Shane Neman, EZ Texting, JoonBug: Solo Founder Bootstrapping Success

1Mby1M Research · 1Mby1M Case Study

Interviewer: Sramana Mitra

This interview is part of the case study-based research and entrepreneurship education work of 1Mby1M, the global virtual accelerator founded by Sramana Mitra.

Abstract

Shane Neman, the son of Iranian immigrants, abandoned NYU medical school in 1999 to join a dot-com-era startup, then co-founded Offyx, an early cloud-computing venture that raised millions but collapsed with the dot-com crash. Broke and unemployed after 9/11, Neman rebuilt entirely from scratch, bootstrapping JoonBug – a digital marketing and event-photo platform for nightclubs – as a solo, self-taught operation. Starting with a $10-per-month hosting plan and a digital camera purchased on credit, he built the original website, uploaded event information and photos himself, and experimented directly with customers before adding a partner and later a larger team.

JoonBug grew over roughly ten years into a $40 million-revenue e-ticketing and digital marketing business before Neman sold it to a competitor in 2007. Using proceeds from that sale, Neman bootstrapped EZ Texting, an SMS marketing platform for small businesses that had originally been incubated inside JoonBug to combat declining email-marketing efficacy. Operating again as the independent driving force, he refined the self-service SMS platform through direct customer experimentation, built a captive offshore development team in Ukraine, and grew the company to roughly $5 million in ARR by 2010 and about $7 million by 2012, when he sold it in a cash deal to CallFire, a similarly bootstrapped competitor that had raised institutional capital to fund acquisitions.

This case illustrates Solo Founder Success: a founder can recover from an early, well-funded startup failure by independently identifying customer problems, starting with minimal resources, learning through experimentation, and building capital-efficient businesses before expanding the team or seeking external support. Neman’s journey reflects the 1Mby1M principle that resilience, founder-led execution, and disciplined self-funding can rebuild a career and create substantial outcomes even after a dramatic setback.

Transcript of the Interview

Sramana Mitra: Let’s start at the beginning of your journey. Where are you from? Where were you born and raised? What kind of background did you have?

Shane Neman: I was born in Brooklyn, New York. My parents were immigrants from Iran in the late ’70s. They came during the Iranian revolution. My father was an architect and my mother was an English teacher. They were living a nice life there until their life was turned upside down. They escaped as refugees with nothing and came to America. They came to New York where I was born thereafter.

I grew up in New York, mostly in Queens and Long Island. After that, I went to NYU for my undergrad studies. I was pre-med so I did the entire pre-med track. Pre-med is just a track; it’s not a major.

I decided to major in computer science. That was in the mid-90s. This was mainly because of having a backup plan of not getting into med school. I was asking myself what I was going to do then and where I was going to go.

At that time, being a computer science major was not a typical thing to do. Even at NYU, the curriculum wasn’t so mature. Most of the electives that I had to take were graduate-level classes, because they didn’t have a robust program at that point.

I studied that and I spent a good part of my college career working. I was a senior-level type developer. The beginning of the dotcom boom was happening around this time. I got a taste of that life and that experience. I spent time working there getting paid a lot of money for a 22-year-old. I was working as a programmer working on pretty interesting projects, but then I went to med school after that.

I went to NYU med and let’s say within the first three months, I got recruited out of that. I made a decision to leave and go join another startup as a senior developer even though being a doctor had been what I thought would be my career course or dream.

I think my passion changed later on and I realized that software and tech were my main passion. It was a hard pill to swallow because the path to get into medical school is a difficult, time-consuming, and emotionally draining one. To give all of that was a difficult decision.

Sramana Mitra: What year did you make this decision?

Shane Neman: That was in 1999. That was during the heyday of the dot com boom.

Sramana Mitra: Soon after that the market crashes.

Shane Neman: The market mostly crashed in 2001.

Sramana Mitra: It was crashing already in 2000.

