Small Bets, $1.06M & Daniel Vassallo

Table of Contents

• 💼 Biz Breakdown

• 👥 Team Spotlight

• 📈 Trending

• 🔑 Key Insight

• 🏛️ Historical Ties

• ☝️ Actionable Tips

• Conclusion

"Small bets are the building blocks of success. They allow you to test the waters, learn from your mistakes, and build momentum without risking it all on one big gamble." - Daniel Vassallo

Daniel Vassallo (@dvassallo), a former Amazon software engineer, left his $500,000 per year job to become an entrepreneur. He is now known for his Small Bets philosophy, which emphasizes taking small, manageable bets and focusing on a portfolio of projects to increase the chances of success and limit the potential downside if a project fails. Something that aligns well with the micro-empire philosophy.

💼 Biz Breakdown

Daniel’s career growth has been marked by a series of small bets that have paid off. Although not all of his initiatives were full-blown businesses, they produced results often better than many startups I know.

Hosted on a well-known platform called Gumroad, Daniel earned over $140,000 for his book The Good Parts of AWS. His Everyone Can Build a Twitter Audience course, also hosted on Gumroad, brought in over $310,000. His SaaS offering, Userbase, has been less “successful,” making about $10,000 per year. However, his overall approach to entrepreneurship (dare I say, micropreneurship) has proven to be profitable and sustainable.

The Small Bets community, which Vassallo co-founded, is a key part of his growth efforts. The community, which has grown to over 4,500 members and generates over $1M per year (as of Feb 14, 2024). The community provides a platform for entrepreneurs to interact, get feedback, and support each other.

👥 Team Spotlight

Vassallo's supporting team includes Louie Bacaj, from the Small Bets community. Bacaj is a software engineer with a background in corporate and entrepreneurship. He contributed to the Small Bets community through articles and collaborations, such as co-hosting a live course on starting and succeeding with newsletters.

Other “team members” and collaborators include:

• James Clear: A writer and productivity expert (author of Atomic Habits) who’s collaborated with Vassallo on content and events.

• Nathan Barry: The founder of ConvertKit, who’s provided advice and support to Vassallo.

• James Murphy: A software engineer who’s worked with Vassallo on various projects, including the Small Bets community.

These individuals have played a crucial role in supporting Vassallo's entrepreneurial journey and the success of the Small Bets community.

📈 Trending

The Small Bets philosophy taps into the current trend of entrepreneurship as a portfolio approach — something my friend Yong-Soo Chung shares in his Personal Holding Co philosophy — where individuals focus on a diverse set of projects rather than going all-in on a single startup. This approach is gaining popularity as it allows for more flexibility, resilience, and the ability to adapt to changing market conditions.

🔑 Key Insight

Vassallo's unique approach to entrepreneurship is his contrarian Small Bets philosophy. By focusing on small, manageable risks and a portfolio of projects, he has been able to build a successful online business (and community) with limited resources and a focus on niche markets or specific products or services.

🏛️ Historical Ties

Vassallo's Small Bets philosophy mirrors the ancient Roman strategy of "divide et impera" (divide and conquer). However, while the Romans divided their enemies to conquer them, Vassallo divides his projects to conquer the challenges of entrepreneurship. This historical strategy can be applied to today's business world by breaking down large projects into smaller, more manageable tasks to increase your chances of success.

☝️ Actionable Tips

• Adopt the Small Bets philosophy: Take small, manageable risks and focus on a portfolio of projects to increase the chances of success and limit the potential downside if a project fails. This often flies in the face of conventional advice.

• Use tools like Gumroad: If you check out most of Daniel’s digital products, they’re hosted on Gumroad. Utilize tools like this to host and sell your own digital products, reaching a global audience and scaling your business. Other alternatives exist, with cheaper fees, but Gumroad is still very quick and intuitive for most creators. You pay more for the “convenience.”

• Leverage Twitter by building in public: Build an audience and promote your products on Twitter to reach a wider audience and generate more sales. This takes a longer-term approach, but the more you build in public with your audience, the more invested they becoming in your journey.

• Break down large projects: Apply the "divide et impera" strategy to break down large projects into smaller, more manageable tasks to increase your chances of success.

Conclusion

Vassallo's approach to entrepreneurship, known as the Small Bets philosophy, emphasizes taking small, manageable risks and focusing on a portfolio of projects to increase the chances of success and limit the potential downside if a project fails. This philosophy seems to have been the driving force behind his success as a micropreneur. From what I’m seeing, he’s building incredibly firm foundations for a strong [digital] micro-empire.