12th Annual


At the end of 2022, Mainsail Partners surveyed hundreds of bootstrapped founders to capture their sentiments regarding their businesses as well as broader economic trends. At that time, the macroeconomic outlook was uncertain at best. Bootstrapped founders were operating their companies amidst a declining stock market, interest rate increases, tech industry layoffs, speculation about a prolonged recession and a continuing war in Ukraine. Many of these dynamics have continued in early 2023.

Not surprisingly given this backdrop, founder sentiment regarding the U.S. economy is at an all-time low with nearly 50% believing the economy will be worse in 2023 and only 20% believing it will be better. This represents the highest negative sentiment in the 12 years Mainsail has been conducting this survey.

At the same time, this year’s survey highlighted the resilience of these founders, with the majority suggesting they will be offensive and invest to take advantage of weakened competition and market conditions.

Areas of Investment

Product development remains a top priority — a lasting Bootstrapped Survey trend.

In the 12 years Mainsail has been conducting the Bootstrapped Survey, three areas of investment have consistently been the top priorities, regardless of shifts in broader economic sentiment: Product Development, Sales, and Marketing. Product has been the top priority in 10 of the last 12 years.

Going into 2023, that trend continues. Product Development remains the #1 area of investment with 56% planning to invest in it (down from 61% last year). This is followed by Marketing/PR (46%) and Sales Staff (45%). Despite being down, product development increased in prioritization on a relative basis. The increased importance of product-led growth may be driving this increased investment in product development relative to sales and marketing — a trend that Mainsail has seen across its portfolio.

In general, plans to invest are down across the board, with a few interesting highlights:

  • Hiring (-18%) and Sales Staff (-10%) saw the greatest decrease YOY.
  • Product Development (-5%) and Technology (-5%) declined the least. (Note that “technology” refers to the tech stack that operates a business.)
  • New Market Expansion stayed the same year over year.

What are your most important areas of investment?
(2022 vs. 2021)

Mainsail Insight

“According to the survey results, the challenge of hiring talent dropped from an all-time high last year to an all-time low this year, driven by a slowdown in hiring and sudden easing of the talent market. The market for high-quality executives is always competitive, but software companies may want to take advantage of this lull in the market to hire that key executive who has been more challenging to recruit in recent years.”

– Emily Azevedo, Partner at Mainsail Partners

Staying Focused on Growth

A growth mindset still reigns among bootstrapped entrepreneurs.

There are numerous data points that indicate technology company investors and buyers are no longer valuing growth the way they have over the past decade and are instead emphasizing profitability. While this year’s survey results show that 44% of respondents are still focused on growth over profitability, this is down from 53% when we asked the same question just two years ago. This indicates that the “growth at all costs” mindset is dimming as companies seek to strike a balance.




To drive growth during periods of economic uncertainty, founders highlighted Organic Growth Channels (30%), Product Led Growth (26%) and Prioritizing Cross-Sell and Upsell into their Customer Base (26%) as the top three strategies they would pursue. Increasing Customer Retention (22%), Tightening Selling Focus on the Ideal Customer Profile (21%) and Optimizing Pricing and Packaging (20%) also ranked high.

What are your top 3 strategies for continued growth during economic uncertainty?

Mainsail Insight

"It's good to see founders prioritizing organic channels to drive growth. When done well, content marketing and product-led growth create a healthy stream of new demo requests and free trial opportunities—reducing a company’s reliance on paid advertising and lowering their CAC (cost per acquired customer)."

– Michael McEuen, Director of Demand Generation


Pricing has always been an important lever for growth for software companies, but in recent years, there has been more effort invested into optimizing pricing models to capture more value from customers. Companies are also updating pricing more frequently.

In this year’s survey, 67% of companies said they increased prices or made changes to their pricing model within the last year, and 53% said they intended to do so in 2023. By comparison, in 2019 when we asked founders a similar question, “Are you planning to raise prices of existing products in the coming year?” only 33% responded “Definitely.” A combination of evolving pricing models and inflation driving up costs are likely contributing to the increased focus on pricing optimization.

When was the last time you raised prices or changed your pricing model to capture more value from customers?

Do you plan on increasing prices or changing your pricing model to capture more value from customers in 2023?

The most common pricing models cited in the survey included “Per user/seat pricing model” (43%), “Usage based pricing” (40%) and “Good, better, best pricing tiers” (35%). Note, these are not mutually exclusive and many survey respondents implement a combination of components in their pricing model.

What best describes your pricing model? (select all that apply)

Mainsail Insight

“We are finding that software company management teams are leaning into pricing optimization more than ever. There’s no single right answer, but it is key to ensure that your pricing model is aligned well with customer value and that you are consistently testing.”

– Brian Russell, Vice President of Pricing

Preparing for Uncertainty

Most companies are planning to take advantage of the uncertainty in the market.

Given the general uncertain outlook on the economy, Mainsail Partners asked companies how they were preparing for 2023. Perhaps surprisingly, the majority of respondents (59%) indicated they are planning to invest offensively to take advantage of the market opportunity while only 16% are managing or reducing costs to prepare for softening demand. The remaining quarter of respondents said they would not change their approach despite the uncertainty.

