This is a post by Jesse Pujji. Jessi a serial entrepreneur that lives in the US. He has:
- Bootstrapped to an 8-figure exist with his previous startup, Ampush
- Is currently building GatewayX, a venture studio that he plans to bootstrap to $1B+
- Executive Chairman & Founder of GrowthAssistant.com
- ex-McKinsey Consultant
Guest Author: Jesse Pujji
16 years ago he was so broke, he couldn’t afford AWS. Now, his company is one of AWS’s biggest competitors. $0 —> $87 million ARR. Bootstrapped.
Here’s how he kicked Jeff Bezos’ ass
1/ Before Backblaze, Gleb Bludman had already run two VC-backed companies. They did well, but the VC grind wasn’t for him. He knew he wanted his next venture to be different, but what would it be?
2/ Cloud storage, back-up, data – these were all fresh terms for consumers in the late ‘00s. Gleb realized people were accruing personal data, but that they needed a place to backup this valuable information. In 2007, however, it wasn’t cheap…
3/ So he had an idea for a new business.
Provide personal computer backup for folks that were reliable AND inexpensive. The idea for Backblaze was born… But this time they’d go in cold. No backing. Totally bootstrapped.
4/ So, Gleb and his co-founders met up in a one-bedroom apartment, they didn’t even have enough power to run their servers and AC at the same time. Things were already getting sweaty, and they had 2 major issues…
5/ Problem 1 – where does the data go?
Unlike his well-funded competitors, Gleb couldn’t afford Amazon’s cloud storage – he was on a tight budget. While their competitors could LOSE money on each customer, Gleb had to get creative…
6/ Then it dawned on him.
Prices of drives at local computer stores were starting to fall. “What if we bought a batch of those and string them together?” They tried it with 20 1TB hard drives in their first storage pod, and it WORKED! They could offer storage at 20% the cost of AWS. A HUGE win.
7/ Problem 2 – how do you reach customers?
Without $$ for traditional ad spend their team had to get creative. They realized they were accumulating hundreds of hard drives and associated data. So one day, they decided to open source their learnings.
8/ And with their first batch of blog posts Backblaze discovered something…
They became the authority on driving dependability. They became the authority on use-cases. They informed their audience and earned loyal customers.
They even got free press: https://zdnet.com/article/backblaze-uncovers-the-most-reliable-hard-drives/…
9/ Their useful posts, low-cost drives, and efficiency-minded tactics grew their company.
No longer were they 5 sweaty dudes in an apartment with some drives from Best Buy. As their customer base, servers, and company grew, Gleb knew it was time to raise money, but not from the V.C.s he swore off before. It was time to go public.
10/ In 2021 Backblaze IPO’d at $468 million… And it’s still going strong to this day. The 3 simple lessons?
11/ Efficiency is the culture of the company.
Gleb knew there was a solution to the steep pricing of Amazon’s cloud services, but it took teamwork to find the best answer. He created a team of efficient-minded folks. This mindset stays true today.
12/ Find the customer by teaching.
By creating useful content, not only did they build a brand, they built a customer base for their market. They became laser-focused on helping those customers.
13/ Bootstrapping made everything possible.
Because they didn’t lean on outside investment they were forced to find cheaper solutions.
14/ For more inspiring and informative tales like this make sure to sign up for my newsletter: https://bootstrappedgiants.com/join
Check out the original tweet here.