Shane Neman: It didn’t hit rock bottom until a little bit later than that but yes. In 1999, I left med school and I went to work for a startup. I was doing software development as a senior developer at a startup. These were former publishing guys who were trying to make an online publishing platform. This is more commonly known as a blogging platform now. The word blog just didn’t exist then.

Sramana Mitra: I was one of the early technology bloggers. Omalik, if you remember, was one of the pioneers of the technology industry blogging. He is the one that got me into blogging in 2005.

Shane Neman: We were way too early for it because the word blog never really came up at that time. Typepad was the first major platform to get traction as a blogging platform. We’re essentially a blogging platform with subscription and all the other things that take for granted right now. We built the product.

What happened to me during that time is a little while into that. My roommate at that time was working at Goldman Sachs. I was living in Manhattan with him. He was in the heart of the technology boom and the stock trades that were going on. He brought my attention to Citrix Technology at that time. Citrix was pretty new. Their remote desktop feature was new at that time. What they had done was they delivered a way for you to deliver a desktop remotely but also you can just do a specific app. You could use your Excel, QuickBooks, or any Window based application.

It looks like it is natively running on your computer but it is just a remote desktop where it is running on a server somewhere on the cloud when there was no word for the cloud then. No one used the term cloud.

My roommate and I decided to quit our job. I would be the CTO and he would be the finance and the business guy. During that crazy time, we went and raised a few million dollars from people who thought it was a smart idea to give that money to 22-year-olds who have never done anything like this before.

That was how it was back then. We did it. We built a company called Offyx which was an online portal for small to medium businesses. It was an app store. You could go in and you could pick which apps you wanted. At that time there was no word for SaaS either. They called them ASP.

We were considered as ASP. Even the licensing schemes for doing these things were very new. It was essentially Microsoft 365. No one was thinking about recurring revenue models and that kind of stuff. MRR wasn’t a term that people used. No one really understood how to value these things. It was very new.

We called it utilizing computing. That is how we would sell it to our customers. We would say, “Just like how you would pay your utility bill for your electricity and water, you should just be getting your computing and software and just pay a monthly fee for it. It is the most up-to-date.”

We built this AppStore dropbox where we hosted your files. It was an all-in-one portal for small to medium-sized businesses to get their apps from. In the portal, they would click on the Excel icon and it would launch Excel through Citrix technology on their desktop. It wasn’t running on their computer, it was running on our servers. Their files were being stored on our servers as well.

The whole pull was that you could work anywhere, access your apps from anywhere, and from any computer. Needless to say, we became a victim of several factors. We built a viable product. We had some early adopter customers but we were too early to get scale.

I don’t think that the general business environment was open to paying for things monthly. The dot com bubble burst so everybody in tech faded away. The money dried up. The investors didn’t keep the commitments that they made to us so we didn’t get the rest of the money.

Ultimately, we were too early for this type of technology. I had put in all the money that I had saved. My partner did the same. I was completely broke, I could not pay my rent. I had to move in with my girlfriend in Manhattan at that time.

Just getting a job as a computer programmer was not even happening at that time because the dot com bubble had just burst and the demand for developers if you can imagine was not there.

911 happened at that time as well. A lot of things converged during that time especially in New York that was pretty dark.

Sramana Mitra: Can you pinpoint the exact time for me?

Shane Neman: This was in 2001. It was 2000 when I started and then it was mid-2001 when it all fell apart.

Sramana Mitra: What did you do after that?

Shane Neman: I have to remember because it was a long time ago.

Sramana Mitra: I remember it very well. I don’t know if you know my background. I am a computer scientist from MIT. The period that you are describing – the 1994 to 2000 period – I founded and ran three startups as a founder and CEO. I remember in absolute gory detail exactly what happened on a daily basis at that time.

Shane Neman: As a side thing, that was when e-trade started. I had taken some of my money and put money into the stock market. I was watching the screen for the first time when I was 21 years old. It is a good analog to what is happening right now with Robinhood. It was almost like a game.

