This is the first podcast I’ve ever hosted and hopefully will host many more as the Growthmentor community grows.
First, a small introduction on my awesome inaugural guest, Kosta Panagoulias.
I stumbled upon Kosta from this Indiehackers interview and was super impressed with his story. Bootstrapping a startup to 7-figures ARR with zero technical knowledge is not easy and can only be done if you put in serious work.
I realized that was a dude that I wanted to get to know better.
So I reached out to him via LinkedIn and told him that I was read his Indiehackers interview and made a bit of an intro on what I was currently working on.
Turns out he really liked the idea behind Growthmentor and he took time out of his busy day to draft up some great feedback for me on a Google Doc.
That really inspired me to keep reaching out to people that I admired with a 1:1 authentic approach. Acknowledging others when they do something that impresses you is the best way to make friendships and build relationships with like-minded people.
Kosta successfully bootstrapped his startup Web4Realty into a 7-figure ARR SaaS startup. Since I am also in the process of bootstrapping Growthmentor, I figured that bootstrapping, and the early-stage challenges thereof, would be a great topic for the first episode of this podcast.
I funded Growthmentor 100% from my own savings and am currently experiencing first hand all of the challenges of trying to scale a capital-intensive startup without the type of cash I’d need to actualize all the ideas I wish I could bring to fruition.
This makes it much more challenging but on the other hand, it’s forcing me to grow and become better at prioritization and become much more efficient as an entrepreneur.
If you are in a similar situation with your startup hopefully this podcast can be of value to you.
Key Takeaways from the Podcast:
- Entrepreneurs are made, not born. Give yourself a chance.
- Solve a real pain point that you’ve validated enough people suffer from
- Spend at least 1-2 months doing hardcore market research
- Call your competitors and pretend to be prospective customers. You’ll be surprised at how much they’ll tell you about how they run their business. This data is priceless
- Launch as soon as possible and use that early revenue to drive further improvements and pay off your initial investment
- Cold calling and cold emailing is the best way to get early traction if you’re bootstrapped. Don’t get distracted by fancy PPC strategies and funnels. Stop being lazy, pick up the phone and SELL.
- Avoid the temptation to get funding, get the fancy offices, and hire like crazy, just because the cool trendy VC funded San Francisco companies do it, doesn’t mean it’s the right approach.
- If you’re non-technical, find a technical co-founder
- Don’t worry about processes being perfect in the beginning, it’s impossible for them to be. Just like a baby can’t pop out of the womb speaking 4 languages. Things need time to develop.
Foti: So Kosta , why don’t you give us a background about who you are and your entrepreneurial Journey so far.
Kosta: For sure, glad to be on your podcast very exciting. I’m a co-founder of Web4Realty. First of all, we’re a SaaS company. We help real estate agents across Canada and the US attract leads build relationships and close more deals through our app that we provide. Like I said it’s a Saas, Subscription Service, my entrepreneurial journey believe it or not actually didn’t consider myself entrepreneurial growing up. You know, I asked this a lot of times to people are entrepreneurs born or are they made? What would you say.
Foti: I’d say they’re they’re made. I mean I see no, Like limiting factor, but I mean definitely there’s character traits which are kind of inherited. you could say like nature versus nurture all day long.
Kosta: but I know it’s funny I ask that because I asked a lot of people that most people say entrepreneurs are born. And I would agree with you. It’s probably a topic for another podcast episode. Are entrepreneurs born or made. I think that’d be interesting. But yeah, I never was entrepreneurial growing up. I grew up first generation Canadian. My parents are both born in Greece immigrated to Canada. Just you know, hard-working blue-collar type of family. So I never really was around business owners entrepreneurs growing up.
I think it was sort of a bug that got instilled in me sometime in University. Guess it was at that time. We’re just have to pay for tuition and make sure money was in my pocket to pay for lunch and going out and stuff. So I started a bunch of little just a little hustles businesses just to make some extra cash and I just remember the feeling of. Providing a service and someone paying you directly for something that you’re offering was just so addictive to me almost like an adrenaline rush. So so that’s when I guess that was a start of my entrepreneurial Journey you could say and then near the end of the University I connected with my current business partner who’s name is Raza.
I met through a mutual friend and we would literally meet up every single Friday night order a pizza and just talk about think of ideas and ways to start a business. How can we make a million bucks or like how can we get a million people to pay us a dollar? Just something we just wanted to do something on our own.
