Category: Entrepreneurship

Categories
Business Decision-making Entrepreneurship Social Impact Sustainability

Software Company in Germany: What Worked, What Didn’t, and What I’d Do Differently

Reading Time: 5 minutes.

More than 5 years ago, I started a bootstrapped limited liability company (LLC) in Germany for my software-as-a-service (SaaS) project “1st things 1st” and non-profit donation platform “Make Impact dot org”. From an egoistic perspective, it was supposed to be the key to financial freedom for me and allow me to help my closest relatives. From a vocational perspective, it should have brought more self- and global awareness to people using the platforms. From a rational perspective, it should have built the legal grounding for the donation platform that I had been building. Unfortunately, internal motivation didn’t match the external circumstances, and this article is my short overview of the lessons learned.

I founded the company as a UG, which by law should have transitioned to a GmbH as soon as it became profitable enough. As someone who didn’t speak German professionally, I got help from firma.de, who provided me with all the necessary information to get started, helped me with a company bank account, and organized an English-speaking notary appointment. A UG officially requires only 1 EUR as initial capital, whereas a GmbH requires 25,000 EUR. Practically, you need a few thousand euros to start with to cover the costs of the initial months.

Over time, I’ve read several business books and always preferred the motivational ones, such as Rework, over the frightening ones, such as The Hard Thing About Hard Things. One thing that I learned from Rework was to reuse and sell by-products of the main project. For example, while building subscription-based software projects, I was also selling reusable modules used in those software projects. The same could be done with writing books or creating an online course based on the expertise you gain from doing your main stuff. Financially, it turned out that the by-products brought me more money than the SaaS subscriptions, but in theory, monthly SaaS subscriptions should have been more predictable, while module sales were almost random.

From a software development perspective, SaaS development is very attractive because you always iterate on the existing code and make it better and better while adding tests, creating automations, improving search engine optimization (SEO), adapting to AI innovations, etc. From a marketing perspective, you can also always test and improve landing pages and copy, do A/B testing, build a blog for content marketing, etc. However, from a political and legal perspective, there are constantly new laws being published that require you to adapt to new limitations, such as cookie consent banners, GDPR and SOC 2 compliance, the No-Spam Act, the AI Act, and whatever comes in the future. These adaptations always require time to react instead of focusing on building or marketing.

An LLC in Germany has some costs and legal limitations that don’t apply to freelancing or operating as an individual. There are some taxes to pay even if you don’t make any profit, which accumulate to over 1,500 EUR per year, mandatory accounting fees of around 2,500 EUR or more per year, and 1,800 EUR for a virtual office for a legal company address, unless you are OK with registering your company at your home address. Also, don’t forget the usual expenses, like notary fees, IT-related stuff, and office supplies. Even closing a company requires around 3,500 EUR at best for different legal purposes and 1 year of shutting down time, which was a bummer to me. And if you don’t have a rich family or another stable source of income, the journey is harsh.

Over the course of those years, I have built several subscription-based projects, several modules to sell, and other digital goods to use as lead magnets. I have tried launches on product directory websites like Product Hunt, paid ads, blog content marketing, search engine optimization, advanced copywriting techniques, textual and visual social media posts, cold emailing, cold direct messages, funnels with special landing pages, guerrilla marketing, flyers, mentioning my product in books, mentioning my products in entrepreneurial meetings, guest blogging, adapting the websites for LLMs, press releases, and a few more marketing channels. I even did some woo-woo magic, like removing my money-related limiting beliefs or listening to sound frequencies that should have attracted financial abundance. The paradox was that the more effort I put in and the more I perfected what I built, the fewer new users I gained. The other important part was that no matter how much value I believed I brought, that didn’t mean that people were ready to pay for it.

I always tried to keep it ethical: no paid followers, no fake reviews, no fake testimonials, no lies in the copy, no fake employees. Interestingly, there are lots of service providers who contacted me offering Product Hunt upvotes, positive Trustpilot reviews, fabricated Reddit engagement about my brands, leads (contact info of people) from any industry, paid articles in questionable business magazines, and business award nominations to boost my ego and status. Extra money to spend and turning a blind eye to ethics would have helped the business for business’s sake — but that’s not my style.

I was also contacted by probably 50 companies offering outsourced IT services from countries with lower wages than Germany, as well as by many individual IT specialists looking for jobs. So having a company creates some kind of illusory reputation even if it’s a one-man show.

Lastly, having a company means that you have to be very careful and discerning about cold emails, as there are lots of fraudsters sending fake invoices to your accountant, webcam blackmail scams, and fake domain renewal notices. If you share your phone number online, you often also get fake calls from random countries.

