The Bootstrapped Founder

[Music]

Welcome to the Bootstrapped Founder. My name is Arvid Kahl and I talk about bootstrapping,

entrepreneurship and building in public. Today I will talk about why building in public,

as great as it is, might not be for you. And before that, let me thank the sponsor of today's

episode. One thing that always confuses me in my own businesses and it still does to this day,

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profitably. That's usepinto.com/learn. And alright, now let's get to our main topic today.

In the world of entrepreneurship, there's a growing trend towards building in public,

the concept of sharing the journey of creating a product or business with a public audience.

And I'm a big fan of this approach to build something meaningful in front of those whom

it matters to the most. But it is just one way out of very many to get where you want to be.

And for some, it may not always be the best approach. Building in public is about honesty

and transparency. So even because I'm an advocate for this way of running a business,

I want to share a few reasons why building in public might not be the right choice for you

or your business. The first reason revolves around an entrepreneur's personality traits,

mostly their attitudes towards public engagement. Building in public is obviously not a very private

act. The entrepreneurial journey that we're all on often requires stepping out of one's comfort zone

and it's important to acknowledge individual strengths and limitations of each founder.

Some builders are almost exclusively technically minded. They might prefer to immerse themselves

in the craft of building a product rather than talking about their work. And I certainly remember

thinking and acting just like that early in my career as a software engineer. I thought that

being an introvert, who I still think I am, meant that marketing, which includes talking about my

founder journey, just wasn't for me. I would rather code. I would rather build a product.

But contrary to popular belief, being an introvert does not necessarily mean that you cannot succeed

in building in public. Introversion and extroversion are not decisive factors here.

Instead, it's your ability and willingness to interact with people who care about the same

things as you. It becomes an order of magnitude easier to share your story with people who already

know the vocabulary. I've found that even the most introverted founders glow up when they're

talking to an audience of their peers about things that they all care about. But for some people,

this is just too much. If you absolutely hate communicating with others about your work and

its potential benefits, or if you prefer solely focusing on the technical aspects of your work,

building in public may prove to be a distraction rather than a boon. Your inability to build in

public also does not mean that you cannot be successful in business ever. You just need to

consider other marketing strategies that align with your personality traits and business goals.

Because building in public effectively is marketing. Maybe marketing yourself,

marketing your product, marketing your idea, your vision. It is giving something to the market.

So for that, you could just consider partnering with a more extroverted co-founder or hiring a

dedicated marketing expert, a freelancer maybe. There are ways to bridge this gap. But make sure

that you're not falling prey to what Michael E. Gerber calls the entrepreneurial myth.

You can't run a business on technical chops alone. There's always an operational and a business

development part to any successful business. Don't skip these just because they're harder than

building. They're just as important. And you kind of need to learn this as a founder. You need to be

able to do these other things too. And since we're already talking about the business,

let's stick with the business. The second aspect to consider here when you're pondering if building

in public is for you is the nature of the business you're building. Some kinds of businesses

inherently lend themselves to building public businesses, to the public building public process,

while others may better be suited to a more private approach. Businesses that thrive on

community engagement, or that are referral based or have a strong collaborative aspect,

they're often way more conducive to building in public than others. Most businesses in the

educational and healthcare sector, for example, or those involving open source technology,

coding, software engineers, they often thrive when built in public because they rely on a

sense of community and collective effort, both in how their progress is made, how their work comes

to be and how their marketing happens. The audiences you work with there tend to recommend things to

each other. Word of mouth is a central marketing mechanic in these fields and building in public

can amplify that significantly. But on the other hand, if your business provides a significant

competitive advantage, a competitive edge in a hyper competitive market, it might be better to

keep some aspects of it private, maybe the whole thing, maybe even its existence. A business that

provides exclusive insights might lose its competitive advantage if these aspects, these

insights are shared too widely. Imagine a tool for day traders that highlights the most promising

real time deals, investments or something. If I was a trader, I would not want to tell my peers

about this tool. It would strengthen my competitors. Why would I do this? I would keep this powerful

tool secret to maximize my profits. Shareability matters and you need to figure out just how

shareable your business is. If you serve competitive players in hyper competitive markets,

you're probably better off building a brand of being elite and exclusive. And while building

in public could still be an option, it would require a much more selective and strategic

approach in terms of what you choose to share. Finally, there's the problem of copycats. We're

talking about people having a competitive advantage. Copycats, that could be one. The third

reason to consider not building in public is when you lack a strong business moat. A moat is any

business' ability to maintain its competitive advantages over its competitors over time.