For companies stating they would invest offensively, the biggest areas of planned investment are Sales and Marketing (87%) and Striking New Partnerships (51%); Investments in R&D / Developing More Products was close behind at 48%.

59% plan to invest offensively in 2023

Where will you invest offensively in 2023?

16% plan to manage or reduce costs

Top 5 cost-reduction measures for 2023

Bottom 5 cost-reduction measures for 2023

Mainsail Insight

Times of volatility or uncertainty are typically a good time to take a step back and optimize your technology stack and hosting costs. Start with an audit to understand what is being fully utilized, where there are opportunities to cut costs and where there are opportunities to invest to increase efficiencies.”

– Julio Palacio, Mainsail Chief Technology Officer

Top Macro Factors Expected to Impact Businesses

This year, Mainsail wanted to better understand how founders were expecting macro dynamics to impact their businesses. Inflation (43%), Managing Remote Workforces (24%) and Rising Interest Rates (16%) all topped the list of macro factors that founders expected to impact their businesses.

What do you expect to have the biggest impact on your business in 2023?

Areas of Concern

“Lack of Capital” catapulted to the top of the list of challenges founders expect to impact growth in 2023.

This year’s survey saw some of the most dramatic one-year shifts when it comes to the challenges founders are expecting for growing their business in the coming year.

At the top of the list of challenges founders expect is “Lack of Capital”, which was cited as a top challenge by 42% of founders this year, up from 23% last year. The shift is likely driven by rising interest rates and fluctuating technology company valuations.

On the other end of the spectrum, “Finding Good People to Hire” declined as a concern, dropping from 63% of respondents last year to an all-time low of 37%. While Customer Retention increased as a concern (12% from 8% last year), it remained surprisingly low on the list of expected challenges given the uncertainty founders highlighted throughout the survey.

What do you expect to be the biggest challenge(s) for growing your business? (2022 vs 2021)

What do you expect to be the biggest challenge(s) for growing your business? (2015 – 2022)

More About the Survey and Respondents

This year’s Bootstrapped Survey highlighted the ways in which uncertainty is impacting the founder journey. The results showed companies shifting internal investment priorities, increasing emphasis on profitability, and focusing on pricing model optimization — all of which mark a shift in previous trends for bootstrapped founders participating in the survey. And still, the resilience and creativity of these founders remain a constant.

Do you expect the U.S. economy to be better or worse next year?

Founders, who are typically optimistic about their own businesses, were also less confident than usual, with only 60% believing their business will grow faster next year. While this represents the majority of respondents, it is a considerably smaller majority when compared to prior years’ average of 74% of founders expecting to grow faster in the coming year.

How do you expect your business to grow next year?

Additionally, the percentage of respondents planning to hire in 2023 was 51%, down from 68% a year ago, highlighting the impact of dramatic changes in the labor market in the past 12 months.

In short, uncertainty reigned as we headed into 2023.

Will you hire more or fewer people than last year?


The survey was conducted in December 2022 and resulted in a total of 215 responses. This is the 12th annual Mainsail Bootstrapped Sentiment Survey and is intended to help us continue to understand the needs and perspectives of companies that Mainsail invests in and helps to grow. The survey was conducted via an online survey sent to software entrepreneurs and senior executives at U.S.-based companies. For the purposes of this survey, “bootstrapped companies” are defined as businesses which have taken no previous capital from venture capital firms, or other institutional investors. Qualification as a bootstrapped company was verified through a qualifying question.

What is your average ARR per customer?

How fast did you grow recurring revenue between 2021 and 2022?

What is your 2022 ARR?

What best describes your end-market?

Totals may not sum due to rounding.

This content piece has been prepared solely for informational purposes. The content piece does not constitute an offer to sell or the solicitation of an offer to purchase any security. The information in this content piece is not presented with a view to providing investment advice with respect to any security, or making any claim as to the past, current or future performance thereof, and Mainsail Management Company, LLC (“Mainsail” or “Mainsail Partners”) expressly disclaims the use of this content piece for such purposes.

The information herein is based on surveyed founders’ opinions and beliefs as well as Mainsail’s analysis of survey results. There can be no assurance other third-party analyses would reach the same conclusions as those provided herein. The information herein is not and may not be relied on in any manner as, legal, tax, business or investment advice.

Third-party images, logos, and references included herein are provided for illustrative purposes only. Inclusion of such images, logos, and references does not imply affiliation with or endorsement by such firms or businesses.

Certain information contained herein constitutes “forward-looking statements,” which can be identified by the use of terms such as “may,” “will,” “should,” “could,” “would,” “predicts,” “potential,” “continue,” “expects,” “anticipates,” “projects,” “future,” “targets,” “intends,” “plans,” “believes,” “estimates” (or the negatives thereof) or other variations thereon or comparable terminology. Forward looking statements are subject to a number of risks and uncertainties, which are beyond the control of Mainsail. Actual results, performance, prospects or opportunities could differ materially from those expressed in or implied by the forward-looking statements. Additional risks of which Mainsail is not currently aware also could cause actual results to differ. In light of these risks, uncertainties and assumptions, you should not place undue reliance on any forward-looking statements. The forward-looking events discussed in this content piece may not occur. Mainsail undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

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