So we literally meet up every Friday and so around this time Raza got is real estate, he wasexploring that field for himself. He teamed up with a successful realtor in our area in Mississauga outside of Toronto and he teamed up with this realtor started doing some marketing for her.
Just playing around he was exploring a website for himself. He wanted to warket himself online. He was going through a bunch of these providers who provide websites and marketing for real estate agent. Just found them to be very outdated overpriced nothing that really, you know, grab his attention and shortly after one of those Friday night meetings, we had he he mentioned this and something just clicked like that was our aha moment.
It’s like, yes, we should do this we can probably do it for cheaper, we could do it better and mind you we had zero technical knowledge and I say like, no technical knowledge. Nothing, but for some reason this idea just clicked for both of us and you know from that day forward we sort of got to work on Web4Realty.
Foti: Nice that’s really impressive you did with zero technical knowledge because I’m looking at the platform now and it’s definitely a technical product. Like how did you deal with that lapse in technical knowledge.
Kosta: It changed a lot since we launched around actually the day we launched officially when I say launch day is like the first day like we started selling on the phone was March 1st, 2011, but how we dealt with that? I mean once we knew like okay, this was the idea. This was the business. We’re going to get into mind you it could have been any business like our heart wasn’t set on internet or software. I’m really glad we stumbled on that because I can’t imagine a better business than SaaS to be honest, but how we dealt with that.
Once we knew that was the thing we just started doing a bunch of research like we had no idea where to start like what we were building what to build. I probably spent the first two months just calling every single competitor pretending to be a realtor and just to squeeze out as much information I can from whoever I have speaking to like how many customers you have, how do you deal with customer support? What’s your onboarding process like, you know things like that and I managed to get a lot of useful information and I’d like a notebook full of notes. I remember. So that was all for the first couple months again. We’re just a bunch of research and then we literally Googled PHP programmer in Pakistan because my partner as well, he’s a Pakistani descent.
We had no money to hire a local developer, which is very expensive. So naturally, we just started to you know, consider overseas. So we literally put that in Google. I think it was like the second search result. We found this programmer. Who started building our product and he’s actually still with us today.
So we got pretty lucky I’d say to find the right person at that time.
Foti: Yeah, I’d say just just from Google right second result. Yeah crazy. Yeah. Well, so no Upwork posting and sifting through 30 different Freelancers or agencies.
Kosta: No, we don’t even know Upwork existed back then pretty sure it was Elance back then.
We had no idea and when I say we didn’t know what we were doing like we had no clue.
Foti: Yeah, so that’s that’s pretty intense and tell me a little about the that first experience of working with working with the programmer and having to figure out what the scope is and how to define it and how to budget your budget. What is the beginning what the end of how much money you’re going to spend to make this?
Kosta: Yeah, good question. So naturally, I was sort of in charge of the finances. I went to school University for accounting and. So naturally I took charge of that end then. I’ve always had a very lean and Frugal approach to to spending using money and it’s definitely applied that over to the business.
But I don’t know it was just one of those things where there’s really no plan. Like, you know when you say like, what was the scope? How did you figure it out? Like we literally just figured things out as we went along it took us about a year to build a product that was like ready. We were confident enough that we should start selling it.
It was terrible and very buggy very glitchy, but we just said, you know what? It’s good enough. And yeah about a year after we hired that first programmer took about a year to build a product that was ready. And then from that point we just started selling and then just you know collected revenue and just slowly started to cover expenses those fixed costs with the revenue we were bringing in.
Foti: Do you remember your first sale?
Kosta: I do it was actually a funny story. So first sale came from a friend of ours are he referred a realtor over so we rather myself so excited we met up with this realtor to set up his site, he was game. So, you know back then I was you know doing sales, I was doing design support everything. So, you know, I designed him a custom header. It’s part of the service and so I showed it to him after we were so excited. Like hey your site is live. He calls us back and he’s like what the hell is this? Looks like a five-year-old created this so I was like, oh shoot.
So yeah, I had to go back to the drawing board. And yeah, that was our first sale not the best sale, but hey, he’s still a client today.
Foti: Absolutely. And in the beginning, how did how did you drive sales and growth? What did your marketing strategy look like early launch.
