No.11: Bootstrapping with a 1,000 True Fans
Curated news and insights about bootstrapped entrepreneurs building real businesses and the investors who want to finance them.
Good morning people,
In a 2008 essay, Kevin Kelly, the founding executive editor of Wired magazine, brought to life the concept of a “1,000 true fans”. As best explained by Kelly:
A creator, such as an artist, musician, photographer, craftsperson, performer, animator, designer, videomaker, or author – in other words, anyone producing works of art – needs to acquire only 1,000 True Fans to make a living. A True Fan is defined as someone who will purchase anything and everything you produce. They will drive 200 miles to see you sing. They will buy the super deluxe re-issued hi-res box set of your stuff even though they have the low-res version. They have a Google Alert set for your name. They bookmark the eBay page where your out-of-print editions show up. They come to your openings. They have you sign their copies. They buy the t-shirt, and the mug, and the hat. They can’t wait till you issue your next work. They are true fans.
1,000 True Fans by Kevin Kelly
The concept shows that there is an alternative to the two extremes of being an artist (blockbuster artist -head- and poverty -long tail) if artists can acquire and make a living off only a “1,000 true fans”.
I am suggesting there is a home for creatives in between poverty and stardom. Somewhere lower than stratospheric bestsellerdom, but higher than the obscurity of the long tail. I don’t know the actual true number, but I think a dedicated artist could cultivate 1,000 True Fans, and by their direct support using new technology, make an honest living.
Key to the concept is having a direct relationship with your true fans. As internet emerged with many tools (think Youtube, Instagram, podcast, newsletter etc…), creators have less pressure to use intermediaries (e.g. publishers, labels, studios) to reach their fans and have the opportunity to earn more:
This new technology permits creators to maintain relationships, so that the customer can become a fan, and so that the creator keeps the total amount of payment, which reduces the number of fans needed. […] Whatever your interests as a creator are, your 1,000 true fans are one click from you. As far as I can tell there is nothing — no product, no idea, no desire — without a fan base on the internet. Every thing made, or thought of, can interest at least one person in a million — it’s a low bar. Yet if even only one out of million people were interested, that’s potentially 7,000 people on the planet. That means that any 1-in-a-million appeal can find 1,000 true fans. The trick is to practically find those fans, or more accurately, to have them find you.
I believe the alternative of a 1,000 true fans can also be applied to entrepreneurship: as a founder, you can choose to build a hyper-growth unicorn (“head”) or failing doing so (“long tail”). Reaching for 1,000 True Fans (whether in B2C or B2B) is a great way to build profitable and sustainable business, even if it has a modest size.
The point of this strategy is to say that you don’t need a hit to survive. You don’t need to aim for the short head of best-sellerdom to escape the long tail. There is a place in the middle, that is not very far away from the tail, where you can at least make a living. That mid-way haven is called 1,000 True Fans. It is an alternate destination for an artist to aim for.
The reason that “small is beautiful” is because no intermediaries are involved and that way the creator can keep more revenue - the same way that bootstrapped entrepreneurs don’t need a $b+ exit to be financially successful.
When you have corporations involved in taking the majority of the revenue for your work [e.g. in book publishing], then it takes many times more True Fans to support you. To the degree an author cultivates direct contact with his/her fans, the smaller the number needed.
Finally, building a sustainable tech company using a 1,000 true fans can be a way to own a small profitable company, or the first step in the journey of building a blockbuster.
The takeaway: 1,000 true fans is an alternative path to success other than stardom. Instead of trying to reach the narrow and unlikely peaks of platinum bestseller hits, blockbusters, and celebrity status, you can aim for direct connection with a thousand true fans. On your way, no matter how many fans you actually succeed in gaining, you’ll be surrounded not by faddish infatuation, but by genuine and true appreciation. It’s a much saner destiny to hope for. And you are much more likely to actually arrive there.
In other news
Trusted brands (presentation)
USV shared a great - and short - presentation for startups looking to build a trusted brand.
Indie.vc announced its v3 portfolio companies (article)
The revenue-shared financing fund Indie.vc has invested in 8 companies and they all look quite different.
Each of these companies is targeting wildly different markets with a range of different technologies. Each is beginning to work with us at very different points along their journey as scaling businesses with some generating six figures a month in revenue and others generating only single digit thousands.
Tinyseed announced its companies for the 2019 batch (article)
The accelerator for bootstrapped companies also announced the 5 companies for its first ever program.
Since applications closed for our first accelerator batch on February 15th, we’ve been hard at work narrowing down the nearly 900 submissions. We are astounded by the sheer number and quality of applications we received from so many bootstrapped companies from all over the world.
SPANX founder and CEO Sara Blakely didn’t quit her job before landing 2 major clients
About Mereo
Mereo is a newsletter-driven publication about entrepreneurs building real businesses and the investors who want to finance them. Mereo is written by Michel Geolier, a venture investor based in Munich, Germany.
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