These advantages could be anything, either access to money, capital, network, connections,

industry knowledge or having a unique product that's difficult to replicate. As long as the

thing you have is not cloneable in a few hours, it is likely a moat. But if your product can easily

be copied and you lack other competitive advantages, sharing too much information publicly

will invite clones and competitors and that potentially damages your business. This risk

is particularly present for first-time founders without any prior expertise or connections or

reputations in the industry that they're serving. In such cases, it's advisable to establish a solid

moat before starting to build in public. And this sounds hard, but it's easier than it seems.

Particularly in industry niches, really small niches, communities will reward the people who

contribute in them with reputation and connections. So that just means that if you're part of a

community over time, you will build the moat of having a good reputation for your expertise,

for example. And then building in public, the process of starting to build can itself create

a moat over time because it builds trust and establishes this reputation as somebody who cares

about the community. However, this strategy pays off only in the long run. It will take a couple

months, maybe a couple of years to be part of these communities to get anywhere resembling a moat if

you have no prior moats in that industry. And it is useful to have immediate competitive advantages

from the start to protect your business in the short term. That said, there's nothing wrong with

having competitors, even copycats. That's just how business works. You have a good idea, other

people will try it. The industries that we serve are large enough to support multiple varieties of

similar products. And our customers, they're smart enough to pick the product that keeps solving

their problems, that iterates, that builds new functionality. You don't necessarily need to be

the only product in this space. However, the closer the thing you're selling is to a commodity,

something easily replicated, the less useful it will be to build in public around that business.

So while building in public has many benefits, it's not a one size fits all strategy. You will

need to consider your personal comfort level with public engagement, the nature of your business,

and your business's competitive advantages before deciding whether to adopt this approach of building

in public. It's also crucial to remember that building in public is not an all or nothing

decision. You could choose to share certain aspects of your journey while keeping others private,

depending on what best aligns with your business strategy and personal style.

I've actually seen people build businesses in public without telling other people exactly what

business they're building. This is pretty strong in the Amazon e-commerce merchant space where people

just share insights, maybe even numbers from their business, but they won't tell you what they sell

because that would be super easy to be cloned. But you can still share the journey. You can still

share your graphs. You just don't tell people who you are or what you build. It's pretty interesting

that building in public can be seen from this kind of level of abstraction too. You don't need to

share everything. You need to share the things that are interesting and instructional and

educational for the people around you to find meaning and value in what you share, but you don't

need to give up everything. In any case, entrepreneurs should avoid thinking of building in public as the

only way to achieve success. Many successful businesses have been built privately and there

are numerous other effective marketing and branding and outreach strategies available.

Building in public is a good one. It's one that I like, but it's not the only one. And if it doesn't

work for you, you don't need to force yourself to do it. It's something that is one of the many tools

in your tool belt. Remember that building in public is fundamentally about generosity and

transparency and community. If those things align with your personality and your business model,

then building in public is a powerful way to gain customers trust and build your brand and grow your

business. In the end, it's up to you to make that choice. And that's it for today. Thank you for

listening to the Bootshop Founder. You can find me on Twitter @AvidKa, A-R-V-I-D-K-H-L. You'll find my

book and my Twitter course there as well. If you want to support me and the show, please subscribe

to my YouTube channel and get the podcast and your podcast player of choice and leave a really nice

rating and a review by going to rate this podcast.com/founder. Any of this will help the show.

Thank you very much for listening and have a wonderful day. Bye bye.