Arvid Kahl

How I Deal with Investment Offers — The Bootstrapped Founder 303

Published 2 months ago • 6 min read

Dear founder,

Ever since I started building Podscan in public, I’ve received a lot of attention.

And it’s been spectacular: I’ve found early users, prospects, customers, and cheerleaders.

Apparently, when people see something get traction, they want to be a part of it. Besides the much welcome support on social media, this has also resulted in a few offers that go beyond monthly subscription revenue. Today, I want to share with you how I think about collaborating with people, taking investment, and growing the team.

Now, you know I’m very transparent with the goings-on inside Podscan, after all, I am building it in public and want to encourage people to do the same with their entrepreneurial experiments.

That’s why I will not hold back with my opinions and sentiments today. Take them with a grain of salt: they’re my personal and extremely subjective observations and reasons. This topic is uniquely complicated for every founder, so please understand that this isn’t advice, it’s food for thought.

It definitely has been occupying my mind over the last few weeks. I’ve gotten offers for co-founders, angel investments, elaborate business partnerships, and then some.

If I’d taken them all, Podscan would now have a sizeable cap table, a handful co-founders, and we’d be working on integrations with a dozen or so established services.

So far, I have been extremely careful saying yes to anything.

In fact, I said no to most of them — for now.

There’s something magical about being a solopreneur. It lends itself so wonderfully to the software business life. I build what needs to be built, put systems in place for things to work all by themselves, and then I get people interested in paying for the thing. And wasn’t Sam Altman just saying yesterday that AI makes the first single-operator billion dollar business possible?

It certainly is an alluring dream to be the sole decider in a business.

And, realistically, also the only person responsible for its endurance and success. I won’t be kidding myself here: Podscan will need to grow. Eventually, I will need to hire, and I’ll need to partner up with collaborators that will benefit from my work just as much as I will from theirs.

So it’s not a question of if, but when.

Let me take a look at how I look at this for three distinct offers I got.

One of the first kinds of messages I got from a variety of peers was that of becoming an after-the-fact co-founder. People saw my public journey, they noticed I was lacking a few things, and they felt that they’d be able to contribute meaningfully to the success of the business.

And let me tell you something: every single offer I got was absolutely right about that. Their talents eclipsed mine if every single area they’d suggest.

But is it worth giving up ownership for that?

I don’t think so. My last company, FeedbackPanda, was a “family business”, I co-founded it with my life partner Danielle. We ran and grew it without ever hiring anyone, and we paid for services and contract work when we needed that. When it came to selling the business, our complexity was effectively zero. No additional decision-makers, no hesitation, no delays.

At this point in my journey, that’s what I want to retain: control over the internal challenges. So no co-founders for me for now.

But how about investors?

Now that’s an interesting question, particularly as I’ve shared that Podscan incurs a few thousand dollars a month in expenses. A cash injection wouldn’t hurt here, right?

Well, yes, and no. It really depends what it’s going to cost me. And my options here are limited: no bank will give me a loan for a not-yet-profitable business with the goal to transcribe all podcasts everywhere. And they certainly won’t give me money without collateral. What would that be anyway? My Mac Studio? My AWS credits? Not going to happen.

But there are alternatives, and I mentioned that I’ve gotten a few emails with flat-out angel check offers already. People see the value of what I have already built and what it will grow into in the future: an archive of content that exists nowhere else. The more I transcribe, the harder it will be to replicate. So they come knocking early.

What will I do? No idea. I will go through each offer one by one to see how much complexity it would add. And I don’t just mean legal challenges.

I mean people. Can I see myself working with and for these people? Do I trust their sense of entrepreneurial direction? Do they want me to keep running a calm business, or do they seek a liquidity event in the next year? I certainly don’t want to add someone else’s expectations as pressure on my own path. In this relationship, I am looking for guidance and the freedom to follow my entrepreneurial instinct.

So let’s see if I can find it within the offers I have received or will surely be receiving in the future.

But, let’s talk about something that I am currently taking some action towards: collaborative partnerships with other software businesses. Can’t name them just yet, as all of these are behind-the-scenes, but a number of agencies and software businesses are actively building features for their products and clients on the Podscan APIs. Some contact me almost daily, some have been building from the API documentation alone. But there is something magical in seeing people using Podscan to increase the value they deliver to their customers.

This is something I am leaning into quite heavily. First off, it validates that Podscan could survive as a standalone API business — which is something I didn’t expect it to ever be, even partially. But yeah: turns out if you catalogue all podcasts everywhere, people want to access that data. D’oh!

It also cements the necessity for me to build a stable system, and that is an external pressure I quite enjoy. In the last two weeks, I have learned a lot about database performance, API management and —unsurprisingly— the complexity of working with dates. It’s challenging work, and often requires the figurative open-heart surgery on a running production system, but every single day, the system becomes better, stronger, and more resilient.

I’ve been thinking a lot about moats with Podscan, it being built on publicly available data. It’s definitely possible to build a clone of this business. So if you want to deal with hundreds of thousands of webhooks hitting your servers every day, reaching libcurl’s error code range of 63 and above when downloading audio files from all over the world and waste weeks figuring out just how to correctly store massive amounts of vector embeddings, go ahead. I’m fortunate to have cash reserves set aside for exactly this kind of project, but it certainly is not your easily bootstrappable project.

I did some math: if I didn’t run my transcription and inference using Local AI on my own GPU servers, I’d be spending roughly $30.000 a month on API calls.

That feels like a moat to keep at least the less ambitious at bay.

Which is why I’ll keep building this in public, knowing that I will find more partners, collaborators, potential investors, and a whole lot of supporters for the Podscan journey.

And now, back to work. Those podcasts won’t transcribe themselves. Uhm.. You know what I mean.

I'll share a few updates about my SaaS on the pod, and I'd love to know what you think about them! Please leave a voice message at 🥰

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Arvid Kahl

I help founders and creators serve and empower their customers.

Being your own boss isn't easy, but it's worth it. Learn how to build a legacy while being kind and authentic. I want to empower as many entrepreneurs as possible to help themselves (and those they choose to serve).

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