We Launched & Validated Our Startup With Only $20K

Vasco Monteiro

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Published: June 11th, 2022

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Vasco Monteiro

Founder, Vettted

$100

revenue/mo

Founders

Employees

Vettted

vettted.com

from Lisbon, Portugal

started February 2021

$100

revenue/mo

Founders

Employees

Discover what tools recommends to grow your business!

Discover what books Vasco recommends to grow your business!

How to Win Friends & Influence People Dale Carnegie

Want more updates on Vettted? Check out these stories:

Hello! Who are you and what business did you start?

Hy, my name is Vasco.

I’m the founder of Vettted, a place where you can outsource your digital marketing efforts through productized services.

I’m 24yo from Lisbon, Portugal. I and my co-founder Afonso have been working on the business in my parent’s basement for about a year now.

Here’s a picture of us in that basement:

We’re not just building another marketplace.

Vettted is the place to outsource marketing efforts to pre-vettted marketers through productized services.

It’s a platform built by freelancers for freelancers - which is one of the reasons why talent gets to keep 100% of what they earn. We take 0% in fees.

So far I’ve personally invested about $20k into the startup and that includes:

Development costs
UI/UX designer
Domain + Hosting
Azure Cloud Services
Miscellaneous costs (i.e. accounting, legal, others)

You can watch a more detailed cost breakdown here:

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We launched about a month ago and so far we’ve made a whopping $245:

We’ve also managed to gather quite a few faces of talented marketers from all around the world:

Building a marketplace is one of the hardest business models you can get into, but we’re extremely confident we’ll make it work.

We just need to be consistent and keep focused on the vision.

What's your backstory and how did you come up with the idea?

I got into online marketing in 2014 from a guy named Alex Becker (if you’re into SEO and marketing you probably know of him).

I recorded a video on my journey as an entrepreneur in 2014:

I talk about what I did and how I got the money to fund my new venture, Vettted.

It’s quite a boring video, to be honest, so here’s a quick breakdown of what I did:

Sold Minecraft maps & 3d models
Sold e-cigarettes
Did dropshipping (haven’t we all)
SEO for local plumbers, electricians, plastic surgeons, and dentists
Launched an SEO agency
Started marketplace freelancing
Started an SEO productized services brand/agency (built a website, email list, Facebook group, SEO training, and SEO software)

And for the past year, I’ve been working on Vettted.com!

All that while documenting the process every week through short video snippets:

Most recently, I started to document the process with long-form content on my YouTube channel.

I just put my phone on top of my mic stand, hit record, and talk about whatever it was we did that week.

I do this both to hold myself accountable, and so that in the future I can look back at these videos and reminisce.

I came up with the idea of building a marketplace because I had been working on freelance marketplaces since 2016.

I noticed a lot of things wrong with both the industry and how marketplaces themselves were set up, namely:

Lack of transparency from freelancers (you don’t know who’s behind the screen. There’s no identity verification process).
You don’t know what you’re buying (no samples provided before the purchase).
Too many fees. Freelancers should keep 100% of their earnings, not give a 20% cut to the platform. Without the talent, the platform wouldn’t exist. Freelancers are the most valuable asset of a marketplace, so asking them for 20% of their hard-earned earnings is wrong.
Low-quality cheap services (there are way too many low-quality $5 to $10 services).
Not enough talent vetting (a marketplace that does this very well is Toptal).
Trying to focus on everything. A marketplace that does this is Fiverr. You can buy and sell anything there. Our goal was to pick a niche and be the best in that niche. I felt like there was a need for that.

For this last one, much like all the companies that spun from craigslist, like Airbnb and Tinder, I wanted to spin something off of Fiverr/Upwork (i.e. generic marketplaces trying to please everyone).

So instead of building a marketplace that pleased every niche, we focused on digital marketing only.

Here are some companies that successfully sprung from Craigslist:

Fun fact: there are already companies niching down from Airbnb and Tinder.

For instance, Wander which is an Airbnb-like company but for office spaces.

With all of this in mind, I knew I could build something better from what was already out there.

Take us through the process of designing, prototyping, and manufacturing your first product.

Looking back at it now, it was a great learning experience.

I’d never done it before, and even though I had intuition on what I needed to do, a lot of things were just done based on the intuition I’d gathered since working online since 2014.

I have a video on the step-by-step things I did, from designing, and prototyping to launching.

It’s over 365 days of content lumped into a 7min video. You can watch it here:

https://www.youtube.com/embed/oZmk0Gayfnc

But let me take you back…

I started designing the first wireframes on Figma.

Here’s a collage of the first-ever mockups:

We eventually hired a designer to make both the UI and UX look great.

Ironically I found him on Upwork. He was a UI/UX designer from Dubai (a talented guy!)

I could write the whole story here, but I already recorded this video which goes through it all (in detail).

In these initial stages though, we were in the “trenches” working hard every day to get the project off the ground.

