Bootstrapped Entrepreneur: Learning from Errors at Every Stage


Tim J. Smith, PhD
Founder and CEO, Wiglaf Pricing

Published April 26, 2018

Bootstrapped Entrepreneur: Learning from Errors at Every Stage

It has been 16 years since Wiglaf LLC was incorporated and the journey is far from predictable.  I made errors, learned from them, and moved forward.  Some things were ill-advised, but I did them anyway. The warnings didn’t prevent the errors, but they did make them easier to recognize and correct before it got too bad.  So, what were my errors and what have I learned?

Stage 1:  Idea Sifting

One would best characterize the first five years of Wiglaf as idea sifting to find one worth saving.  I wondered around, checked under rocks for a good idea, and then tried again, repeatedly. I did website development.  I did financial value calculators.  I did copywriting.  I did market research.  I did industry reports.  I did sales training.  I did just about anything I could just to survive.

Most of these activities surrounded the intersection of quantitative analysis, sales, and marketing.  One could say Wiglaf was a “quantitative marketing strategy consultancy,” but I found this brand position market irrelevant.

While I couldn’t find purchase in any one specific area during this period of idea sifting, I did learn and survive.

My failure to thrive in those years was largely related to having no singular specific area of expertise.  Yes, I was OK at the things I did, but I wasn’t “stellar.”  In a crowded market with lots of competition and customers that want the best, being “OK” isn’t good enough.  You have to be among the best-of-the-best to drive customers to alter purchasing behavior, and switch suppliers from what they know to something they don’t.

Yet I did survive and learn.  Monetary survival came largely through holding a part-time job at DePaul University as an Adjunct Professor, for in the early years as a completely bootstrapped entrepreneur with no financial assets, one must support oneself through other means.  Psychological survival came from the unending support of my spouse and having an outlet to express myself in the Wiglaf Journal, one of the few initiatives that spans the timeline of Wiglaf LLC.

One of the rocks I turned over during this time was that of pricing.  Pricing is quantitative marketing, and it fit the pattern of areas where I could at least capture customers.  I found it quite by deliberate accident.  In my writing about value-based selling and quantifying the value to the customer to drive sales, I found the message resonated with the pricing community.  While working in Prague on a couple of ventures, I had the opportunity to present workshops at the Professional Pricing Society European conference.

I took that opportunity, researched pricing using academic journals and popular business books, and spoke.  Concurrently I shifted my writing to focus on exploring theories of pricing and applying them to real business situations.  These developments led to Wiglaf’s first major project in pricing.  It was the biggest project I had had to date, and the most lucrative.

A worthy idea had been identified.  After sifting through one initiative after the other, I had found an area where Wiglaf could compete.  Pivot to Wiglaf Pricing.

Stage 2:  Brand Building

Wiglaf Pricing wasn’t going to build itself.  It had to be built.  People need to identify Wiglaf Pricing as a premier pricing consultancy before they are going to buy from it.  A brand had to be built and customers had to be won.  This stage took another five years and was the one where I leaned the most about building a brand and managing volatility.

I returned to the States and increased my teaching load at DePaul University to manage any financial instability.  DePaul didn’t have a pricing strategy course, so I asked to create and teach one.  They were kind enough, and saw the need, to do so.  The classroom is an ideal place to develop one’s ability to clarify and communicate ideas with working professionals.

In teaching pricing, I didn’t immediately find a textbook that met my student’s learning needs.  As a bootstrapped entrepreneur, I knew that if a gap in the market exists, seize it.  I wrote Pricing Strategy to meet the learning goals of my students.  Not only did it aide my students, but it also signaled Wiglaf’s expertise in pricing to the market, and generated a little royalty income.

On top of writing a textbook on pricing, I seized opportunities to speak, teach, and write on pricing.  I gave workshops at a wide variety of professional conferences and with numerous training firms.  I created a series of training webinars to test content on working professionals to discover what interested professionals.  And I kept writing the Wiglaf Journal.  This content generation approach to guerrilla marketing slowly built a brand.  People began to recognize Wiglaf Pricing as knowledgeable in pricing.

With an emerging brand, business slowly started to build, but it was precarious.  Revenues would jump up and down by a factor of 20, and never reached more than half-a-million U.S. dollars a year. Customers would come from almost anywhere.  Besides the States, Wiglaf Pricing served in Romania, Singapore, India, Ireland, and elsewhere.  It pays to have a good passport.

Managing highly volatile workloads and revenue is difficult.  Staffing projects that come one day and are gone in a quarter with zero certainty of future work and revenue required an itinerant worker approach.  Rather than hire regular employees that would expect a continuous paycheck, Wiglaf Pricing had to rely upon contractors.  One lesson learned was to develop a large network of friends in the field so that if something came along, you could find someone to work with.  With a large enough network of professionals in the field, I gained confidence in the knowledge that at any given time, someone competent would be between postings and willing to take on a short-term gig.

