Bootstrapping While Scaling Your Business with SwagUp Founder & CEO Michael Martocci
In this episode, I’m sitting down with SwagUp founder and CEO Michael Martocci. Michael and I talk about his experience building and scaling SwagUp, the origins of his entrepreneurial spirit and his viewpoint on scaling culture as the organization grows.
SwagUp is an API-first platform that creates, automates, and distributes high-quality branded swag across all teams and use cases. The company—one of the fastest-growing swag companies in the industry—is on a mission to eliminate all the friction from the swag buying and distribution process.
I was a SwagUp customer long before Michael and I connected via Twitter. I’ve used the company to create branded swag for the Amplify Accelerator and Cohort programs I’ve been hosting for the last year. When we first connected, we talked about collaborating. I’m excited to sit down and talk about what he is building and what’s next for SwagUp.
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Why SwagUp Chose Bootstrapping
Many business professionals have heard the term bootstrapping at some point in their careers.
Bootstrapping is starting a company with only personal savings—including borrowed or invested funds from family, friends, and the income from initial sales. These businesses are self-funded and typically don’t rely on traditional financing methods like investors, crowdfunding or bank loans.
While plenty of venture capitalists reached out to SwagUp about potential investments, Michael decided to keep things bootstrapped. He explains, “It started out where it wasn’t even an option to raise money.” At first, his focus was solely on evaluating the market, seeing if there was room for a business, getting the website rolling, and finding customers.
Although the business began to quickly evolve as they received more and more orders each month, Michael’s viewpoint didn’t change. He shared that they were more concerned with fulfilling their influx of orders and expanding organically rather than “raising money for X, Y, and Z.”
Companies and Qualities That Work for Bootstrapping
Michael believes bootstrapping proved to be the best model for SwagUp as it provides the necessary components for success—such as not prepaying for their inventory like a typical e-commerce company.
Since products are custom-made on-demand in the swag industry, the company didn’t need to float capital to their inventory. SwagUp is paid directly by their customers, and then they pay out their vendors, so there isn’t a need for upfront capital.
Michael emphasizes that their network of suppliers with manufacturing capabilities helps SwagUp and companies with a similar model save on costs since they don’t need to make large investments in those assets upfront.
Michael and his team continue to capitalize on their momentum as the bootstrapping model proved to work successfully. “There’s also an element of this pride. We got through the hard part without raising, so why do it now?” he says. “Why bring new people in? Why add variables? And I think we all really liked working with each other, and I didn’t want to mess that up.”
The Benefits of Bootstrapping
Bootstrapping a company takes hard work and requires intentional actions at every step in your company’s journey. At SwagUp, bootstrapping has created many opportunities by creating a unique position in the market.
“You’re in this advantageous position where you don’t answer to anybody,” he says. SwagUp is a profitable business with a diverse customer set. Through bootstrapping, they can now build and scale the business the way they want without the risk of upsetting investors.
Michael understands that, while they have had significant success at their current stages of growth, it may eventually benefit the company to have investor support. But, for now, Michael and his team are proud of SwagUp and how they’ve been able to build it all themselves.
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