Growth by Elimination

I have a vision that the team at Outseta should only be focused on four core activities:

• Building great software
• Marketing
• Providing excellent customer service
• Hiring

Everything else is noise.

While there are undeniably other aspects of running a business, my mindset is that we should be trying to eliminate them if at all possible—and if we can’t, we should at least delegate them so we spend as little time on them as possible. 

The underlying idea is simple—the more that we can focus on these four core activities, the faster we’ll grow. And the happier our team and customers will be, too.

It’s worth noting that some of this mindset was born out of necessity—Outseta is one of the more ambitious software products that I’ve seen bootstrapped. We knew from the get-go that ruthless prioritization would be required and that we’d have to do some things differently. 

But as we’ve turned into our 7th year, we’ve embraced this mindset that much more. Let’s trim the fat. Let's take absolutely everything off of our plates that we possibly can. We still have more work to do, but this article shares how we’ve dramatically cut many "necassary" business activities out of our sphere of concern.

Specifically, we’ve all but eliminated:

• Investors
• Management
• Salary negotiations
• Sales
• Budgets
• Forecasts
• Performance targets
• Chargebacks
• Tech stack / time spent integrating tools

Let’s take ‘em one by one.

Investors

When I look back at previous jobs and consider how much time we spent raising money, writing investor updates, and preparing for board meetings I can only shake my head. I fully appreciate the benefits of the VC path, but I also appreciate that it often consumes a company’s leadership team.

This one is surprisingly simple to eliminate—early on we just decided “we’re not going to raise funding.” Our investors are our customers and our early team members who elected to invest their time in Outseta in exchange for equity. 

Rather than raising, everyone started working on Outseta part-time and fulfilled their financial needs by consulting or other means. And we attracted super talented people to the team long before we could afford them by offering everyone equity on the same terms as our founders.

Management

We’ve embraced a management philosophy and organizational design called self-management since the day we started. The idea here is really simple—there’s no hierarchy at Outseta and no one tells anyone what to do. Instead, we hire the best possible people that we can and set them free to contribute to the business in the areas where they are most interested and able. Influence is earned through demonstrating good work and decision making. 

A key aspect here is everyone owns a significant portion of the company, and everyone has access to all information regarding the business. This drives massive alignment within the team.

Salary negotiations

We waste no time putting together job offers, sweating raises, or doing compensation reviews. Instead, we just pay everybody the same. A full-time salary at Outseta is $210,000 per year and everyone can choose to work anywhere from one to five days per week. They can also choose to work to whatever extent they want to earn equity in the business.

I like to call this a “choose your own adventure” compensation model.

While this model may not be for everyone, it’s an incredible filter and has proven to be one of our biggest competitive advantages. People simply select in or out based on whether this works for them.

Again, one less thing on our plate.

Sales

We have almost completely eliminated the sales function at Outseta now, although this wasn’t always the case. In our early years, my calendar was packed with demo calls—it’s what I did with the majority of my time. If I had to do it all over again, I wouldn’t change that—the feedback I got from customers was instrumental to building the product that we offer today.

But about two years ago, we decided to lean fully into product led growth. We focus on getting people to our website, and our copy and a free trial converts some percentage of traffic into customers. A pre-recorded product demo helps a lot, and we invest a lot of time in our in-app onboarding experience.

But sales calls? Sales compensation plans? Quotas? That all flew out the window long ago—it was actually far easier to remove from the business than I expected. I will still conduct demos on occasion, but this has shrunk from roughly 25 per week down to one or two.

Budgets

We don’t waste time creating budgets because everyone on our team knows how much money we’re making, as well as what our costs are. We all know how much everyone on our team makes, and we even publish our non-salary related expenses publicly. 

This is very much in-line with self-management—the number one reason we’ve embraced this structure is to encourage autonomous decision making. You don’t need anyone’s approval to buy something if the expense is reasonable. And if you want to make a large investment, you’ll know that it’s something that should be discussed amongst the team because you have a complete understanding of our financial position.

Forecasts

Forecasts are an attempt to predict the future—if we’ve learned anything these past few years, that’s a tough thing to do. Markets are volatile, pandemics happen, consumer preferences change.

In the earliest stages of a start-up, forecasts are foolish because they’re not based on anything. And when you’re a few years in, you have historical data that should give you a sense of the trajectory of your business. We see that every day just looking at our reports in Outseta—and while we want to influence that trajectory, we don't let loose predictions dictate whether we feel good about our work or not.

Performance targets

Performance targets are most often arbitrary, and I see them constantly driving short sighted behaviors. Instead, we encourage our team to always act in the best long term interests of the business. If we do this over 10 or 20 years, I think that’s a huge strategic advantage.

Here’s more on our case against budgets, forecasts, and performance targets.

Chargebacks

I see so many founders on Twitter obsessing about payment disputes and chargebacks. They spend hours making their cases, which they lose at least 90% of the time. I can tell you I have not spent a single minute in 7 years thinking about chargebacks or fighting these disputes. Seriously!

I’m well aware that some B2C products experience disputes at higher rates than we do, but we do sell to start-ups which is something of a volatile customer segment itself. 

If I look at the monetary value of funds I could have recovered versus the time I would have spent on payment disputes, ignoring these altogether has an incredibly high return on investment. I think most founders realize this, but get sucked into fighting these in large part because they often feel wronged.

Tech stack / Integrating tools

I can honestly say that in 7+ years I have not wasted any time evaluating tools, integrating tools, or generally investing time in our tech stack.

Our development team uses an unsexy stack because it’s what they know—Outseta is .NET on the backend, and a combination of Angular and React on the front end. 

We use Trello for project management—which I’ve used since 2012. We use Wistia for video hosting, which I’ve used all that time as well. We chose Webflow for our website without any real evaluation, based on the recommendation of colleagues whose opinions we respect and trust.

Otherwise we use Outseta for payments, authentication, CRM, email, help desk, and reporting. While Outseta does not have all of the bells and whistles of some of the leading point solutions, I have not once felt that our tech stack has limited my ability to grow our company—rather it's given me time back to focus on the things that do impact growth.

My point is not that you should be trying to cut these same activities out of your own business—your product may require a formal sales process, or raising funding may very well make sense for your business. But there's almost certainly something—and likely several things—that you can all but remove from your plate if you're willing to approach things a bit differently. Finding those areas may be the highest leverage thing you can do for your business.

When I reflect on this list, it’s pretty wild to me—think about the sheer amount of time most companies invest into these areas.

Imagine if you could reinvest that time into the areas of your business that matter?