I would easily pay them 20x what they currently charge.
But it's just… weird.
There are many opportunities in the world - more than the vast majority of folks can handle. The most effective people I know tend to spend more time figuring out what they aren't going to do than figuring out what they are going to do. If you aren't actively managing your opportunities to only the most important/useful/profitable ones, you are doing yourself a disservice.
posted by saeculorum at 2:39 PM on October 4, 2023 [11 favorites]
It sounds like you don't want to do it any more. If I were your customer, I'd want to know earlier rather than later, so I could plan a transition to something else. I hope you have some support for this (export functions?).
posted by zompist at 2:52 PM on October 4, 2023 [1 favorite]
posted by zompist at 2:52 PM on October 4, 2023 [1 favorite]
If the software can handle more users without (too much) effort on your part, and the market isn't already saturated, then expand the user base.
If you haven't contractually locked in a lower price, then raise your price. You have users who like your product and presumably don't want to stop using it. Right now they're collecting its surplus but you are not; raising the price could ensure that you both collect some of the surplus.
(Consider, in doing this, that different people may be willing to pay different prices, and that you might be able to find a way to distinguish among them and charge a higher amount to the ones who are more willing to pay.)
If you currently aren't profiting, and you can't increase your profit by expanding the user base, and you can't increase your profit by raising your price, and you can't collect a profit by selling to somebody else -- then okay, the project wasn't profitable. That's fine! Most ventures aren't! Still a very cool accomplishment, worth putting on your resume and mentioning in your Christmas letter. But please don't feel you have some kind of moral obligation to keep the project going indefinitely, after it's become a psychological burden.
posted by foursentences at 3:11 PM on October 4, 2023 [3 favorites]
If you haven't contractually locked in a lower price, then raise your price. You have users who like your product and presumably don't want to stop using it. Right now they're collecting its surplus but you are not; raising the price could ensure that you both collect some of the surplus.
(Consider, in doing this, that different people may be willing to pay different prices, and that you might be able to find a way to distinguish among them and charge a higher amount to the ones who are more willing to pay.)
If you currently aren't profiting, and you can't increase your profit by expanding the user base, and you can't increase your profit by raising your price, and you can't collect a profit by selling to somebody else -- then okay, the project wasn't profitable. That's fine! Most ventures aren't! Still a very cool accomplishment, worth putting on your resume and mentioning in your Christmas letter. But please don't feel you have some kind of moral obligation to keep the project going indefinitely, after it's become a psychological burden.
posted by foursentences at 3:11 PM on October 4, 2023 [3 favorites]
If it's making money with little effort required to keep things running day-to-day, then it has some value. I'm not sure about applications, but (for example) niche websites typically sell for 30-40x their monthly revenue. I assume SaaS things have a similar rule-of-thumb, I just don't know it. Flippa is one marketplace that deals with small-scale SaaS apps, I'm sure there are others as well. At the very least, take a look around to start to get a feel of what your project might be worth.
If it's a burden, just let it go. Close it down or sell, but don't hang on out of guilt. You've effectively created yourself a part-time job you're beginning to hate, it doesn't pay well, and it's causing you mental anguish. Time to do something else.
posted by cgg at 3:36 PM on October 4, 2023 [3 favorites]
If it's a burden, just let it go. Close it down or sell, but don't hang on out of guilt. You've effectively created yourself a part-time job you're beginning to hate, it doesn't pay well, and it's causing you mental anguish. Time to do something else.
posted by cgg at 3:36 PM on October 4, 2023 [3 favorites]
If you don’t want to sell it, could you open source it so it still gets maintained for the folks who want to use it?
posted by matildaben at 4:05 PM on October 4, 2023 [9 favorites]
posted by matildaben at 4:05 PM on October 4, 2023 [9 favorites]
Talk to your users. Maybe even do a few zoom brainstorming sessions with them.
posted by Sophont at 4:42 PM on October 4, 2023 [2 favorites]
posted by Sophont at 4:42 PM on October 4, 2023 [2 favorites]
You could find a partner. Give them 75% of the business in exchange for them running it day to day and building it up. Right now, it is worth less than zero to you because of the mental time and anguish. Make it someone else's problem while maintaining some upside.
