I just sold my 4th bootstrapped SaaS business for 7 figures as a solopreneur. Obviously I learned a ton (like I always do with each startup).

Here are 10 important lessons I learned the hard way:

(Maybe you already know all of these. The list is far from exhaustive)

Lesson 1

Wearing all the hats is risky business

In the early days of SEOJet, signing up was by invite only. An automated email would get sent out after 20 minutes of a potential customer requesting an invite.

Because I was so busy with all the tasks of running and growing the business I didn’t realize for 6 months that all of the automated emails telling people their invitation had been approved were going straight to spam.

Obviously this meant a huge slow down in sign ups. I just assumed no one liked my software anymore.

During those 6 months 6000 people requested an invite to sign up for SEOJet and none of them ever saw a reply from us.

When I figured this out, first I cried inside, then I was happy to know that the reason the business wasn’t growing was because of a dumb glitch.

But that glitch probably cost me $250k.

Lesson 2

Don’t fall in love with just one customer acquisition channel, no matter how well it is working

I have a long history as an SEO expert. I started back in 2002 and have made a very good living ever since using SEO almost exclusively as the main driver of traffic.

Because SEOJet was a platform built for businesses doing SEO I knew I needed to rank well in the search engines to prove the software was legit.

This strategy worked well for a while but growth became inconsistent.

It wasn’t until I paid a well known SaaS founder to teach me how to crush FB ads that I experienced crazy predictable growth. (Hint: we doubled in size in 6 months)

Lesson 3

Don’t be afraid to raise your prices, even with current customers

This was another lesson I learned from a mentor. I was petrified to raise prices on my customers but he insisted and begged me to do it.

I finally doubled my prices and only lost about 20% of my customers.

It was a huge increase in MRR for me by simply sending an email saying prices were going up.

Lesson 4

You need predictable growth to become more acquirable

I always knew I wanted to sell SEOJet, but I wanted to get at least 1 million for it.

The 17 other small internet businesses I had sold before that all relied on SEO traffic for their revenue I knew that potential acquisition partners would look down on that because of the risk involved.

This was the main reason I turned to the other SaaS founder to mentor me with FB ads. If investors can see a way to put more money in and get even more money out, this really increases the value of the business.

Lesson 5

You don’t need employees to be a successful company

My goal from the beginning with SEOJet was to be a solopreneur and sell the business for a million dollars.

I accomplished that goal and then some.

But I did have a few contract workers that I paid to help me with tasks I didn’t want to or couldn’t do.

Frankly I couldn’t have done it on my own.

Lesson 6

SEO is not free

There is a big fallacy in the SEO world that SEO is free.

This is why almost all bootstrapped founders choose this as their main customer acquisition channel.

Sure, once you’re ranked high you can get free traffic.

But there is no way to rank for any key phrases worth ranking for without having to spend money on amazing content and a lot of backlinks.

During the 4 years that I ran SEOJet I spent at least $50k on backlinks for my own business. I did that because ranking well was critical for my credibility.

The sad truth about SEO that no one is willing to admit is that those companies that can spend the most are going to win.

On my new startup SquidVision (not in the SEO space), most of the marketing budget (at least until we are self sustaining) will go towards FB and Google ads.

Lesson 7

Don’t be afraid to shift your business model

I figured out an awesome way to generate more revenue from my subscribers by offering to sell guest posts on the backend of the software.

It integrated beautifully with the software and was a financial hit right from the beginning. It quickly became a bigger source of revenue than subscriptions.

But again, it was unpredictable how many guest posts my users were going to buy each month.

I knew that for resell value I needed to shift the business model so that the majority of the revenue was on the subscription side.

I did this by changing our plans so that the more money a user paid in their subscription, the bigger discounts they received on guest posts.

This strategy worked like magic and also reduced churn because our users came to depend on those discounts.

Lesson 8

Create an audience before your launch

I realize that this isn’t always possible, but before I launched SEOJet I had built another smaller SaaS product called Guest Post Tracker.

It was a really simple tool that I charged $37 for lifetime access.

But the audience was exactly the same audience that would want to use SEOJet. So Guest Post Tracker essentially became the tripwire offer for SEOJet.

When I was ready to launch I reached out to GPT users and asked if they wanted to be beta users. Over 100 of them said yes. (There was no free beta)

Lesson 9

Talk to your customers in the beginning

One of the smartest things I did in the beginning was I forced everyone that wanted to sign up for SEOJet to first get on a demo call with me so I could walk them through the software.

