How This Couple Bootstrapped A $1.5M ARR Online Form Builder
Hello! Who are you and what business did you start?
Hey there, my name is Diony McPherson and I’m one of the founders of Paperform. Paperform is an online form builder, but it’s really become its own beast and is used for a whole lot more, like eCommerce pages and appointments. We attract people from all walks of life, mainly running small to medium businesses, who need to create forms, product pages, and rich landing pages that capture data (we call these “landing forms”).
We operate in a fairly saturated market, but we offer a product that is so unique and versatile that we stand out. Our main differentiators are our no/low code form builder which is free text (like writing a doc where you insert elements), being able to create beautiful forms, and conveying your brand extremely well. Our forms end up being super easy to create, engaging, and brand-friendly.
I founded Paperform in November of 2016 with my husband Dean as a lifestyle business - something we could run from home, just the two of us. We just wanted to be able to afford a house, to be honest! However the business grew like crazy, and we made a conscious decision to actively grow the company at the end of 2018 and drop the notion of a lifestyle business.
We’ve now bootstrapped the company to over $1.5 Million in annual revenue, but I can 100% say the biggest achievement for us personally has been hiring a Team that we love working with. Work is a good place to be.
What's your backstory and how did you come up with the idea?
We’re an odd duo. I’m trained as an Ancient Historian and Curator, and Dean dropped out of a computing degree to major in Philosophy and Music before teaching himself to code. I studied psychology and history and ancient languages for almost 5 years before starting a Ph.D. I became depressed during my Ph.D., but I couldn’t figure out why. I’m not usually prone to depression, but I think not being able to see the tangible impact of my work for years got to me.
I stuck with it longer than I should have because I thought everyone around me would be extremely disappointed if I quit. This was during our first year of marriage. Dean sat next to me one day and said, “Hey, you’re not happy and you’re not you. You don’t have to do this; it doesn’t define you. The people you want in your life won’t care if you quit, they’ll love you the same”. So, I quit the Ph.D. and completed a Masters to become a Curator so I could put my skills to use in a way that directly engaged people.
The cultural sector was a massive disappointment in terms of a career path, but it restored my drive nonetheless. Museums and galleries are more often than not extremely poorly managed. I learned the importance of solid operations by working across several institutions and watching administrational train-wrecks in action. I’ve never seen so much money and talent put to waste. It was the perfect place to be at that time, and it also led me to a job with Google Arts and Culture.
I worked there for well over a year managing Australia and New Zealand’s cultural partners and their collections. Google A&C has a range of excellent digital collection tools to help institutions get their weird and wonderful objects out to a global audience. After working there for over a year, Dean (who had been working as a dev for a few companies), started working on the MVP of Paperform every day before work. So, we were both in full-time roles on average to low salaries.
The advice you receive from people putting cash in your hands is invaluable. People don’t give you theoretical ideas of how the product could improve, instead, they demand you make the solution better in a specific way that solves their problem.
He started building Paperform because he had friends regularly asking him to build them a form for event registrations even though they were tech-savvy enough to use existing solutions. They didn’t like existing solutions for three reasons:
1) forms couldn’t handle complex logic and payment rules
2) when they could, they looked like crap and didn’t get folks excited about the event
3) they had strong brands in place and couldn’t find anything that looked like “them”.
So, the idea was validated by the obvious need for a form builder that solved those pain points.
I recall having a moment when Dean showed me what he was working on and asked me whether I’d found with him - I hesitated to say yes because I just knew this was going to be something. Something failing sucks, but something taking-off - that’s scary as hell. But I said yes of course because fear isn’t a reason to not do most stuff (some stuff though, like poking bears, yeah sure). I think that’s how I knew it was going to do well - the fear of success. My role at Google A&C had set me up for running Paperform in many ways, particularly in understanding the dynamic between the user, product, devs, and end-audiences.
Take us through the process of designing, prototyping, and manufacturing your first product.
My first job was to beta test my heart out and provide product dev advice. It was something I was used to doing having worked in the space between devs and users with audiences at Google. It’s one thing to work between devs and users, but when those users have audiences that dynamically engage with the content, you have to think about multiple layers when it comes to UX.
Dean coded for a few hours every morning before work, and then after work, we would talk about where he was at and argued about how the Product could be improved, and get our ducks in a row re admin and company. I say ‘argued’ because we spend a lot of time excitedly arguing in a very positive way. We don’t always agree, and that can be very fun and helpful for developing something that people actually need. No one is blowing smoke up your arse - you get a candid response to your ideas. That means you have to justify why you want a Product to function in a certain way: sometimes it helps solidify your thinking and other times it forces you to accept that you’re wrong quickly. We also agree on a lot, especially revalues, so that makes founding with each other easily.