Sramana Mitra: The dotcom mania was totally a game.

Shane Neman: It is very reminiscent of exactly what happened to me in my 20s. It was just a number and it was a game. When it started to go down, I was saying, “Oh, it’s going to go back up.” I didn’t believe it until I was left with nothing. I was buying all these high-flying tech companies that fundamentally had no business.

What happened then is a bunch of fortuitous stuff. At that time, my girlfriend was going to college in Manhattan. She worked at some of the night clubs at night to make some money and I would go with her. I’d look around and see how they were operating their business and doing their marketing. I then said to myself, “This is all kind of backward and old-school. Why are they printing flyers and giving them to people? Why don’t they have their own websites?”

Just to give an example, they would have people going around with clipboards and asking patrons to write their name and phone number so that they could call them and invite them next time. This all looked seemingly backward to me.

I decided to see if I could do it digitally and figure it out. At that time, the only thing online was Citysearch. I don’t know if you remember Citysearch. Essentially, I built a digital platform for the nightclub, bars, and lounges to digitize their marketing.

I created one of the first e-ticketing systems because at that time Ticketmaster wouldn’t service people like that and they wouldn’t give the data out. You also have to understand that this is pre-Myspace and pre-Facebook. The name of the company is called JoonBug. I’m not sure if it is around. It might not be because of COVID decimating the entire hospitality industry.

One of the things that we did that was interesting was we sent photographers with digital cameras. Back then, the flip phone had a half megapixel camera. No one had cameras at events. We would send these multiple photographers out at these events, they would take pictures and they would give you a card. The photographers would upload those photos into our systems. We would show it the next day and then we would capture their data to let them see the photos.

That went viral. You couldn’t see the photos without registering. We had a Share function. This was pre-Myspace and pre-Facebook that we allowed the sharing of photos which would allow us to get your friend’s data. Within a year, we amassed over 1 million people into our database.

These are young urban professionals that have disposable income. These were the people that go out and buy luxury goods. That allowed us to build a website with an event directory to tell people where to go. We would charge people who had events to promote their events through service and email lists.

We were one of the first to create an Events email inside your inbox. There was no Constant Contact or Mailchimp. I had to write my own software to send out half a million emails. Cisco bought Ironport. We had to buy Ironport servers and put them into a rack and program to load balance and send emails to multiple servers.

It’s something that people take for granted right now. It is abstracted away from you with services like Mailchimp. That didn’t exist then. At least not when you wanted to do large campaigns like what we did. We were one of the first to do that. We had sponsors like Johnny Walker, Mercedes, and American Express. We parlayed that into doing our own events. We monetized our own database by doing our own events and issuing tickets.

Sramana Mitra: This is about JoonBug?

Shane Neman: Yes, I did that for almost 10 years.

Sramana Mitra: Was that a bootstrapped company?

Shane Neman: It was nothing more than me sitting and creating my own website and putting a bunch of events. I wasn’t even programmatically doing it. I was just doing static HTML. I was writing the events and updating them myself during the first month.

I got a digital camera on a credit card because I couldn’t afford one. I would go and take the pictures and upload them myself and create the scripts and database. I had a hosting plan that was $10 a month. I had to constantly upgrade that because as we went up in traffic, it was not holding up.

It started with just an idea and a simple minimal viable product. Even though I didn’t even know what that meant at that time.

Sramana Mitra: Ten years of this business, what kind of revenue level did you reach by doing it as a solo entrepreneur?

Shane Neman: We were doing close to $40 million in revenue.

Sramana Mitra: You did this as a solo entrepreneur?

Shane Neman: No. At the end of the ten year mark, we had over 100 employees.

Sramana Mitra: You started as a solo entrepreneur, and it scaled. How long did you do it as a solo entrepreneur?