What I surely learned from this was resilience and stronger self-confidence, focusing on the bright side no matter what, taking action on my ideas more proactively, and optimizing my time and energy.

What I would suggest to anyone starting a SaaS entrepreneurship journey today is to develop oral communication skills even if your business is totally online and text-based, and get a business background that goes a little beyond supply and demand and assets vs. liabilities. For the product you build, don’t reinvent the wheel — use the tech stack that you already know from the past, where you can iterate quickly on demand. The latest technological hype is not worth it. And even if you are the best IT specialist of your kind and have a very smart or useful product, that doesn’t automatically mean that you will be able to distribute it enough to sustain your company.

Even though it seems that the Internet is an open ocean with unlimited possibilities, I would still suggest starting with a local or online community in which you participate, noticing a problem they have that can be solved with IT, asking if they would be willing to pay, creating a tool without monetization for them. Only when there are real people who would buy the service the tool provides should you start a company. Don’t start an LLC in Germany, but rather stick with operating as an individual or even freelancing. You can’t build a sustainable business and pay the required taxes based only on ambition and motivation.

They say that only 10% of businesses succeed, and the others go bankrupt. Somehow, all those who start believe that they belong to the 10%. I thought about SaaS as a source of passive income. It turned out to be a lottery ticket that cost me notary fees, a bank account, virtual office, domains, servers, email, company taxes, bookkeeping, and lots of time. Was it worth it? I gained lots of experience. Otherwise, I see too many bureaucratic restrictions. So I am closing my company and will continue to implement my ideas as an individual under different legal forms.

Cover picture by Lloyd James

Categories
Business Entrepreneurship Progress

Caffeine and Chapters: Exploring the Business Mindset

Reading Time: 12 minutes.

Running entrepreneurial endeavours while being a developer and an artist at heart calls for a different mindset than the one shaped by code and creative culture. So at some point last year, I decided it was time to explore that mindset for my own growth—and picked up a few books to help. Here are some of the key lessons I took from them.

“Million Dollar Weekend” by Noah Kagan

Last year, James from Indie Makers space sent me a copy of this book with the condition that I would share my thoughts about it.

In general, it’s very honest and relatable, but also messy and chaotic, much like real business challenges can be.

Below are lessons, bits of wisdom, and interesting facts that I collected from the book.

The Business Playground: Think in Experiments

Everything you do—every launch, every product, every marketing strategy—should be treated as an experiment. And like all good experiments, some will fail. That’s not a sign to stop, but a signal to learn. Failure isn’t something to avoid; it’s something to expect.

The courage to begin, and to keep trying, is what separates creators from dreamers. This “Creator’s Courage” is what allows you to take an idea and test it in the real world, even if the outcome is uncertain.

Approach your business like a curious builder. Use it as a playground where you can test ideas, learn about yourself, solve problems you personally care about, and help others along the way. This mindset will help you become less self-critical and more open to creative possibilities.

Customer Problem First, Developing a Solution Later

For indie entrepreneurs, success isn’t just about building software or launching flashy products. At its core, business is about solving real problems. Your customers don’t want “more apps” or “innovative features”—they want results that make their lives better. Understanding this simple truth can save you years of chasing the wrong goals.

Marketing gets a lot easier when you have something genuinely useful. You don’t need to convince people if your product solves a real pain point. You don’t need to shout over the noise if there’s already demand and you’re just offering a better way.

Your role is to find existing problems, solve them effectively, and then ask people to pay for that solution. The mistake many make is trying to generate demand where there is none. Don’t convince—serve.

Ask Boldly, Fail Often

Most people never get what they want because they don’t ask. Kyle MacDonald famously traded a red paperclip up to a house, in just 14 steps—all by asking multiple people. If you believe your product or service can improve someone’s life, then not offering it is actually a disservice.

Adopt “rejection goals.” Try aiming for 25 noes. Each rejection is progress. Most “noes” are actually “not yets.” And every “yes” can lead to referrals, testimonials, or another experiment.

If you believe your product can fulfill a true need, it’s your moral obligation to sell it.
– Zig Ziglar

Focus Where It Matters Most

Too many first-time entrepreneurs spend most of their energy perfecting the product and very little time on customer discovery. The hard part isn’t the idea—it’s getting your first paying users.

Validation is simple: talk to people you know. Can you find three people within 48 hours who are willing to pay? That conversation shouldn’t be a pitch; it should be a chat. Ask things like:

  • What would make this a no-brainer for you?
  • Who do you know that might need this?
  • What would you pay for something like this?

