Bootstrapping an App to $10 Million in Revenue: Christophe Bach, CEO of TextMe (Part 3)

Sramana: Were you bringing them to San Francisco without salary?

Christophe: No. They had salary within TextMe from day one.

Sramana: Okay. That’s interesting. That brings me to the next question, which is what was the financial structure of the company? Were you putting in some of your own money from your prior successes to start this off?

Christophe: Yes, exactly. We invested $600,000 in the company to start with and that would allow compensation for the co-founders. But the important thing is that with this very complete team of co-founders, we were self-sustainable from day one. We have been able to work for at least 12 to 18 months, mostly the four of us, with a very controlled need for part-time people and some consultants. But mainly, the work has been done by the team of co-founders from the beginning. That allows you to actually not have to raise external money because you don’t need to buy talent outside of your co-founding team.

Sramana: Yes. You have to acknowledge the fact that this is your third venture and you have money from previous ventures. Most first time entrepreneurs do not have that capital to invest, so they cannot think about that.

Christophe: Of course. $600,000 is a lot of money.

Sramana: Other than the $600,000 that you put in, you have not raised any other external money?

Christophe: No. We put in an additional $400,000. The company has been basically funded out of $1 million investment from our management.

Sramana: The additional $400,000 was also your money or were there external investors?

Christophe: Money of the co-founders.

Sramana: Okay, awesome. How long did it take you to get the product to a stage where you could launch it in the app store?

Christophe: Very fast, three months.

Sramana: Three months?

Christophe: Yeah. We incorporated the company in March 2011. A new product that offers SMS with real numbers, a number to the end user and the capability to send and receive SMS to any number in the U.S. was released in June 2011.

Sramana: Okay. How did you manage this launch? What were some of the strategic things that you did to find some virality, find some momentum with the audience?

Christophe: There was already strong competition in the app store, but it was probably easier at the time to launch a new app. The important thing was to have a very high quality product from day one, I mean, simple product but super high quality and we got very high ratings very early on.

Sramana: How many ratings did you have and how did you get those ratings?

Christophe: I don’t remember the number of ratings to be honest, it’s about three years ago. But in terms of getting the ratings, the quality of the app makes the rating and it’s not that there is a process where you can get ratings.

Sramana: What did the app do that was special? What made it such a good product?

Christophe: I would say at that time, we had the only product that allowed teenagers to text with a real number. A teenager who did not have a phone but had an iPad touch, would die to get a texting number to text with their friends. That was actually the main selling point at that time.

Sramana: The segment you were going after were teenagers with just an iPad and not a phone number?

Christophe: At that time, yes.

Sramana: Is that a segment that you went after consciously?

Christophe: I would think that our vision was much broader at the beginning. I would say no. We didn’t build TextMe to share SMS to teenagers in the U.S. We built TextMe to bring about a much boarder communication experience, but at the time of the launch that’s what people liked. We were very happy because there are a lot of teenagers in the U.S.

This segment is part 3 in the series : Bootstrapping an App to $10 Million in Revenue: Christophe Bach, CEO of TextMe
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