Shane Neman: The first year was solo, but then my girlfriend became my partner in it. She had a lot of experience in events in particular and that is how we came to doing our own events. She would do the events portion and I would do the digital online portion. I started it and once it started building, she came in a little bit later.

I will never forget this. We had a database of all these people and I had been working to get us into the liquor companies. I remember going to them and saying, “Look we have this email list. We can do an email blast for your events.” They were like, “Okay, that sounds really great.” I said, “I can get 100 people to your event exactly the way you want it.” They asked me, “How much do you want for that?” I replied, “ I want $5,000.”

I thought that it was a lot of money at that time. They were like, “Okay.” They wrote a check for $5,000. I just couldn’t believe it, because I just thought that it was an enormous amount of money at that time.

As you know, CPM is high for those things. I didn’t really understand how it worked. As we matured, we figured it out. We had a digital ad component to our website and our emails. We had salespeople as well.

Sramana Mitra: What was the business that scaled to $40 million? You did a bunch of this and that in the beginning and experimented in many directions but, obviously, you hit a point where you found some form of repeatability in all these experiments that got you to scale. What was that repeatable business for JoonBug?

Shane Neman: The initial thing that put us on the map was doing the photos. That was what got us the data that we needed. I figured out a way to monetize the photos and this was to sell them online and print them. I did drop shipping then. That word didn’t exist then.

I found a printer that would dropship. We would programmatically FTP them our orders and they would print them and ship them for us. People would see their photos and they would buy prints of them. That wasn’t a lot of money.

We tried to experiment with how we could monetize the database and the web traffic that we were getting. We went into digital ad sales, selling email blasts, and traditional banner ads on our website. A lot of times what would happen is, we would get cues from other people on what we should be doing.

What would happen is a venue owner or brand would call us and ask us if we could do something for them. We would be like, “Wow, that makes sense. Yes, let’s do that. I will call you back. I don’t know how much that is going to cost, but let’s do that.”

From there, it was a lot of experimentation. There were a few things that we did that were total flops. We thought that we could do a dating site. It probably detracted us from ticketing, the main moneymaker that came later on.

We found that the biggest way to monetize our database was through digital ad sales, but later on it was through e-ticketing. We started to offer these venues a way to ticket their events and we would take a cut from the tickets that we sold. When you start to sell lots and lots of tickets, it starts to ramp up large amounts of revenue.

Sramana Mitra: It was like a precursor to Eventbrite, was that the business model?

Shane Neman: It was, but we weren’t as smart as them. We were just niching into nightclubs, lounges, and raves whereas Eventbrite allows you to come to their system to create and ticket your own event. It’s almost like a website builder for an event. It is a do-yourself kind of thing. We were like, “No, give us your event and we will put it on our site. We will market it.”

It was sort of Eventbrite. They got it a lot more right than we did. That was when the idea came in and we were seeing how much revenue our clients were making, so we thought, “Well, we could do our own events. What is stopping us from doing that.”

We did a few events, and we saw that it was profitable and lucrative. We started scaling it and not only sold events for other people but ourselves as well. The more events that we sold tickets for, the more data we would get and the better we would get at marketing.

Sramana Mitra: This was the business that scaled to $40 million?

Shane Neman: Correct.

Sramana Mitra: What did you do with it?

Shane Neman: I sold that company to a competitor. That must have been in 2007 or 2008. I sold the company during that time, but what happened was, in 2005, we saw that the efficacy of email had dropped a lot because we were not the only name in your inbox. Everybody and their mother at that point had a Mailchimp account. The venue had its own email list. The concert promoter had their own email list. The brands had their own email list. With this, you were getting 50 emails into your inbox and you are just deleting all of them.

The efficacy dropped dramatically for us. I was sitting there and thinking to myself and saying, “How do I get to people without doing something really expensive by doing something digitally and circumventing the inbox?”