Validation often happens faster on existing marketplaces, such as Facebook Marketplace, Reddit, and Craigslist. Even a basic landing page (try Instapage or ClickFunnels) with a clear call to action is enough to test demand.

Use Your Zone of Influence

Beginners often look too far beyond themselves for opportunities. But seasoned entrepreneurs tend to find them close by—among their own interests, skills, problems, and personal networks. Real opportunities come from real people with real names, often already in your life.

Look at what people are already spending money on. Can you build an add-on? Can you teach them how to use it better? Can you sell to that same crowd with a related service?

The easier path is satisfying demand, not creating it from scratch. If you’re opening a taco stand, look for a starving crowd—not people who are “open to the idea of tacos.”

Understand the Numbers

Running a business doesn’t have to be complicated. Know your Freedom Number—the monthly income you need to live the life you want. For example:

  • $1,000 for housing
  • $1,000 for food and travel
  • $1,000 for savings or investment Total: $3,000/month

Profit = Revenue – Cost

Now work backward. If you earn $30 profit per sale, you’ll need 100 sales a month. That’s clear, simple math.

Then, aim to improve your profitability:

  • Increase order size or frequency
  • Adjust your prices
  • Sell to higher-income customers
  • Add complementary products or services
  • Create recurring income (subscriptions or reorders)

Marketing: Do It 100 Times Before Quitting

Marketing is not magic. The Law of 100 says: whatever you try—tweets, blog posts, videos, emails—do it 100 times before evaluating. This shift in mindset helps you push through discouraging early results and build momentum.

Start on social media, but always move your audience to your email list. Without emails, you’re just borrowing attention from platforms. Be a guide, not a guru—share your journey, document your experiments, and invite feedback. One of the best first emails you can send:

“What could I write to provide value to you?”*

A good list doesn’t have to be big. Even a 20% open rate can be powerful. For example, AppSumo used to average $100 per newsletter email. But then made around $9500 when incorporated with better storytelling.

Track what works. Create a spreadsheet with your marketing tactics. List expected results and actual outcomes for each tactic within a chosen duration. Cut what doesn’t work. Focus where returns are strong—even if it’s only $100 or 30 minutes saved per week.

Build Systems That Support You

Being an entrepreneur means you get to design your own system. That’s both the privilege and the challenge. Make sure the system supports your happiness—not just your business growth.

Set ideal goals for the year and group them into categories like Work, Health, Personal, and Travel. Break them down into small steps and put them on a calendar using different colors for each area.

You also need people. Connect with ambitious peers—especially those who aren’t influencers yet but are on their way. These “prefluencers” can become great allies. A supportive community makes the tough parts of the journey more bearable.

And one final reminder: cut toxic relationships, even if they seem cool. Clarity and focus require emotional space.

“What They Teach You at Harvard Business School” by Philip Delves Broughton

The author of the book was a journalist who started studying at Harvard Business School to gain financial freedom. However, he realized that it’s a hardcore experience to study there, and it wasn’t exactly what he expected. While studying there, he learned more about business-oriented people than about doing business in large corporations.

Here are some knowledge bits I extracted from that book for my professional growth:

You Are the Product (Sometimes)

At HBS, days could start at 7 AM and end at midnight. Fifty-five hours of academic work per week seemed extreme to outsiders, but for some students coming from high-pressure jobs, it was actually a break. The stress was real: physical, emotional, and mental strain were constant companions. Yet, students were told their calendars would be full of amazing opportunities—just not enough time to do them all.

In such environments, you learn this: sometimes you’re the customer of the school. Other times, you’re the product. That’s not very different from running your own business. You sell, serve, pitch, learn, hustle—and if you’re not careful, you burn out.

Financial Wisdom Is Simpler Than It Looks

Finance is often seen as complex, but the core ideas are surprisingly simple:

  • Cash is king. More cash is better than less. Sooner is better than later. Certain is better than risky. And never run out of it.
  • Valuation matters. Business is often about assigning value to assets. Whether you’re pricing a digital product or evaluating your startup, the question is: how much is it worth, and why?
  • Inventory basics: A simple formula for product-based businesses:Cost of Goods Sold / Inventory shows how quickly products are moving. Less inventory is better if you’re trying to be lean.
  • In banking: Loans are assets (money going out to earn interest), and deposits are liabilities (money banks owe their customers). That’s the reverse of how most of us think.