Kosta: So we were lucky to be we are lucky to be an industry and real estate market. That’s our target customer base and it’s pretty easy to get real estate leads information. Realtors like to plaster their phone numbers and emails everywhere. So yeah, that was pretty convenient and helpful for us at that time. So with that being said like our strategy in terms of sales was strictly hundred percent cold calling cold-calling sending up a little follow-up emails on Gmail and for the first like six months, that’s literally all we did.
Foti: And what year was this again?
Foti: So all that software that exists now to help facilitate that didn’t exist back then.
Kosta: It could have but again, this was just so new to us. We didn’t know like it was just a huge learning curve after like we sort of got our feet. Well, we started, you know to realize like, you know more efficiency tools to help our job, you know, make our job a bit easier.
So we got Salesforce started to use that as our CRM. Started to use some email services to track who’s opening and clicking our emails. So, you know, it helps us make our calls more efficiently. So we started getting introduced to a lot of these efficiency apps shortly after
Foti: what was your biggest challenge after you started getting the first dozen customers or so.
Kosta: Biggest challenge. I think the biggest challenge came after when we had to make our first hire. Our first hire was a sales rep just sort of expedite our growth a little bit. Then really change our approach that are still our main source was still cold calling. We did some more email marketing as well started using a few email marketing automation providers like Marketo and Pardot. So we tried all of those. Well, those are pretty very helpful still are in a business like ours, but I think the biggest challenge was just making our our internal processes just more efficient because it was just so sloppy back then.
Just looking back. But you know, we didn’t know any better. So, you know, it was just a huge learning curve and you know, to be honest, I wouldn’t trade it for anything because the amount that we had to teach ourselves and learn. I think that experience has truly been priceless.
Foti: Yeah, absolutely processes are extremely important and I think that if you actually want scalable growth or you’re not having to cold call every single client it’s definitely needed.
Kosta: That’s something we’re still working on. I mean even till today and just you know to really fine-tune your internal process. I think that’s something you should always work on and strive to improve and get better at especially as you scale and gets very important.
Foti: You mentioned you have a lot of remote staff. How do you manage processes across multiple countries and make sure everyone’s following it efficiently
Kosta: Yeah, so we’ve been remote now for over two years well two and a half years, so we currently have 17 team members across eight different countries no physical office location, and you know to be a remote company, you have to be very data in metric driven and oriented as a company and you require a lot of trust within your team.
I mean that’s I think the most important thing so, you know combine that trust with metrics and data. It’s very easy to see who’s doing what they’re supposed to be doing and who’s not, you know, we’re very lucky we have an amazing team.
I think work ethic is very important as well. When hiring for in a remote setup, you know, when I hire remote I get so many applicants because people sort of see it’s a remote job and they sort of have this thought or Vision in their head like I can work remotely like work from a beach a coffee shop and it’ll be great.
Yeah, but you know that couldn’t be further from the truth when we made the switch, you know, we got rid of our office and started going remote. We had a couple of great employees in the office who just couldn’t do remote work like it wasn’t for them. So, unfortunately, it didn’t work out so it does require a certain type of individual with self-discipline and self-motivation.
I think those are two traits that are very important. But I’d be as a company just answer your question. It’s all of its very being metric oriented is extremely important in a remote setup.
Foti: Yeah, absolutely. Do you have activity drivers that you measure to make sure that your staff is on target? Like how did you decide those?
Kosta: Those came a lot later to be honest, but every department has its sort of their own KPIs and benchmarks that you know, they should hit you know, for example simple ones in sales or like call volume call duration and obviously the number of sales. Itself, it does help that as a founder and you know, it’s our first like core Management Group who’ve been with us since the start like we’ve done every single department. So, you know from sales to support design like we’ve sort of done it all and you know, we definitely have a good idea of what’s achievable and what’s not so we’re not just setting KPIs and benchmarks just, you know, getting a number out of thin air, like, we’ve actually done it. So I think that’s very helpful as well.
Foti: Yeah, I think that’s super important. How are you going to manage something if you don’t know how to do it exactly. As a modern founder to actually know how to do everything in a company and that’s not really possible if you’re a non-technical Founder in the engineering department and product, but in terms of managing your technical team now, Do you have a CTO in charge? Are you are you still Hands-On?
Kosta: So my partner Raza. He’s in charge of the development side of things. Like that’s that’s his side of the business. I’m more on the operational end and finance and HR and sort of everything else other than development. So that’s on him. So yeah, he’s pretty much actually the CTO product owner type of role
Foti: Got it. Like your growth now, I you mentioned that you have over a thousand customers. Like how many users do you have?
