439: The Increasing Risk of Building in Public

**Arvid Kahl** (0:02)
Hey, it's Arvid, and this is The Bootstrapped Founder. Building in public, I want to talk about that today. It once helped me to sell my company, and today, I think that same level of transparency that I used and built in public with a couple of years ago, four, five, six years ago, but it's been a while, that actually I think can destroy your company if you employ the exact same way today. And I think that's not hyperbole. I owe my entire career as a writer, as a podcaster and a founder to being pretty much radically transparent about my business. I shared my Stripe-verified monthly recurring revenue with the world and that visibility back then in 2018-19 attracted financial and acquisition interest that ultimately led to the sale of my previous software business, FeedbackPanda. I talk about this in the very first episode of this podcast too. And that exit put me on the map. It gave me financial independence. It's the reason I have a podcast and a newsletter to begin with. If it hadn't been for building in public and sharing my numbers, I probably wouldn't be speaking or writing to anybody right now. So when I tell you that the game has fundamentally changed, I need you to understand that I'm not saying this from the sidelines just observing. I'm saying this as somebody who benefited enormously from this old playbook. And I'm now watching founders follow it straight into danger. So that's why I want to talk about building in public and the risks that come with it today. When I first encountered the idea of building in public around five years ago, six years probably, it was all about transparency. You shared your numbers, you shared your strategies, your tactics, and you let people see behind the curtain, it worked. It built enormous goodwill for founders. It created buzz for their products and was kind of a form of validation too. People bought into your journey and then they became part of it themselves. They amplified your story. They became early adopters.
And they took risks on your unfinished product because they believed in you and what you were building.
And while this aspect of building reputation and demonstrating expertise in public is still an ongoing way for people to participate in our larger community, the founders, the entrepreneurs, the means of what building in public constitutes have changed quite a bit. It's kind of the advent of artificial intelligence in particular, but also the increasing scrutiny and public awareness on social media that have made things quite different. The risk of being copied. That's the big thing in building in public, right? It's always existed. Once you share, once you talk about something, people listen. I wrote about this a couple of years ago after analyzing when founders dropped out of the building in public race. I kind of wanted to see, can we time this? Like, when do people stop? And there was a clear pattern there. Companies stopped reporting their financial metrics and sharing their specifics about what exactly they were building. Just around $20,000 to $30,000 in monthly recurring revenue. That was the threshold then. And below it, risk was manageable. You weren't big enough to be worth cloning. And the upside of sharing, getting early adopter customers from your peer community and attracting innovators willing to give your product a chance, well, that outweighed the downside of maybe having somebody try and clone your business. And above it, above $20,000 to $30,000, the likelihood of inspiring somebody to build a competitor was just too high. And the return on sharing was too low to justify this kind of exposure. I think this particular threshold has effectively collapsed to zero, or is on its way of collapsing to zero. I would argue that the day the first CLI agentic coding agent found its way into a large enough group of people, the day that it started being shared as the way forward for software engineering, was the day that building in public became not just risky, but outright dangerous. I can tell you this because I've seen it happen. It's not theoretical anymore. Here's what a savvy business-minded person can do today. They don't need to know how to code. They don't need to do this extensive market research. They don't even need to understand the tech stack. They just need a monthly subscription to an LM company, and the ability to phrase a prompt clearly. Something like investigate everything that this particular person has ever said on social media about their business over the last six months, distill it into a report, then create a free trial on their software platform, go through each page, take screenshots, do a full semantic and HTML analysis, write a report on the product, create a style guide, create a reference document explaining the business and its ideal customer profile based on how the landing page talks about them, then build a product that does the exact same thing, maybe with a twist, something in addition to the existing product that it doesn't already do, using a framework that comes with production ready payment and authentication systems. That's the prompt, and then they press enter and stuff happens. Now obviously, this isn't going to do a one-shot perfect copy, but if a business-savvy entrepreneurial developer uses this, it might take them a couple of days to build something, maybe a couple of weeks to turn that prompt from a wish into a pretty solid reality. And if they understand paid advertising better than you might, if they already have distribution in your market that you don't, or in an adjacent market that you wouldn't even think about, some leg up they might have, then all of a sudden there's a new competitor in the field that you have to deal with. One that you essentially helped create by talking about all these specific things.