A Good Product Is Not Enough

Many entrepreneurs believe a great product will sell itself. It won’t. To succeed, you need:

  • Marketing – to reach people.
  • Sales – to convert them.
  • Customer service – to keep them coming back.

Harvard Business Publishing alone makes $100 million a year selling content for entrepreneurs. If they need marketing, so do you.

Think Like an Economist

Sometimes, small shifts in thinking make a big difference. One example from a restaurant: instead of a full kitchen, have chefs cook at the table. Smaller kitchen, lower rent. Another example: fewer menu items means less waste.

Big companies use this thinking too. McDonald’s decided it was smarter to sell franchises and support them than to own millions of properties. Fashion designers often don’t own factories—they just provide the design specs.

Ethics Are Flexible, But Important

Business ethics weren’t about fixed rules. They were about adapting to changing situations while maintaining basic decency. In business, things rarely fit a formula. But you still need your own boundaries—your “strong moral compass.”

You can lead others through tools like salaries, perks, team-building, promotions, and values. But ethical leadership is what makes those tools effective and keeps your company culture strong.

Know What Gives You an Edge

There are a few main types of competitive advantage:

  • Cost advantage – You make and sell something cheaper.
  • Differentiation – Your product is somehow better or more suited to a specific group.
    • Vertical: better or worse in quality.
    • Horizontal: offering more options or variety.

If you can keep your edge despite competition, that’s called sustainable advantage.

Risk Goes Both Ways

Risk isn’t only about something bad happening. It’s also about something good not happening on time. Not starting a business on hyped services might mean missing a great opportunity.

Pitch Like You Matter

Venture capitalists often invest in people, not just ideas. Put your bio upfront in your pitch deck. They want to know who you are and what drives you.

A good pitch answers two questions:

  • What problem are you solving?
  • Why should I buy it from you?

And always, always pick a niche. A broad audience is harder to reach than a focused one.

Reflect on Your Best Self

One exercise from HBS can be useful for indie founders. Ask yourself:

  • When do you feel like your best self?
  • What helps that version of you show up more often?
  • What keeps you from it?
  • How can you structure your life to bring it out every day?
  • What should you stop doing?
  • Where should you focus more?

Building a business isn’t just about systems and products. It’s also about building yourself.

Nine Out of Ten Fail. So What?

Yes, most businesses fail. That’s reality. But if you’re resilient—if you keep learning, adjusting, and showing up—you increase your odds.

Harvard teaches a lot of theories. But one lesson stands out for anyone starting their own business:

“Live as if you were to die tomorrow. Learn as if you were to live forever.”
— Gandhi

In the end, business isn’t just about profit. It’s about building something that matters, growing through it, and doing it in a way you can be proud of—whatever your size or path.

“What They Don’t Teach You at Harvard Business School” by Mark H. McCormack

The author of this book teaches lots of practical street-smart business tips from his first-hand experience. To do business, you don’t have to be a Harvard Business School graduate, but you have to be brave and proactive.

Here is what I learned from that book:

The People Side of Business

Starting and growing a business isn’t just about products, plans, or tools. It’s mostly about people. Whether you’re closing a deal, negotiating a contract, motivating a team, or just trying to get your first customer, your success depends on how well you understand and work with others.

Business is rarely about logic alone. It’s about reading between the lines, understanding moods, and listening more than you speak. Many successful entrepreneurs develop a kind of “street smarts”—they trust their instincts, ask smart questions, and pay attention to what people don’t say.

When you’re talking with someone, listen carefully to how they phrase things. Small pauses, hesitations, or strong words can reveal what matters most to them. Ask questions and resist the urge to answer them yourself. Let silence do the work—it can often lead others to reveal more than they intended.

How You Come Across

Your appearance, tone, and timing all send signals. For example, your clothes should fit well but not scream for attention. People who seem too perfect might be more focused on looking good than doing good. In business, real achievement speaks louder than polished appearances.

You don’t need to impress everyone directly. Let others mention your achievements. Avoid flattery—it feels fake. Instead, treat people the way they want to be treated. Personalize your messages, don’t waste anyone’s time, and above all, keep your promises. If you say you’ll deliver something and don’t, people lose trust—and that’s hard to win back.

Understand the System

Every company, every team, and every industry has a system—even if it’s unspoken. Your job is to understand it. Within companies, people often copy the style and habits of their bosses. Pay attention to how someone’s assistant acts—you might learn something about the person in charge.

Formal business situations usually reveal the least. People wear their “game face.” But behind the scenes, you can often learn more. A smart move is to help others without expecting anything in return—like connecting two people who could help each other. They’ll remember you.