Kosta: several thousand actually. We’re actually in a very interesting spot. For the past six-seven years since we launched, we’ve just been playing in Toronto.
So not sure listeners who are in Canada or in Toronto or anywhere in the world just to put into perspective. Toronto is the biggest real estate market in Canada, but it’s also one of the biggest in North America as well. So just in our in this area, there are about 50,000 real estate agents, which is pretty huge and we established a pretty significant footprint in our Market throughout the years, but right now we’re starting to expand into other markets across Canada and the US as well. So it’s a very interesting spot for us where we’re scalability. Now that’s sort of our focus and it comes back to internal processes.
So for the past little while our main focus has just been ensuring that every single Department every single process is just set up for scalability and in doubling tripling our current, you know the number of sales or volume that we would that we that we can do. So, yeah that that’s sort of what our focus is on right now.
I think that’s very nice. That’s just setting up that framework. And make sure we’re we’re grounded in able to scale in every Department.
Foti: Yeah, absolutely the framework and the processes I think are kind of like the mandatory requirement for scale. But then when you have that you have all this choice, right which channel you can use. Like Performance Marketing Facebook ad words and others new quora and Reddit and whatnot. But like from a channel perspective. What’s working well for you guys?
Kosta: It’s a couple things email marketing is still a marketing automation is is definitely really good for us. We do a lot of content marketing as well, which is also very helpful, which does take a while to really start seeing the benefit and the impact of it in terms of content marketing but that does help with us. And we do have a free trial sign up on our website. So, you know, the marketing automation the content marketing drives Realtors to sign up for a free trial on our website, you know, no credit card required and you know at that point our sales team has a just a consistent flow of very warm leads to close.
So that’s sort of the funnel in a nutshell.
Foti: You mentioned you were bootstrapped and that’s something that you’re kind of proud of as a company but. In the earlier days when you really weren’t rocking it like you are now. Did you ever have the temptation of getting external funding?
Kosta: Not really, you know what like back when we started like 2008. Yeah, 2008-2009 sort of was the beginning of the whole Tech craze that was going on like a lot of big companies. We’re getting funded. In those years like companies are coming out like Twitter Spotify Tumblr. A whole bunch of these companies were coming out but I remember back then it was only as it was almost as if the only way to validate your business was to get funding and you know getting that seed round or Angel funding or VC money was what so celebrated as such huge wins for these companies.
Funding stories were getting all the Press on TechCrunch and Mashable and all that but. For us. I mean that was really never a priority like from day one. Our main focus was just on building a sustainable profitable business that’s cash flow positive and you know, since day one that was our focus and still is so we never really got caught up in the whole funding part of it.
Foti: I mean that’s good because now you have full control. You don’t have a boss on top of your heads. And yeah, it’s worked out for you. I mean if you can do it without giving Equity then why not like my opinion is basically like if you don’t need the money right now to keep developing or growing just don’t take it just hold it in wait for as long as you possibly can.
Kosta: That’s for sure. I mean it mind you is literally easier for us to go bootstrapped and not pay ourselves for the first six months because we were still young both still living at home. So obviously that plays a factor. But yeah, I mean that’s sort of a you know, I got your point though.
Like I’m not pro bootstrapping or anti funding in any way I’ve written a lot about bootstrapping through my blog Founderviews as you probably know but it just for my experience over the last Almost decade. I just have never taken a dime from any Source like, you know, I can only speak from my own experiences.
But in no way am I anti funding.
Foti: Well Kosta. Do you have any closing tips or words of advice for non-technical Founders that are thinking of bootstrapping the Sasser or Tech startup?
Kosta: Just do it. You know just stop thinking about it find someone whose technical get a prototype. Just get your feet wet and it all just you know, that’s really what it comes down to I see too many people that just you know, have these great ideas don’t know how to start like just freaking do it.
It’s so easy nowadays to get connected with people and you know, it’s very minimal cost as well. Just to get your feet wet and yeah just comes just a matter of stop talking and start doing.
Foti: I think that it’s never been easier to make prototypes and MVPs. And yeah, if anyone has an idea, I think it’s it’s definitely within the capabilities of even non-technical people. So just do it.. Well, it was a pleasure having you on this first inaugural podcast episode and thank you for your time.
Kosta: Thanks for having me.
Foti: It was fantastic. Take care.