We launched an MVP (we prefer Minimum Lovable Product actually) on Beta List in August 2016. There were only a few months of development before we got it into people’s hands. Get your Products out to consumers as fast as you can! That gave us some solid feedback, but admittedly we received the best feedback later when we launched to paying customers the following December. The advice you receive from people putting cash in your hands is invaluable. It is vastly more practical than non-paying beta testers. People don’t give you theoretical ideas of how the product could improve, instead, they demand you make the solution better in a specific way that solves their problem.
I always say Dean is the talent, and I’m the manager. As Dean was working his butt off to produce a great product, I was setting up the business. A good product is not a viable business. I have seen and heard of many great products failing because people failed to nail ops, particularly when it comes to liability. I’ve seen successfully bootstrapped companies that generate millions in ARR fail their due diligence during acquisition because they didn’t sort their ops out.
My job was to set up the best company structure we could and to manage our legal and financial liabilities. I love that stuff. My brain looks for potential problems and then gets excited about making sure they never come to fruition. Before generating revenue, we invested approximately $5K of our own money registering our company, getting some equipment, buying some tech tools, buying off-the-shelf legal docs, and securing trademarks.
Describe the process of launching the business.
During beta testing we had someone from AppSumo reach out to us and ask whether we wanted to launch Paperform on their deal site. We would sell a lifetime Pro subscription to Paperform for a flat fee of $39. Given that their customer base is huge, we knew that even though we’d give up 70% of the sales to AppSumo, it was worth it for several reasons:
- We are excellent at a lot of stuff, but not marketing. We needed someone to nail our launch marketing without paying them.
- We knew we would get a large number of paying customers all at once who didn’t shy away from feedback (these people live to try new software).
- At a 30% cut, we’d walk away with a decent chunk of capital to be able to quit our jobs and work on this full-time.
So, we said yes, and set a launch date for early December. Funnily enough, AppSumo ended up launching a few days early by mistake. I’ll never forget getting a notification that we were live - I was checking my phone while on the loo, which was lucky because I just about crapped my pants. We were up almost 24 hours a day supporting these new users and engaging leads anywhere we could.
We sold 2740 deals in a matter of weeks and generated a total of USD 106,860. Our cut was $32,058, which was great capital to kick off with, but more importantly, our name and product got out there fast. People were talking about us, especially on Product Hunt. We were hunted and ended up in the #2 position and generated a lot of activity and ongoing leads.
The launch generated a snowballing buzz for us. AppSumo users fell in love with us, and they told everyone they knew about us. We grew organically via word of mouth, and by partnerships that came about as a result of the launch, and we grew at a rate of approximately 10 - 20% month on month for the first two years.
The following March (2017) we quit our jobs and decided we had enough revenue to work full-time on Paperform. It wasn’t quite enough revenue to cover our salaries, but it was trending in a low-risk way, so it wasn’t as scary to jump off of that cliff as it sounds. I’m a huge believer in the need to assess finances to get a pulse on the health of a business, particularly for bootstrapped companies.
Paying ourselves a salary on an ongoing basis was one of the first markers of success for us, especially because we started this business to support our lifestyle. We didn’t care for raising funds or bank loans - we wanted to live debt-free and run our lives. We fronted the costs for launching the business, and then paid ourselves back when we were financially stable. It was the best decision we’ve ever made. We’ve never had to worry about stakeholder’s opinions.
Since launch, what has worked to attract and retain customers?
The method by which we attract and retain customers has changed as we’ve grown, but at our core, we’ve always had two clear principles for growth: 1) creating a high-quality product, and 2) excel in supporting our customers. After all, if you are running a Software as a Service modeled company, you should at the very least be nailing product and supporting it extremely well. For Paperform, that will never change.
Learn the value of discipline. Founder work is 99.99% unglamorous and tedious. If you can appreciate the value of getting mundane or grueling tasks done without anyone else acknowledging them or praising you, you’ll go far.
By starting with those values, and by not having a freemium tier, we’ve been able to invest our resources into really being there for our customers. Early customers became our champions. They shouted our name from the rooftops and were invaluable for growth. We created a referral program to encourage them, as well as an Affiliate program.
As a result of being engaged and having a kick-ass product, big-name companies wanted to partner with us, and they exposed us to their user-base, which in turn generated quality leads. Not long after launch, Zapier reached out to us after seeing us launch on AppSumo and asked if we wanted to be a partner, meaning that people collecting data using Paperform could then send that data to hundreds of other apps once collected.
