3 ways we’ve kept our growing startup scrappy and one way we haven’t

I can still remember sitting in our apartment in Marina del Rey when it was just the two of us and saying,

“I wonder if some day we’ll have a team, an office, investors, and…paying customers”

Well that day came, we went through Techstars, raised over $1M (and over $2.6M to date), we have an amazing team, an office, some truly exceptional investors and very happy customers. I still pinch myself sometimes to make sure it’s all really happening, but it is, and with it comes a lot of decisions that you don’t really think much about until you have to make them.

One thing we’ve tried to do every step of the way is to stay scrappy and not spend money on things we don’t need. I’ve seen other startups go through money a lot faster than us on things that I honestly don’t think has any material impact on their business.

The other day I was talking to a friend about some of the ways we’ve stayed scrappy over the years and she said:

“you guys have done a great job saving money, but doing it in the right way. You should write an article about it”

So…this is that article. While the focus is three things we’ve done to stay scrappy, I thought it was important to look at one area where we aren’t scrappy at all. By staying scrappy we’ve been able to put more of our money into the team which is where I think the bulk of the burn should go since it takes a great team to make a great company.

Okay, enough back-story, here’s three ways we have stayed scrappy over the years:

1.A nice office in a not-as-nice building — we have kept our office rent low by staying away from the flashy startup offices you see in the news. Our building doesn’t look fancy, and it’s not a Class A or Class B building. That being said, our office within the building is nice, clean and comfortable and most people are surprised at how nice it is given how funky the exterior of our building is. This also means we’ve been able to be in the heart of downtown Austin so we haven’t had to sacrifice location. I’ve compared what we pay to friends with teams a third our size and many of them pay twice as much as we do. For an office in downtown Austin that can fit 15 people we pay less than $3,000/month, scrappy — yes, but not at the expense of comfort, just at the expense of not having a super fancy flashy exterior to our office.

2. Staying at AirBnB’s or with friends/family rather than hotels — I see a lot of startups spending a fortune on hotel rooms when they travel to a conference or visit a client. We opt for AirBnB’s where we can have 3–4 people stay for a lot less. Just like my example above, this doesn’t mean we stay in some funky place in a bad part of town. For one of our major conferences last year we stayed in a great house with plenty of room for everyone, it was amazing and probably a lot nicer than any hotel in the area. The cost was less than the price of two hotel rooms and there were five of us so we would have needed 3 rooms if we went the hotel route. When we go to the Bay Area we often stay with friends or family, the same is true in NYC. We definitely saved over $10,000 last year doing this and I’m actually a lot more comfortable staying with friends/family than in a hotel room. Sure, we could have stayed in a hotel and it would have made our commute a little easier but saving hundreds of dollars a night really does add up over time.

3. Building our own trade show booths — this is something I learned during my time at Sonos. Even when Sonos had hundreds of people and a very meaningful amount of revenue I can still remember us driving a cargo van to Vegas for CES and setting-up our booth as a team. I even remember our CEO driving his Prius to Vegas carrying additional parts for the booth, everyone chipped in and while we watched other companies half our size hire expensive crews to build their booths, we did it ourselves. We’ve done the same thing at our startup and it’s actually been a great team-building exercise and something I look forward to. I wrote an article last year about what a trade show can teach you about your team and building the booth together is a great exercise in team work that we’ll continue to do for a long time. I’ve seen some startups raise a round of funding and then instantly drop $20,000+ on a new booth and pay a small fortune to have a crew build the booth. They then arrive at the trade show, do their thing, and fly out. What they miss is the bonding experience that I saw first-hand at Sonos and am experiencing again now. Yes — it’s a pain in the ass to build a booth, and you’ll encounter all kinds of hassles that are totally outside of what someone might normally do in their job role, but doing this together as a team couldn’t be more valuable, and yes, it save a LOT of money.

So that’s three ways we’ve stayed scrappy, but there’s one way that we actually might over-spend a bit, it’s an area where we aren’t scrappy but I’m proud that we’re not.

One way we haven’t been scrappy

When it comes to our healthcare benefits we decided not to be scrappy. In fact we’ve found that the healthcare we provide is on-par or better than what people normally find at a big company with lots of resources.

Yes, there’s a reasonable chance that we spend more money than other startups at our stage to make sure everyone has great healthcare, but for us this is an area that we don’t want to be scrappy. We don’t want our employees to feel like they are sacrificing the health and/or well-being of their family working at our company.

This has had a very meaningful impact on our culture and it sends the message that we as a company don’t expect you to give up your quality of healthcare if you leave a big company to join us, that’s not a sacrifice we want you to make.

I’ve heard some founders talk about the ways they have cut-corners to decrease healthcare costs…and then I’ve talked to employees from their company and I can tell you it takes a toll on both the team and the culture.

We look for passionate people who find what we’re doing incredibly exciting, love solving hard problems, and are behind our vision for changing the world. At the same time we’re not looking for people who need a fancy office or need to stay in fancy hotels, we don’t think these are requirements for building a great company or a great culture. We do think that having great healthcare is important and if we ever grow to be 100 people or 1,000 people or 10,000 that’s not going to change.

I’m proud of all the ways we’ve stayed scrappy and what we’ve done to keep our burn as low as possible, but I’m proud we’ve done this without having to sacrifice our team’s quality of healthcare, comfort, etc.

Life’s all about balance and finding the right balance isn’t easy. I don’t want to make it sound like we’re perfect and we’ve figured everything out yet because that’s definitely not the case. What I can say is that we’re learning every day and so far this is what we’ve learned about how and where to stay scrappy.

Morgan is the co-founder and CRO of Bold Metrics a SaaS startup that has become the gold standard for predicting the human body. Bold Metrics is trusted by some of the largest brands and retailers in the world and it at the forefront of exploring how VR and AR will fundamentally change commerce.

Photo Credit: Stéphane PERES Flickr via Compfight cc

co-founder at Bold Metrics| previously at Sonos | I write a lot and take way too many photos