The Enterprise Riptide – A Pattern of Banana Stands

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The Enterprise Riptide – A Pattern of Banana Stands


I’m at an interesting point in the career of my banana stand. I’m either actively replacing, or thinking of replacing, many of the software-as-a-services (SaaS) providers I’ve built my business on. And it’s not because I’ve grown out of them. It’s because they’ve grown out of me.

There’s this phenomenon in SaaS offerings. Often, they start out serving small businesses and solo entrepreneurs. But if they survive, they almost inevitably pivot to serving large enterprise accounts. They raise their prices (sometimes as a sudden and rude surprise, *cough*Drip*cough*). Their support process becomes byzantine. They focus all their developer time on new enterprise-friendly features like SSO. They stop paying attention to the bug reports and feature requests from the indie creators who gave them their first business—unless those creators have gone corporate right along with them.

I think of this as the SaaS enterprise riptide. Almost every scrappy company eventually gets pulled out into the enterprise/ecommerce depths. This is, after all, where the money is.

I say almost every. a few companies avoid this undertow. Examples that come to mind: ConvertKit. Gumroad. Linode. There’s a pretty obvious common denominator: these are companies that are bootstrapped, self-funded, and self-owned. As Jessitron pointed out when we were talking about this phenomenon, taking VC funding makes the riptide unavoidable. You can’t get your VCs to their big payoff without swimming with the whales.

That’s not to say that every bootstrapped company stays indie-focused, nor that they should. It’s a necessary prerequisite, but not sufficient. The leadership still has to choose to keep swimming in the shallows. But if they are dancing on VC strings, it’s not a choice they get to make.

Anyway, this is not an article about how to fund your SaaS. The point is this: if you run a banana stand for a decade or more, you’re gonna encounter this riptide. Your tools are going to grow steadily away from you, even as they charge you more. Periodically, you’re going to have to swim sideways to land on the next generation of scrappy, indie-creator-focused service providers. Being shocked and disappointed when this happens is a waste of energy (boy have I wasted a lot of energy).

Oh, and I know it’s hard sometimes to suss out who a company really serves, since they all try to sound like they are all things to all customers. Back when I was getting started, the best tell of an indie-friendly startup was that they had an active Twitter account. As of 2022, the best telltale seems to be that they have a freely joinable Discord channel (not a Slack). Just FYI.



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