When Afonso (the cofounder) didn’t come to the basement, we worked via zoom:

Don’t get me wrong, we’re still extremely deep in the trenches…but different ones now I guess.

Describe the process of launching the business.

Launching was somewhat anticlimactic.

Before starting the business I had this idea in my mind that I’d be able to leverage my current personal brand.

Personal brand stats:

Niche: SEO
Building since 2018
Email list size: 1000 people
Facebook group size: 1200 people
YouTube channel: 295 subscribers

These aren’t by any means big numbers, but as we all know, it’s not just about the numbers themselves, it’s about how engaged the community is.

Having a personal brand is such a HUGE advantage when creating any type of business.

People connect with people, and if you’ve built trust and rapport throughout the years with your following, they’ll support you with anything you do.

Having worked with thousands of clients throughout the years, my plan was simple:

Launch Vettted (i.e. tell my clients about it, share it on my email list, Facebook group, and SEO YouTube channel)
List my services
Funnel all my past and current clients + my brand to it

However, I learned quickly that I wouldn’t be able to leverage my brand…

This was a BIG hit to my plan. I had to start from 0.

The brand I had built over 4 years was worthless.

Let me explain…

There’s quite a big issue here. And it’s somewhat complex.

Here we go:

So I have a decent following on Facebook and YouTube from my SEO personal brand that I’ve worked over 4 years to build…I have a large email list and a lot of people that follow my work and enjoy working with me.

As you can imagine, this personal brand is a very valuable asset.

It generates me multiple 6 figures per year (not flex at all).

Anything I recommend or sell to the audience, I’ll get guaranteed sales/sign-ups/views/likes, etc… Like any other “influencer” whatever he/she says, carries some weight.

This is because of the trust I’ve built over the years with these people.

Unfortunately, I wasn’t able to leverage my network (I’ll explain why in a second).

I can’t funnel all of these people that I have trust and rapport with to Vettted.

The more you learn about your idea, the less confident you become because you realize things are way more complicated than they seemed at first.

If I could, then Vettted would most likely already have a ton more users.

Now…why can’t I leverage my personal brand?

It’s because I currently work on another freelance marketplace in which the CEO told me that if I were to do so (leverage my brand) he’d ban me.

And it’s that other marketplace that’s financing Vettted.

As of now, all the sales I get on that marketplace, go straight to build Vettted.

Now you may ask.

“Why don’t you just transfer all your services from that other marketplace to Vettted, and then tell your clients about it?”

It’s not that simple.

It’s like asking me to stop a multi-six-figure a year with a flick of a switch. One day it’s a thriving business generating six figures, the other it does $0.

Eventually, I’ll have to do it, I’ll just need to be tactical about it.

But enough about that.

I’ll eventually have to suck it up and leverage my brand.

I’ll lose some money in the process, because his platform does bring in some new traffic to my “bubble”, but that’s the risk I have to take.

Now you might also ask why I haven't taken that leap yet.

Valid question.

I’m waiting until Vettted is somewhat more established before I do it since I don’t want to lose that stream of income from the other marketplace just yet.

Since launch, what has worked to attract and retain customers?

Since we’re vetting every marketer that applies (to make sure we keep the quality of the platform), growing the supply takes time.

We can’t just spam Fiverr/Upwork freelancers’ Facebook groups because the quality is just not there.

We don’t want a million average freelancers, we want a thousand great ones.

Connections are more important than money. If you know the right people, things are much easier.

Before starting a marketplace business I read a lot of Lenny Rachitsky blog posts. He’s the go-to guy for marketplace-building insights and growth tips.

According to him, direct sales (i.e. organically reaching out to people and asking them if they want to join) is the most commonly used tactic for supply growth on successful marketplaces:

So that’s what I did, and am doing.

Since I couldn’t leverage own brand I built for the past years (as explained previously), I had to start from scratch.

Here’s what I did to grow supply:

Manual outreach to already established freelancers on other marketplaces (i.e. Upwork, Fiverr, Malt.fr, RemoteOk, UnicornFactory.nz, dynamite jobs)

These marketplaces were chosen because people show their faces there, and that’s exactly what we’re looking for: people that aren’t afraid to put themselves out there and associate their faces with their work.

Many of these marketplaces have systems in place that make it hard for you to find a freelancer’s contact info. So I had to be clever in my approach at times.

Facebook groups outreach

I did a post on a Facebook group for digital nomads (paid $30), in which I offered $100 to anyone that registered on Vettted >> signed up as a professional >> posted at least 1 service.

The results were great.

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Moreover, I made a lot of new connections, which will be extremely valuable in the long run.

Twitter outreach (i.e. producing content around freelancing, and following freelancers + DMing them)

For this, I used my personal Twitter account. People connect better with people, so using @vettted would not be beneficial.

Twitter can be an extremely powerful marketing tool.

