In 6 years, I brought my moving company to $100 million in revenue. Avoiding VC funding was essential

Most of the big players have been around for decades, some since the 1900s, and we felt the industry was ripe for innovation. In 2018, at 24 years old, I launched Piece of Cake Moving with the purchase of a truck for $20,000. Since then, it has grown to more than 350 trucks, doing more than 100,000 moves annually, employing 800 people – and surpassing $100 million in annual revenue in 2023.

We have never taken on external investment and I believe the decision to avoid VC funding was critical to creating a service and brand with high demand, as well as achieving sustainable growth. The Kauffman Foundation analyzed the 5,000 fastest growing companies in the US and found that 67% secured financing through personal savings or bank loans, followed by 34% who secured financing through credit cards. Only 6% secured funding from venture capitalists.

Over the past five years, we have received interest from both venture capital firms and investment firms, especially during the pandemic with the increased demand for relocation, and in the last year as we expanded into the US. a more reliable and secure path to sustained startup success and ensuring the longevity of a business. Here are some things to keep in mind:

Maintain control over all decisions

Bootstrapping allows you to have the highest degree of control when building a business by retaining full ownership and decision making. When you don’t have outside investors, you have a bigger say in your time, money, priorities, and the direction you want to take the company. You can dedicate all of your time to creating an in-demand service or product that meets your customers’ needs, as well as building a business model that will generate revenue that leads to sustainable growth. When a startup accepts VC money, it gives up some of its control and is sometimes forced to make decisions and set priorities that run counter to its vision or business plans.

Create the perfect product and service market fit

When Piece of Cake Moving launched, we put all our resources into creating a high quality service as well as acquiring clients. We didn’t let perfection stop us from going to market and refining our operations based on early customer feedback. Such feedback is essential for the development of a business. Look for patterns in it, both good and bad. The most useful feedback is negative because it creates an opportunity to fine-tune exactly what the customer is looking for and find the perfect product fit for the market. When you’re in control of your business, you can constantly evaluate what’s working well and remove what isn’t, with the flexibility to pivot where needed without having to ask for approval.

Generate high demand by investing in your customers

Your customers are your sales agents and have the potential to contribute significantly to the growth of your business. About 72% of customers will tell six or more people if they have a satisfactory experience, and 82% of people trust the voice of customers more than brand messages. What the brand says matters, but what customers say will always matter more. Referrals are highly effective because of the implicit level of trust customers place in friends and family and lead to higher lifetime customer retention rates.

Build a culture of inventiveness

When a business takes VC funding, the money is often spent quickly without generating revenue or producing sales. Up to 75% of VC-backed startups fail, and up to 40% of them liquidate assets, according to Harvard Business School professor Shikhar Ghosh. When it’s your money, you’re careful about how you spend every dollar, and the only way to grow is to reinvest the profits you’ve made back into the company. This gives you a special focus on the sales and marketing channels that give the best result at the lowest cost. It pushes you to think outside the box. When we launched Piece of Cake, almost all moving trucks in the industry were plain, so we made ours bright pink to stand out. It has since become the flagship of our brand.

Focus on sustainable growth at pace

Building a profitable business can be a long road. You need to understand your customer, develop a highly effective customer acquisition pipeline and anticipate their future needs. Putting your customers’ happiness at the center of your growth strategy and decision-making process leads to extraordinary returns. According to Forrester, investing in a customer-first operation can generate an ROI of up to 700% over 12 years. Bootstrapping your business allows you to rely on the data you get from your customers and the trends you see in your field, versus having to factor in outside voices who don’t know the complexities your business

Hire and retain the right employees

If there’s a secret sauce, it’s hiring and keeping the right employees. When you spend your money, you’ll have a closer eye on the fact that each role is essential and that you’re working toward a specific goal. It’s important to focus on putting the right hiring processes in place to attract talent who want to grow with the company and create a culture people are proud to be a part of. When you have high retention and provide growth opportunities for employees, you don’t have to spend time and resources constantly training new people. The cost of replacing a highly trained employee can exceed 200% of their annual salary, so it’s a worthwhile investment to prioritize your team.

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