Build Your SaaS

In this podcast episode, Michele Hansen (Geocodio) gives us an update on Section 174 and provides her take on "bootstrapping with kids."Michele explains you can be a part of the Small Software Business Alliance, and fight Section 174. If you're in the USA, please contact Congress! In the second half of the episode, Justin and Michele talk about the challenges of balancing starting a business while you have young kids. For more on this topic, check out the last episode with Aaron Francis.For more context on Section 174, check out our previous episode with Michele.(00:12) - Welcome (01:39) - Quick refresher on section 174 (05:37) - Updates since last episode (09:04) - You can still help raise awareness (13:58) - What's happening next? (17:30) - How does this work on the accounting side? (20:19) - Anything else people can do? (22:36) - What advice do you give to people with families wanting to start a business? (26:25) - Did you try a few things on the side? (28:46) - Definition of success at the start (31:01) - Developing a business while raising a baby (34:54) - Survivorship bias in stories from new parents (37:34) - What should you consider when starting a business? (45:21) - Avoid magical thinking (51:25) - Some things are hard to think about until you experience them Thanks to our monthly supporters Rewardful.com Mitchell Davis from sixsides.co Bill Condo (@mavrck) Ward from MemberSpace.com Evandro Sasse Austin Loveless Michael Sitver Dave Giunta 🎙️ Podcast hosting is provided by Transistor.fm.📺 Learn how to start your own podcast! ★ Support this podcast on Patreon ★

Jon and Justin welcome Joshua Anderton to the Transistor team! Josh is an amazingly talented full-stack web developer (Laravel, Rails, Tailwind CSS, Alpine, and more!) He's been helping us as a part-time contractor since Oct 2022, and we're excited to have him on board full-time! In this episode, we discuss why we hired another person and how we think about hiring at Transistor.(00:28) - 150! (01:27) - Trials into paid customers (09:17) - Hiring philosophy (27:40) - Hiring Josh (31:34) - Hiring people you know (40:30) - Product updates (43:49) - Patreon supporter thanks Links:Joshua's personal siteJoshua's podcast: Getting to RamenJason Cohen's articleAcquired.fm is now on Transistor! Thanks to our monthly supporters Rewardful.com Mitchell Davis from sixsides.co Bill Condo (@mavrck) Ward from MemberSpace.com Evandro Sasse Austin Loveless Michael Sitver Dave Giunta 🎙️ Podcast hosting is provided by Transistor.fm.📺 Learn how to start your own podcast! ★ Support this podcast on Patreon ★

Jon's back from his first real vacation in years. In this episode, we discuss how we've been removing inactive accounts on Transistor, SVB, Section 174, Revin is shutting down their Merchant of Record service, SaaS sales tax compliance:(00:37) - Jon in vacation mode (02:30) - Kicking off inactive accounts (04:30) - Silicon Valley Bank (06:06) - What is Mercury bank? (13:16) - Section 174 in the USA (19:05) - Sales tax compliance update (25:56) - What could we do? (32:13) - Patreon integration update (34:57) - MyPodStudios (36:33) - Patreon Thanks Links:Matt Levin's excellent summary of the Silicon Valley Bank runIan Landsman: "This is why I don't use startup-friendly banks (Mercury, etc)"Section 174: join ssballiance.orgRevin has shut down its Merchant of Record serviceFlurly (another Merchant of Record) was shut down by StripeFrom the Revin email:“The most relevant reason [we are closing] is that the Merchant of Record model is too risky for both sellers and the MOR operator. Sellers bear the risk of platform shutdown (as seen in the example of Flurly & Stripe), and the MOR operator could potentially become involved in illicit or illegal activities quickly, which could lead to all sorts of problems.Furthermore, it became increasingly clear that the Merchant of Record model primarily appeals to small-scale sellers or businesses with questionable and high-risk business models. This presents a significant challenge as we strive to move up the market.The recent change in Stripe's risk behavior has caused us to experience issues with keeping Stripe accounts live.” Thanks to our monthly supporters Rewardful.com Mitchell Davis from sixsides.co Bill Condo (@mavrck) Ward from MemberSpace.com Evandro Sasse Austin Loveless Michael Sitver Dave Giunta 🎙️ Podcast hosting is provided by Transistor.fm.📺 Learn how to start your own podcast! ★ Support this podcast on Patreon ★