The formula for “success” was as follows:

My goal was always to get people to register on Vettted, and for that, I tweet about 2 things only:

Progress updates for Vettted (i.e. new features, revenue updates, hardships, milestones, etc..)
Freelance content (i.e. tips for marketplace freelancers, how to become a freelancer, freelancer best practices, etc…)

With that, I manage to achieve the following numbers:

Moreover, regarding the freelance content, I do also produce YouTube videos to help freelancers:

My goal with this is to help freelancers for free and then get them to register on Vettted.

The masterplan:

Give away all the secrets of marketplace freelancing, for free
Build a trained workforce and following of marketplace freelancers
Offer them a platform to help them succeed (Vettted)

All of this is done to build a personal brand and become an authority around a niche: marketplace freelancing.

How are you doing today and what does the future look like?

We’re not profitable yet, in fact, we lose about ~$2k per month.

Here’s a breakdown of our costs today

Part-time full-stack senior dev: €1200/mo
Azure: $150/mo
Miscellaneous: $500/mo

So we’re spending around $2k per month to run the business.

Our metrics so far:

Gross merchandise value (GMV): $2450
Revenue: $245
Number of users: 287
Number of sellers: 65
Active buyers: 3

Since we’re bootstrapped, it’s always a good idea to look for programs that give startups money.

For instance, Microsoft Azure has a startup program where they give $5000 in credit for a year on their services.

This has been great for us as it offsets a big cost we’d have with servers while we don’t generate much revenue.

Our short term goal: get more buyers and sellers on Vettted

Our long term goal: make Vettted the place to quickly outsource one’s marketing efforts

Through starting the business, have you learned anything particularly helpful or advantageous?

I learned that hiring (talented) developers are expensive.

I also learned that people are ruthless in business (as they should). And that they’ll do anything in their power to take you down (i.e the example of the story I mentioned above about the other marketplace I work on).

Connections are more important than money. If you know the right people, things are much easier.

So don’t be afraid to message people because you think they won’t reply. They will.

And those connections will be extremely valuable.

Having been “building in public” for a year now has been great to get the attention of some of the people I wanted to connect with.

So don’t do things alone, connect and talk to people, it’ll make your journey much easier

Business is hard.

But it’s all worth it. Our time on earth is limited and you wouldn’t want to be old and think “what if I had at least tried”?

If you won’t do it, then who will? And if not now, then when?

What platform/tools do you use for your business?

My favorite tools are Slack, Notion, and Discord.

Slack is a must for communication. Super intuitive and a great place to gather the team.

Notion is a must for project management. We all have access to the board and it’s extremely well organized so we don’t waste any time.

Here’s how it’s looking today (if I scroll down there are a lot more cards).

Discord is great for community management.

It’s a fantastic place to gather all the platform’s users and give them product updates, tips on how to succeed, vote on upcoming features, and overall just chat and engage with the community.

A strong community is a great asset for any business, hence why from the start we focused on building one for Vettted.

What have been the most influential books, podcasts, or other resources?

I’ve read a lot of books and spent hours listening to podcasts.

To be honest, none of that’ll help you if you don’t implement the things you learn.

The most influential book I’ve ever read was “How to win friends and influence people”, by Dale Carnegie.

It’s such a timeless piece and in my opinion, the best self-improvement book was ever written.

The entrepreneur I look up to and have learned a lot from is Alex Becker. He can be a bit goofy at times but he's been in the industry since 2011. He knows his stuff.

Advice for other entrepreneurs who want to get started or are just starting out?

My advice for entrepreneurs who want to get started or are just starting out is just does it.

It’s clichê I know, but that’s all it takes. You just need to get started doing stuff.

Lock your phone in a drawer and focus for however many hours you can. Just get stuff done.

You’ll see little progress at the beginning but it’ll compound over time.

You only learn by doing. You can watch videos and read blog posts like this one, but this won’t get you far. The best way to succeed is to do IT.

Something else I recommend you familiarize yourself with is the Dunning-Kruger effect.

It means that when you start with an idea of what you want to build, you’ll be super confident about it because, in reality, you don’t know anything.

The more you learn about your idea, the less confident you become because you realize things are way more complicated than what they seemed at first.

I went through this, and currently feel as if I'm just leaving the “Valley of Despair”.

So if you ever feel like you want to quit, just remember that it’s normal and that you’ll feel defeated at times.

But as an entrepreneur, you just have to push through it.

And remember:

If you’re not staring now, then when? If you’re not going to do it, then who is?

Life’s (really) short, take chances, it’s always worth it. Even if you fail, you’ll learn more than if you hadn’t tried.

Are you looking to hire for certain positions right now?

I want to keep costs as low as possible. So right now I’m doing a little bit of everything to not have to hire anyone and increase costs.

As of now, the team is:

Me
Afonso (business partner and software dev - not full time)
Luis (software dev - part-time)
Matilde (uni student helping us do outreach - part-time)

We are looking to hire a full-time junior full-stack developer.

Ideally from Portugal, since we like to connect with people in real life and create real connections (i.e. go for a coffee, work together on a coworking, go out for dinner, etc…)