It also threw us into their marketing campaigns, which caught the attention of Entrepreneur Magazine. Oftentimes people are too narrow-minded when it comes to marketing and growth. They only see obvious channels as opportunities and they forget that top-notch customer service can lead to rich relationships and invaluable opportunities.
This kind of organic word-of-mouth growth worked for us for the first two years. By the end of 2018, we were growing more than we had planned to, and we realized that this was no longer a lifestyle business. We could either put the breaks on growth somehow or lean into it hard. Being ambitious, we decided on the latter and became much more intentional with our growth strategy.
We engaged a fantastic growth consultant, Vlad Shvets, who has huge experience in the kind of strategies that can work well for businesses like Paperform. We actually managed to convince him to join our Team, and he now heads up our Growth efforts alongside our Growth Manager, Vrinda Singh.
Vlad and Vrinda have worked hard and tried and tested a lot of marketing experiments. Now that we are bigger and it’s not feasible, and just not scalable, for Dean and I to have close relationships with individual champions, we’ve grown into more suitable growth methods for our size. We work hard on creating content that makes an impact, as well as looking into Adwords. Adwords are extremely difficult to do well, but if you figure out what works for your business, they are the boss. The other thing about Adwords is that it’s a method that you need cash to experiment with, so I’m not sure that I’d recommend it if you are just starting.
Product partnerships still play a huge role in our growth. For the first time now, we are seeing Paperform being added to other products, and that has been brilliant for engaging new audiences. We’ve actually got some very exciting product launches coming up this year, so watch this space! Product partnerships can be complex and take time, but they often result in an evergreen lead generation play that brings lasting ROI.
Customer Success plays a huge role in customer attraction and retention. We invest in wonderful nerds who are obsessed with Paperform, and not only want to solve our customers’ needs but take it to the next level by coming up with creative solutions. Paperform is an extremely robust tool - we support complex Excel-style calculation functions, which means your form can do just about anything you want it to. Also, if our extensive customization options aren’t enough to satisfy your design needs, we support you in using CSS and HTML to get you there. Never, ever, underestimate the power of good ol’ fashion customer service. It’s a lost art, and consumers miss it.
How are you doing today and what does the future look like?
In March of 2019, we hired our first employees (other than us!). We had been running the business on our own for two years and have decided to grow this thing, we knew it was time. That was a scary moment for me because I was protective of what Dean and I had. Not so much the business - we can always start another business, but I was worried about what success and growth might do to our dynamic. I absolutely love working with Dean, and not because clearly, I think he’s hot stuff, but because I genuinely enjoy the day-to-day experience of working alongside him. Fortunately, building out a Team has only added to that experience.
We’ve managed to hire a group of (soon to be) 15 people who are the smartest, kindest, and most disciplined people we’ve ever worked with. We started hiring at around $25K MRR, and two years later we’re approaching $130K MRR. We’re extremely happy with that growth - we grow a little slower than some funded unicorn SaaS products, but still at a fast pace and one that allows us to ensure that our operations are supporting future growth well. I’m mostly enjoying the challenges that come with growing a multi-corp (we now have companies in the USA and Australia). I love running the machine.
As a bootstrapped company, we need to make a profit to have a runway. We’re always profitable at the end of the fiscal year. The downside of this is a lot of government-funded R&D schemes rebate your deficits, so we don’t qualify for R&D grants. That’s frustrating. Another downside is publications aren’t as interested in promoting you if you’re not funded. They want the funded unicorn glamour story most of the time. That pisses me off because I see a lot of excellent examples of business building in the bootstrapped community. Having said that, we never say never when it comes to funding. There are some great investors out there. We’d be open to it if we had a good way to spend it sustainably.
There are a lot of upsides to bootstrapping. If you want to fund, when you successfully grow a bootstrapped company past $1M ARR, you have a self-validating business. Investors will beat down your door to fund you. We have at least one well-established investor reach out to us about Paperform per month. If and when we need funding, it’s there. If your business can fund its own growth on an ever-increasing scale, that’s a clear sign that you have a valuable and successful business.
We still grow at a rate of between 3% to 10% month on month depending on seasonality. Covid has boosted our sales, with some months seeing 3X the growth we had anticipated. We’re a sticky product too, so our users tend to stay around for a while. Our plans cost between $15 to $99 per month and we have an LTV of approx $900.
Where are we headed? We try not to plan too far in advance - so other than our vision and mission “to democratize digital creation” we don’t have a 5-year plan. Why? Because we’re a software tool. Tech changes quickly, and the world can change even faster. Agility is one of our greatest strengths as a SaaS business.