Stage 3:  Organizational Development

As work became steadier, Wiglaf took the plunge to set up a regular office with regular employees in anticipation of growing the business. Here is where costly errors were made.

While Wiglaf Pricing was still small, our regular task list isn’t.  Managerial accounting, website management, content editing, graphic design, computer management, IT systems, legal filings, human resource protocols, and many other tasks must be completed by even the smallest of firms.

I made a costly mistake of hiring a general office manager to take care of back-office tasks when I should have contracted out to specialists.  By hiring a generalist, I thought I would save money and get these tasks done.  That was wrong.  It was wrong to think that a normal person would be able to do all these tasks better than I could without having me explain what constituted a good job on each of them.  Instead, I got mediocre work on a partial list of my objectives, and yet the person doing these tasks didn’t have enough to do because they weren’t trained to do the larger body of tasks.  I had miss-defined the role and the need. This support-staffing error slowed the development of the business.

Now, I contract out parts of this back-office work to individuals that are keen to do a specific task and good at it, while retaining parts of this task list to myself.  This works better and relieves me of a need to do everything – something no one can do competitively.  As we continue to develop, I expect the back-office task list to be continually shifted from me to contractors.  It will be awhile before I take on another regular employee in a support-staff role.

Despite this error, Wiglaf Pricing continued to grow and I became a boss.  A requirement to being a boss is meeting payroll on a regular basis, and that Wiglaf could somewhat accomplish. The challenge of being a boss though is different from what the earlier stages of growth had taught me.  In prior stages, I strove to become an expert in a field, and the effects predominately had an impact on me. In this stage, I had to learn to take others into consideration, and make decisions on their behalf as well as my own.

As a boss, I have a responsibility to develop the career growth of my employees for multiple reasons.  First, if a boss wants more out of their employees, the boss must train their employees.  Second, if a boss wants to retain talent, employees must believe that they have a future of growing their responsibility and overall opportunity.  Third, if a boss wants to grow a company, employees must be capable of taking over whatever the boss is working on at that time. This way the boss can begin to focus on other initiatives.

And fourth, I have come to accept that every employee-employer relationship will end. I would prefer that it ends on positive terms.  Helping employees develop so that they can either add value to my company, or move on to a good job in a different industry increases the odds that any trajectory of the employee-employer relationship will end positively.  (Just don’t compete directly with Wiglaf.)

As a consultancy, Wiglaf Pricing does intellectual work and the aforementioned approach to talent management is particularly important in our line of work. I suppose if I ran a factory with a manufacturing line, the importance of this issue would be reduced, yet that is not what Wiglaf Pricing is.

Stage 4: Work It

My entrepreneurial endeavor is beginning to pay fruits, albeit 15 years after its founding.  The path hasn’t been easy nor financially secure and I wouldn’t necessarily recommend it to anyone.  But then again, successful entrepreneurs don’t always choose to be entrepreneurs.  Many are forced into it via circumstances beyond their control.

I think Wiglaf LLC is at another stage.  I say “I think” because experience has taught me humility in these things.  Optimism keeps me moving forward.

For now, we are going to work it.  Work the brand.  Work the sales pipeline.  Work the processes. Work to standardize projects.  Work multiple marketing and business development initiatives concurrently.  Work to expand and diversify our customer base, and continue to develop talent.

External and internal challenges will arise.  Some challenges may throw us off track but I am confident we will learn from them and get back up.  Tempered yet unquenchable optimism along with dogged-resilience are every entrepreneur’s not-so-secret weapon on a journey where one constantly errs and learns.

About The Author

Tim J. Smith, PhD, is the founder and CEO of Wiglaf Pricing, an Adjunct Professor of Marketing and Economics at DePaul University, and the author of Pricing Done Right (Wiley 2016) and Pricing Strategy (Cengage 2012). At Wiglaf Pricing, Tim leads client engagements. Smith’s popular business book, Pricing Done Right: The Pricing Framework Proven Successful by the World’s Most Profitable Companies, was noted by Dennis Stone, CEO of Overhead Door Corp, as "Essential reading… While many books cover the concepts of pricing, Pricing Done Right goes the additional step of applying the concepts in the real world." Tim’s textbook, Pricing Strategy: Setting Price Levels, Managing Price Discounts, & Establishing Price Structures, has been described by independent reviewers as “the most comprehensive pricing strategy book” on the market. As well as serving as the Academic Advisor to the Professional Pricing Society’s Certified Pricing Professional program, Tim is a member of the American Marketing Association and American Physical Society. He holds a BS in Physics and Chemistry from Southern Methodist University, a BA in Mathematics from Southern Methodist University, a PhD in Physical Chemistry from the University of Chicago, and an MBA with high honors in Strategy and Marketing from the University of Chicago GSB.