This was super valuable for me to hear from my target audience the parts of the software they were really resonating with and were excited to use.

I could then take that info and tweak all of my marketing copy to really focus on the features and benefits I knew my audience would care the most about.

The close rate from these demos was probably about 60% and many of them were still customers when I finally sold the company.

Lesson 10

Always be testing – AB Test everything

I love running AB tests. Increasing conversion rates is super fun for me.

It was critical for the growth of SEOJet when I needed to squeeze more revenue out of the business without increasing traffic.

For bootstrappers, it’s free and frankly there is very little downside to it.

You should absolutely AB test the crap out of your homepage, and paid advertising landing pages and probably your pricing and sign up pages.

If you’re curious about what I’m working on now, I built SquidVision.com to help SaaS business owners grow their revenue by showing them a visual overlay of exactly how much revenue every single button and link generates on each page of their website.

It’s really useful to track how effective your content marketing campaigns are and how well your landing pages are performing.

When you can see exactly how much revenue has been generated by each CTA on every blog post and landing page it becomes really clear which posts to focus on promoting.

It might be the most addictive (non-social media) app out there, IMHO.

We’re going live in just a few weeks. Join the waitlist here: https://squidvision.com/

Thanks for reading!

Obviously there are many more things I could have included. What critical tips did I leave out?

Need some help with your SaaS growth?

I have been building internet businesses for over 20 years and have built and sold 4 SaaS companies.

I take on one or two SaaS clients at a time. Reach out to me. Let’s see if it’s a good fit.

As many of you know apart from buying and selling websites and running Prosperly, I also own and run http://www.seoscheduler.com. It’s SEO software I created to make SEO affordable for anyone.

Anyway, we were recently implementing a new product on the service (Where We Do The SEO For People) and I somehow made a mistake and uploaded an old file that listed our basic membership at the wrong (much lower) price. I didn’t realize this had happened until someone contacted me to let me know the site says one price but when they go to pay it tries to charge them the real price.

So I decided to honor that discounted price so as to avoid any customer service issues. Boy was that a mistake.

So I gave the person the huge discount and from the minute they became a member I started getting one email after another from this person. The emails would say ridiculous things like “I don’t believe you have been doing SEO for 10 years.” and other stupid comments like that.

This person clearly “knew” more about SEO than I did. So after the 13th email in 3 days I realized this was going to be way more of a headache than it was worth.

So I did something that you might call crazy. I immediately went to paypal and canceled his account and gave him a full refund. He never asked for me to cancel his membership, I just knew that my time was worth waaaaaaay more than he was paying me to sit there and answer dumb emails all day.

Don’t get me wrong, I like my customers and I am a big believer in great customer service but one thing in business I have learned over the years is you need to know when to fire your customers. I know the concept sounds crazy but there are just some customers that will be such a headache for you that they will cost you money.

It was the same way when I was taking on high level SEO clients, after having a few crazy clients I learned how to quickly filter them out so I didn’t have to take them on as clients.

Here is how I did that: I would think of how annoyed I would be dealing with a customer who always complains and is contacting you all the time. Then I would think of an amount of money that someone would have to pay me for me to go through that. Lastly I would add $1000 to that price and that is what I would quote the crazy potential customer.

Let’s just say it worked like a charm. If they were dumb enough to give me that much money then I would deal with the problem.

Here is a good indicator if they are going to be a problem customer: If they haggle with you on the price from the beginning they will most likely be a problem. It’s not always the case but what I have seen over and over is people that haggle will never stop haggling you. They can’t do it. It’s not in their nature to stop.

The reason it’s people who haggle you on price is because if price is an issue then it means too much to them. They are probably looking to have you answer all of their business and life problems and they won’t stop bugging you until you do.

Someone who is fine with whatever quoted price you give them understands the reality of business and they have more important things to do during the day than to stock you and ask you why everything is not happening quicker.

Sometimes you need the money really badly and you just have to put up with an annoying customer, but when you get to the point that it isn’t worth it to you, that is when you fire your client. It will be hard at first until the peace that overcomes you after they are gone and you realize life is so much better than it was before.

I can’t tell you how happy I was to get an email from this customer I just fired that told me that me cancelling his account was proof that I didn’t have any of the answers for him. He has no idea how right he was.