For the foreseeable future (yes, we do have a clear 12-month plan!), we’re going to expand operationally in the USA (we started in Sydney, Australia), and we’re going to be focusing on some exciting product launches with very established players in the no-code and creative tool space. We’ll also continue to invest in our Customer Success Team, led by the fearless Jozella Roque, because nothing beats that one-on-one helping hand when it comes to engagement and retention.
Through starting the business, have you learned anything particularly helpful or advantageous?
Yes, every day teaches us something new. If I had to pick my top lessons, they would be:
- Managing Stress and anxiety can get easier. If you learn to manage stress in healthy ways, you develop a tough shell. The things that kept me up at night when I first started, like Cease and Desists and hiring, are water off a duck’s back now.
- Don’t wait too long to get your product in people’s hands. Get your minimum lovable product out there and get people to pay for it. It’s a surefire way to get feedback that will develop your product into a long-term winner (or illustrate that it’s dead in the water).
- Learn the value of discipline. Founder work is 99.99% unglamorous and tedious. If you can appreciate the value of getting mundane or grueling tasks done without anyone else acknowledging them or praising you, you’ll go far.
- Ironically, don’t listen to too much advice, at least not as your first port of call. Learn how to hone your instincts by examining patterns of behavior and research data, and then make your own assessment and decision first. Then you can look at what other people are saying and doing. If you are always forming your plan and strategy based on what other people have said or done, you’re living in the past. You can’t truly innovate that way.
What platform/tools do you use for your business?
- Slack - Slack keeps our global, remote Team in touch across multiple timezones. Have a mix of work and fun channels. It’s a great chat tool.
- G Suite (Business) - we use Docs/Drive for collaborative work that needs external input and also rely on Gmail and Google Calendar for meetings and comms.
- Notion - an excellent no-code tool for dynamic documentation. We use it as our internal “Wiki”, and manage a lot of our internal planning and documentation here.
- Asana - this project management tool is used for individual tasks, as well as managing large projects.
- Intercom - we use Intercom as our customer CRM and live support tool. It is on the more expensive side of life which can be frustrating, but we haven’t found anything else as good for our needs, not yet anyway.
- ProfitWell - this provides financial insights and metrics for revenue. We’re able to analyze data and make decisions about how to approach seasonality and our general growth strategy, as well as analyze churn and retention.
- Stripe - payment processing! Collect your hard-earned cash and put it in your piggy bank.
- Xero - bookkeeping software that is very easy to use. If you don’t know what your money is doing, your business is going to fail. Xero reports have been extremely helpful.
What have been the most influential books, podcasts, or other resources?
Tony Simmon’s ‘Disciplinn’ podcast is excellent (and not just because I’m on it!). I jumped in for an interview because I was impressed with Tony’s exploration of all facets of business, not just growth.
Learn how to argue well. Surround yourself with people who are smarter than you in their profession, and allow them the room to disagree with you. Let go of your ego, but fight for things you care about.
Relationships I have had with mentors in my life have had the greatest impact. Look around you and see who impresses you. Seek them out and watch how they operate or work alongside them.
I only read old-school fiction, and peer-reviewed articles (any discipline, but most ancient Hebrew and Greek stuff), and the Bible, so I’m not much help there. Data makes me tingly. I like reading data and analytics.
Advice for other entrepreneurs who want to get started or are just starting?
Okay, look, it’s not sexy but for goodness sake get your house in order! If you are serious about your business, nail a company structure, sort out your company establishment, do research when it comes to selecting a business name, and seek to protect it early on. Think about how you are going to manage and record expenses. Consider at what point you should get insurance. Legal, finance, and insurance are the backbone of your business. Spend time organizing these well.
Most importantly, hone your own instincts. Learn how to rely on your own decision-making abilities. Consider the experiences you have had and are having and learn from them. Practice critical thinking. It’s becoming a lost art and contributing to a loss of common sense.
Learn how to argue well. Surround yourself with people who are smarter than you in their profession, and allow them the room to disagree with you. Let go of your ego, but fight for things you care about. Businesses need at least one founder who cares too much - someone who hates to see the little things not done right and who is willing to hold on to their values like a dog with a bone. But they need to do this with grace and humility.
Are you looking to hire for certain positions right now?
Yes, we’re looking to fill two roles:
- Content Writer, Full-Time, remote
- Customer Success Specialist, Part-Time, remote
Where can we go to learn more?
If you have any questions or comments, drop a comment below!
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