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Bootstrapping CoderPad to $4M+ ARR with 3 employees

Welcome to the 54 new subscribers since the last post 🔥. If you haven't already, follow me on Twitter and LinkedIn for the stories and insights that don't make it to the newsletter.

I had the chance to talk with Vincent Woo the other day. He was working his day job at Everlane in 2013 when he created CoderPad, a coding interview platform that allowed real-time code execution. Today, CoderPad is used by over 1500 companies including Facebook, Uber, and Dropbox.

A few things stick out to me:

  • CoderPad only had 3 full-time employee and Vincent owned basically the entire company

  • Bootstrapped to $4M+ ARR in 2019 and later sold that year for tens of millions

  • Always maintained revenue growth and profitability.

Here's the story 👇

💭 How CoderPad Started

While working at Everlane, Vincent would often interview potential candidates. Software engineering interviews typically require a live coding assessment to evaluate a candidate's ability. 

This would usually be done through some collaborative environment, like a Google Doc or online collaborative text editors such as Collabedit. 

The main pain point is that neither of these platforms allowed for code execution, which means the code couldn't be tested by both the interviewer or the candidate. This often led to less efficient coding interviews, a worse candidate interviewing experience, and made it more difficult to evaluate the technical abilities of a candidate.

Tired of this, Vincent decided to create a solution for this. A few months later, he would have a version of a REPL editor that could execute Ruby code in the browser. 

But it wasn't long until Vincent got extremely positive feedback from this. His coworkers were using it and interview candidates were loving it. He decided to turn this into a business and expanded CoderPad to use 30+ languages. 

After a year of working on CoderPad, Vincent grew the business to $4k MRR and quit his job at Everlane

📈 Growing to 4M+ ARR with 3 employees

Usually, at this point, I would try and tell you the key factors that helped the business scale, major turning points, or other interesting details. But CoderPad wasn't that. In fact, when I talked to Vincent, he said there was nothing really special about what he did and described CoderPad as a "boring business".

CoderPad grew from mostly inbound channels, candidates would use CoderPad and then eventually request them in future interviews. Companies took notice of this, and CoderPad quickly became the go-to interview platform for Dropbox, Uber, and Facebook.

Vincent never tried any growth hacks, and most of the time he was just building features requested by clients. He tried paid acquisition early and the results were horrible he never did it again. Outbound marketing just wasn't effective for them.

He kept the team lean by only hiring people that he needed to hire and not for the sake of growing. He avoided VC because he felt that it was too much work and he didn't want to build a billion-dollar company (YC rejected him for this question).

Towards the end of our call, Vincent gave me a lot of key takeaways and lessons that he learned from building CoderPad 👇

The idea is more important than the execution

According to Vincent, CoderPad's success was because they were first in the market, and they had a perfect product market fit. CoderPad gave a better solution to hiring engineers, a huge problem and pain point for many tech companies during that time.

"Don't work on a startup just to do a startup. Do it when you have an idea that solves a real problem" 

Vincent Woo

You have to immerse yourself in the real world to find problems to solve

Prior to Everlane, Vincent worked at Amazon and Google. Large companies that usually have an in-house solution to nearly every problem. Google specifically uses Google Docs for its interviewing platform, later building its own internal version. 

Had Vincent continued to work at Google, it's very possible that he wouldn't have discovered CoderPad.

Instead, Vincent recommends trying new things, getting a lot of hobbies, or working in an environment more connected to the real world. It's the best way to discover problems in everyday life and how you can solve them.

Learn either sales or marketing

I asked Vincent why he didn't try marketing CoderPad more. He said that marketing is extremely tough. You usually have to hire a small team to even get started and there are a lot of upfront costs that might not be worth it.

Instead, he focused on sales. Specifically, he had to focus a lot on communicating clearly and figuring out the right thing to say. It's one of the most important skills for a founder.

Thanks for reading, and I hope this helped you or you found it interesting! We had a different type of story today, and I'd love to hear what you thought about it! You can reply to the poll or to this email with feedback! Also, thanks again Vincent Woo for meeting with me for this piece!

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