Don’t try to be perfect. Instead, learn from your mistakes and own them. People who admit errors and move on are more respected than those who hide them or blame others.

How to Stand Out

If you’re an employee, your challenge is to make sure the decision-makers know your value—without upsetting the people between you and them. If you’re an employer, you must look beyond appearances and identify real talent.

Here are some basic rules to follow:

  • The fittest survive—not necessarily the flashiest.
  • Your peers are your allies, not your enemies.
  • There’s always a system—find it and work with it.

The Power of Asking for Help

Not asking for help is short-sighted. The smartest people ask questions, learn from others, and grow faster. Your value increases as your knowledge expands.

Leverage your time and energy. Ask: 

How can I make the biggest impact in the shortest time?

If you’re bored, it’s probably your fault. You haven’t found what makes the work meaningful—or haven’t tried hard enough to shape it into something better.

Selling Is Survival

Even if you don’t like selling, it’s essential. Without sales, there’s no business. The best salespeople don’t push—they wait for the right moment—timing and patience matter as much as skill.

In fact, many ideas fail not because they’re bad, but because they’re too early—or too late. Mature entrepreneurs learn to wait for the right time, even if it means delaying their own plans.

Try renewing contracts or asking for upgrades when the other side is happiest, not when the deadline is near. Sell to people who are either just starting a new role (they want to prove themselves) or about to leave (they have nothing to lose).

And once the sale is made, stop selling. Talk about something else—something personal or human. Over-explaining your product might make them regret the decision.

Focus on What Works

Use the 80/20 rule: 80% of your business will come from 20% of your customers. Identify them early and build long-term relationships. Also, figure out who really decides in the companies you deal with. It’s not always obvious.

Find the rising stars in other businesses and become their ally. Ten years from now, they might be in influential positions—and remember you.

When discussing prices, avoid round numbers. They feel negotiable. Odd prices seem more considered and firm. And when you’re drafting contracts, try to write them first. Avoid too much legal jargon—it can create distance. Send your proposal to the person you’re dealing with directly, not just their legal team.

Build a Real Business, Not Just a Plan

Successful businesses are built on common sense—plus the courage to act on it. Many good ideas fail simply because no one turns them into action.

Smart companies invest in training, not just hiring. Here are four basic principles to guide how you treat your team:

  • Pay them what they’re worth.
  • Make them feel valued.
  • Encourage them to think for themselves.
  • Keep work and personal life separate.

Start with modest pay. Let your employees prove themselves. Then reward them well. Motivate with both encouragement and high standards—but don’t ask anything you wouldn’t do yourself.

Time Is Your Most Valuable Asset

Time control is productivity. Once you believe that managing your time makes work better and life easier, everything else becomes more manageable.

Think of your week as 168 hours. Plan time for work, rest, and recharge. Organize tomorrow at the end of today. The same goes for weeks, months, and quarters.

Don’t let your phone control you. Make calls on your schedule, and ensure every call serves a purpose. If someone is too hard to reach, it’s usually not a technical issue—it’s a lack of interest.

Start Small, Stay Smart

Bootstrapping—building your business with limited funds—is often more effective than chasing investors. The more money you need upfront, the less likely your business will succeed.

People often say, “Don’t work hard—work smart.” The reality? You need to do both. Work smart and hard, and long. That’s how progress happens.

Finally, one last note: avoid having business partners if you can. Many of the most successful entrepreneurs went solo. The more people involved in decision-making, the more complicated things can get.

How Deep Am I Willing To Dive Into This

For me, entrepreneurship is about turning ideas into reality and sharing them with the world. It’s deeply fulfilling to build something meaningful—something enjoyable to create and that can also be financially rewarding. I’m not drawn to business for its own sake.

At the same time, making an entrepreneurial journey profitable requires more than creativity or being an indie maker. It takes rational thinking, initiative, and courage—traits I know I need to develop further to succeed and grow sustainably.

I’m not aiming to build a large corporation or climb the corporate ladder. Still, I understand the importance of knowing how those structures operate, especially if I want to offer services or products to people working within them.

Ideally, I’d keep my company small, with minimal hierarchy—bringing on only the people necessary to help with tasks I choose to delegate.

I see the ideas from business books as one end of a spectrum—something I can learn from, but not a destination I’m aiming for. My main goal is to create high-quality online tools and platforms that serve people and make a positive impact.

Credits: cover photo by Lexi Lauwers.

Disclaimer: I used ChatGPT to systemize and adapt the knowledge for this article at the comprehension level I wanted to maintain.