posted by JohnnyGunn at 4:51 PM on October 4, 2023
posted by JohnnyGunn at 4:51 PM on October 4, 2023
Ask your customers. Tell them what it would take to do what they want, whatever that is, and at whatever levels you can imagine.
posted by amtho at 5:01 PM on October 4, 2023 [2 favorites]
posted by amtho at 5:01 PM on October 4, 2023 [2 favorites]
You say you need a combination business partner and therapist - the former is hard to find and a huge commitment but the latter can be hired by the hour and will in all likelihood help you work through your feelings, which seem to be the actual main problem.
posted by Superilla at 8:17 PM on October 4, 2023 [1 favorite]
posted by Superilla at 8:17 PM on October 4, 2023 [1 favorite]
Given that acquisition is out (I get the impression that you are well-connected enough in the product's domain that if there existed someone capable that was interested in taking the business over, you would know about them) and the fact that you do want it it to continue to work for users, I was going to suggest what people were calling "exit to community" a few years ago.
This would involve setting up some charter, then finding some maintainers and releasing the source. (Though to caveat myself, sometimes things don't turn out as you'd expect after you hand something over.)
MLTSHP is a community-run version of MLKSHK, a privately-run business, that released its code when it closed. It's still running today. However, I think you have to be pretty lucky with finding maintainers for things to work out that well.
Still, community project survival odds aside, on your part, it's a finite amount of work, and you can say you gave the users a best effort.
I do agree, though, that talking things out with a therapist so you know what you're feeling and what possible root causes may be is a good idea. (Though therapists are also hard to find.)
posted by ignignokt at 8:45 PM on October 4, 2023 [3 favorites]
This would involve setting up some charter, then finding some maintainers and releasing the source. (Though to caveat myself, sometimes things don't turn out as you'd expect after you hand something over.)
MLTSHP is a community-run version of MLKSHK, a privately-run business, that released its code when it closed. It's still running today. However, I think you have to be pretty lucky with finding maintainers for things to work out that well.
Still, community project survival odds aside, on your part, it's a finite amount of work, and you can say you gave the users a best effort.
I do agree, though, that talking things out with a therapist so you know what you're feeling and what possible root causes may be is a good idea. (Though therapists are also hard to find.)
posted by ignignokt at 8:45 PM on October 4, 2023 [3 favorites]
It landed in the middle, making enough to pay for itself, but not enough to draw a salary.
No specific advice, but I think that this sentence isn't exactly correct and it might help you to change your thinking about it. If the business isn't making enough to pay you to run it, then it isn't in the middle, it is losing money. Because of the way you are framing it in your mind, you are valuing your own input at zero, and that isn't fair to you. It's ok to admit that the business isn't doing as well as you had hoped, and with that acceptance, it might be easier for you to decide what the next step is.
posted by Literaryhero at 8:54 PM on October 4, 2023 [9 favorites]
No specific advice, but I think that this sentence isn't exactly correct and it might help you to change your thinking about it. If the business isn't making enough to pay you to run it, then it isn't in the middle, it is losing money. Because of the way you are framing it in your mind, you are valuing your own input at zero, and that isn't fair to you. It's ok to admit that the business isn't doing as well as you had hoped, and with that acceptance, it might be easier for you to decide what the next step is.
posted by Literaryhero at 8:54 PM on October 4, 2023 [9 favorites]
Any chance your alma mater has a Center for Entrepreneurship or business incubator? These are people who know of what you are experiencing and have networks for whatever you decide is your next, best step. Best wishes with discernment.
posted by childofTethys at 7:05 AM on October 5, 2023 [1 favorite]
posted by childofTethys at 7:05 AM on October 5, 2023 [1 favorite]
« Older What's the point of no return in Tears of the... | "You got your database on my word processor!" Does... Newer »
This thread is closed to new comments.
I think it's awesome you built and ran a useful SaaS by yourself.
posted by fingersandtoes at 2:31 PM on October 4, 2023 [16 favorites]