The thesis

I think reverse engineering is a very powerful tool if you’re trying to figure out what to do next with your life. Look at people that have gotten to where you want to go, see what they’ve done and replicate it.

For the sake of this article, I won’t mention any specific people. This is, for me, the culmination of many successful people I’ve looked at over the past 10+ years.

Now, the first question to properly reverse engineer this is:

Who do I want to be?

I know a few people who, career/business-wise, are exactly where I’d like to be.

The picture is as follows:

  • they own their own business 100% and have full decision power (even if they don’t always use it).
  • a highly profitable business; low-mid 7 figures revenue, 60%+ margin
  • fully remote; they work wherever they want (altough they mostly choose to live in the same 1-2 places)
  • mostly async; little to no meetings allow them to work at any hours they like (this is big for me because I hate schedules)
  • a small team of 1-10 people; being either solo or working with a few highly autonomous people is where it’s at for me
  • entirely virtual; no phyisical products (allows you to easily migrate the company to favourable jurisdictions)

If I could have this while working on something I mostly enjoy that makes our customers happy, I’d be fully satisfied with my career/business.

How do I get there?

Another hard question… given my limitations the business I end up owning will have to be something in software.

It’s what I know and enjoy. It lends itself well to being remote, async, having a small team, being all virtual and having 60%+ margins.

The problem is that software startups are pretty much a lottery. Most fail.

How do you make sure you end up with a 7-figure a year business when most of them fail to survive at all? How do you win a lottery?

Well, you just buy a whole lot of tickets, right?

Place many small bets

While this strategy is dumb in a real lottery because the cost of a ticket is set such that the house has an edge… the same is not neccessarily true for “the startup game”.

Who’s to say that you can’t get a slight edge here? What if you could create software products cheaply & quickly, launch them, market them, see if they get traction and move on to a new “bet”.

You won’t be able to do this if you can’t code for example. You’d have to hire an agency to do the coding which is quite costly and there will be a communication overhead so moving fast is also mostly out of question.

You won’t be able to do this if you have 0 marketing skills either. Same thing, you’d have to outsource content, SEO, ads and so on. Costs go up, speed goes down.

But I’m not in that position. I’ve been a software engineer for 5 years now. I’ve had experience designing websites and web apps, not only building them.

Being a random guy from Romania with no college or network, I had to figure out how to market myself with content, cold outreach and so on.

It’s not outside the scope of my abilities to come up with a product idea (maybe to scratch my own itch?), design how it looks and works, code it and deploy it on my own infra, do some research on ahrefs and write some articles for SEO, and talk about it on my Twitter or YouTube.

It’s also not hard for me to spare a small portion of my software engineer salary, say $100-300 per product at launch, for ads for these products I build.

This is how I intend to play the “startup lottery”. But there’s are a few more edges I have…

Cruise mode

Just because a product didn’t get traction, doesn’t mean we have to shut it down. With my software engineering skills I should be able to create products that mostly live by themselves and require little maintenance.

If I keep a product alive, even if I don’t work on it, there’s always a change that, at a much later date, it catches a lucky gust of wind and gains traction.

See, for me, the key to winning this game is to increase my luck surface area. And all these aspects together build my strategy.

Self-hosted angle

Self-hosted software is not for everyone, the market certainly is smaller than for SaaS, at least right now.

That doesn’t mean you can’t make self-hosted products that are profitable though. I’ve talked about this topic extensively here and here.

But what you have to understand is that:

  • even if only 1% of a market wants self-hosted solutions, if the market is big enough it’s fine
  • you have 0 infra costs which is great for my “cruise mode” approach
  • focusing on this angle will make me better at building self-hosted software increasing my edge over time

Not needing a big winner

Do I really care if the 7 figures comes from just one product or many products?

I don’t.

Making a self-hosted B2B product that actually helps businesses, mostly runs on cruise mode and brings in six figures a year doesn’t seem that crazy unrealistic to me.

Having a few can bring you up to that 7 figure mark. Plus you get diversification in case shit hits the fan.

Not NEEDING a winner NOW

Perhaps my biggest advantage is that I have a great job I really love.

I make enough money to live well, work on things I enjoy (PRISM by Dextrac), am already remote/async.

Most of my requirements from the “What do I want to be?” part are already met at my current job.

The reasons why I’m playing the startup lottery are:

  • I like building software
  • I want to be diversified in case I lose this great job
  • I want to be rich, not just well off

But if all of my startup bets flop, I’ll be fine. And, more importantly to my edge, I can keep going for as long as I want. I’ll never run out of runway cause I don’t live from savings.

I’ll never grow tired cause 1. I’m doing stuff I enjoy 2. my bets are small enough to not “kill” me.

Being able to place, say, 6 of these startup bets per year for the next 5-10 years is my strategy.

Wish me luck,
Alex Lazar.

P.S.: My most recent bet was Expensio, a personal finance app for people that hate tracking their expenses. Maybe check it out?