Last week's episode hit a nerve! "The idea that every small software company in the world will be able to be in perfect compliance will every foreign federal, provincial, state, and municipal government that imposes a sales tax is ridiculous. It's an impossible task.(00:11) - Follow up to previous episode (02:32) - Responses we got about sales tax (06:20) - A brief history of sales tax (08:56) - Many vendors aren't collecting sales tax (10:41) - What about Stripe Tax? (12:35) - It's new to North America (16:12) - How it affects subscription based businesses (19:30) - It's not clear who's liable (24:28) - Make it easier and gov't make more money (27:58) - What about Merchants of Record? (30:28) - Where is Stripe going? (35:17) - What are going to do now? (44:45) - Patreon supporters Broadly, there were a few different camps with the responses we received: North American SaaS companies who have been using Stripe: "Yes! Sales tax compliance for SaaS is brutal."European SaaS companies that have had to deal with VAT for a long time (many of whom use a Merchant of Record).Smaller North American solopreneurs and companies who had no idea they needed to collect and remit sales tax internationally.North American companies who have one-time sales and use Merchant of Record services.Responses from indie hackers:European: “Once again, I notice that the indie hacking community has a somewhat naïve approach to what running a business actually entails. As a European, not having a plan for sales tax is... mindboggling.”Cooper: “I think it might be a European perspective; we are dealing with VAT from day 1, so it's just one of the parts of running a business from the start, it can't really be neglected.”Edwin Saraccini: “To clarify, [for Canadians] this is absolutely new territory (Debated in parliament for years) and recently put to legislation in 2021.”Daniel Vassallo: “It's impossible to be compliant everywhere. The Kingdom of Tonga could tomorrow come up with an internet tax and require you to remit 25% of your sales to the tax office in person in their local currency. And they won't tell you about it. It's just a cost/benefit analysis.”Derrick Grigg: “How can they enforce tax collection on a business they have no jurisdiction over? Governments are shaking businesses down. I’m all for collecting and paying properly where you physically operate but collecting and remitting outside your province never mind nation is a stretch.”Derrick Reimer: “Dear Stripe: We SaaS founders are desperate for a full-stack global tax compliance solution without having to leave you for a merchant-of-record. Are you planning to solve this?”Did you know..."There are actually several different types of sales tax systems in use throughout the United States. The biggest difference is whether the seller or the purchaser is the main taxpayer. In some states, the tax is imposed on sellers, who then have the option of passing the tax along to their purchasers. In other states, the tax is imposed on the purchaser, with the seller being responsible for collecting the tax and remitting it to the state. And then there are other states where the liability for the tax is shared by sellers and purchasers." (Source)New thoughts on Sales tax complianceI still haven’t heard from anyone who has successfully migrated a “mature” SaaS from Stripe to Paddle or LemonSqueezy. These are no-gos:Can’t cause more churn.Can’t require customers to re-enter information.Can’t change our checkout experience.We might consider Paddle / LemonSqueezy if:Their fees were more affordable (compared to our existing fees it would be ~$63K year more, $5,250 per month more)Their dev experience had a better rating from the folks we know.I had heard from anybody who was at our stage and had actually migrated successfully.A few folks suggested Revin, which promises “simple global sales tax compliance for Stripe for only $499/month,” but:They have to “create a new Stripe account for your brand.”Do they own your Stripe account?You’ll lose your historical stats and revenue analyticsThe current solution we’re considering is Stripe Tax + TaxJar (and start with US and Canadian tax remittance)Thanks to our monthly supporters Rewardful.com Mitchell Davis from sixsides.co Bill Condo (@mavrck) Ward from MemberSpace.com Evandro Sasse Austin Loveless Michael Sitver Dave Giunta 🎙️ Podcast hosting is provided by Transistor.fm.📺 Learn how to start your own podcast! ★ Support this podcast on Patreon ★

The whole Transistor team got together for a retreat in Montréal. Jon, Justin, Helen, and Jason chat about the experience. What should we talk about next? Twitter: @buildyoursaas, @mijustin, @jonbuda, @jsonpearl, and @helenrylesLeave a review/comment on Podchaser; it's like Reddit, but for podcasts.Email us: support@transistor.fmThanks to our monthly supporters:Jason CharnesMitchell Davis from RecruitKit.com.auMarcel Fahle, ​​wearebold.afAlex PayneBill CondoAnton Zorin from ProdCamp.comHarris Kenny, Intro CRM podcastOleg KulykEthan GundersonWard Sandler, MemberspaceRussell Brown, Photivo.comNoah PrailColin GrayAustin LovelessMichael SitverPaul Jarvis and Jack Ellis, FathomDan BudaDarby FreyAdam DuVanderDave Giunta (JOOnta)Kyle Fox GetRewardful.comCheck out Simon and Volkan’s new bootstrappers podcast: https://shipsaasfaster.com/ Thanks to our monthly supporters Rewardful.com Mitchell Davis from sixsides.co Bill Condo (@mavrck) Ward from MemberSpace.com Evandro Sasse Austin Loveless Michael Sitver Dave Giunta 🎙️ Podcast hosting is provided by Transistor.fm.📺 Learn how to start your own podcast! ★ Support this podcast on Patreon ★

Transistor celebrates 4 years since the launch

An interview with Dave Zohrob, co-founder of Chartable podcast analytics