Bootstrap to $25 Million from Utah, Raise Money Later to Scale to $100 Million: John Pope, CEO of Jive (Part 3)

Sramana Mitra: Where there is something wrong is this crazy glamorization of unicorns and fundraising. That is really unhealthy and it is really destroying the entrepreneurship ecosystem.

John Pope: I completely agree. In closing on that, what I didn’t want to do was have a business and then stop working hard. Maybe this will resonate with you. A lot of people or so-called business advisors want to tell people to run your own business so that you can have all sorts of free time and have all sorts of money and be less industrious. I think it’s ridiculous that people do that. It’s almost like the get rich quick mentality. Don’t start a business so that you cannot work. Start a business because it’s who you are.

Sramana Mitra: Let’s go back to your personal story. These two business that you did early on that you bootstrapped, how far did they get to?

John Pope: One of them got to a million in revenue and about 20 employees and a couple of subcontractors. The other one got to about $500,000 in revenue. That was a much higher margin.

Sramana Mitra: What did you do with these two companies?

John Pope: These companies functioned pretty well for several years. That’s where the Jive story starts. I needed a phone system that would handle different languages in my customer base on the insurance side and handle mobile technicians on the satellite side.

The options available were not that great – tens of thousands of dollars for a hardware-based PBX system that would sit in the back closet and would need to be eventually replaced. I had a group of friends that I had worked with on some software projects. They had a custom software development shop and they were looking for a phone system. They didn’t like the hardware-based option either.

Sramana Mitra: What year are we talking?

John Pope: This is 2005.

Sramana Mitra: RingCentral and Grasshopper hadn’t hit the market yet? We’ve done both of those. I can’t remember when their founding dates are.

John Pope: RingCentral was around 2002. They weren’t very well-known. I’m not sure when Grasshopper started. This industry, all together, was very young and not very well-known.

Sramana Mitra: You decided to go into cloud-based PBX telephony.

John Pope: Yes. Being a group of software developers, it was something that we felt we could do. We built a very basic product. There started to be a lot of interest around that. Friends and family members who ran businesses started to be interested. I used it for my two other businesses and it solved all sorts of problems.

Sramana Mitra: How did you build the product? Did you bootstrap it with cash from your other two businesses?

John Pope: Because I had co-founders, most of the bootstrapping was our own time. I also jumped into it full-time without taking any pay because I had the other two businesses to support my family. The other co-founders were also relying on spouse income and other business income. We worked really hard and didn’t take a paycheck for years. We were all in our mid-20s and we decided to just go all in. It was a risk.

We just wanted to reinvest everything we possibly could back into the business. For years, it was like that. We didn’t take any funding for seven years. At that point, we were at $25 million in annual run rate. That’s a reflection of the culture we have and who we are. It’s very much a bootstrapping mentality.

This segment is part 3 in the series : Bootstrap to $25 Million from Utah, Raise Money Later to Scale to $100 Million: John Pope, CEO of Jive
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