At that time, texting had started to become popular in the United States. In Europe, it was a lot more in 2005. With more and more people getting Blackberrys, it was easier to text. It became a lot more popular. I started Googling around and doing research if there was a Mailchimp-like product for SMS, and there wasn’t.

I was really surprised. I was doing some homework to try to figure this out. I came to the realization that there just wasn’t a platform for this. There were platforms in other countries like the UK, and Ireland. It was mainly in Europe and Asia but there wasn’t anything here.

It is country-specific because you have to get connections into the telecoms. It doesn’t run off the internet. It runs off the telecom systems. This is again pre-Twilio. I decided to create a platform for ourselves.

Shane Neman: Back then, Shortcodes had just come out. Are you familiar with what Shortcode is?

Sramana Mitra: No.

Shane Neman: It’s like those five or six-digit phone numbers that you text into to get a coupon. It’s a special five or six-digit phone number, and at that time they had just come out in the United States.

It was expensive to get. It was esoteric. There was only one place that you could get it from. There were just a handful of what are called aggregators that had connectivity into the telecom system that could even take your Shortcode and get it connected one by one to every carrier.

It was a difficult and expensive process. It was a process that no SMB would ever go through. Coke or Nike might go through it through an agency, but it was not affordable for SMBs to do. That didn’t deter me. We were doing enough money for me to figure out and say that it was worth the experiment.

I built a small platform after we got our Shortcode up and running. All it did was allow you to upload a list. Text messages at that time were only 160 characters. Incidentally, that is why Twitter is only 160 characters because initially they were using a Shortcode and you could text in your tweet. I’m not sure if you knew that.

Sramana Mitra: I did not know that.

Shane Neman: It’s mimicking SMS essentially. The way that you can send in a tweet was through texting their Shortcode. It would recognize that it was your account through your phone number. I built that and I’m like, “Okay, I’m going to subsidize this by giving it to a couple of venues or brands.”

I would give them access to this rudimentary software and see where it goes. Within the first three months, I was getting calls from other people asking how to get access to the software. We looked at the numbers, and we had made some profit already. It wasn’t even meant to make a profit. It was made to subsidize our sending texts to circumvent the inbox for JoonBug. That was what it was meant to be. That was when I realized that this was a business in it of itself, so we separated that out.

I started spending a lot of time building out the platform, so that it could be a self-service type platform like Mailchimp or Constant Contact, but for SMS. That’s how EZ Texting was born.

Sramana Mitra: What year was that?

Shane Neman: That was in 2005. 2005 was initially JoonBug but, within that year, I separated it out to EZ Texting.

Sramana Mitra: So you were running these two companies in parallel?

Shane Neman: Yes. Once I had EZ Texting, I had an “Aha!” moment where just like everyone is doing email, every business is eventually going to need a website, an email list, a phone number, and a text message list. That was what I truly firmly believed. I believe that every business needs to do this. That was one of the reasons why I sold JoonBug – to focus on EZ Texting. I saw it as a better business.

Sramana Mitra: When did you sell JoonBug?

Shane Neman: It was late 2007.

Sramana Mitra: EZ Texting was initially incubated inside Joonbug and then you spun it out. Was it also a bootstrapped company?

Shane Neman: It was. At that point, my partner left and she went into the events business and did her own thing. I just did EZ Texting. I quite literally took all the proceeds that I had made from the sale of JoonBug and put it into EZ Texting. Not only that, I sold my car and got a mortgage on my house. I got really uncomfortable, let’s just put it that way.

Sramana Mitra: How much did you sell JoonBug for?

Shane Neman: I can’t disclose that as part of the agreement that we had.

Sramana Mitra: You said you were doing $40 million in revenue when you sold JoonBug?

Shane Neman: Yes.

Sramana Mitra: So it’s at least one-time revenue?

Shane Neman: I would love to tell you, because I have no secrets; but I just can’t.

Sramana Mitra: All I’m saying is that if you have $40 million, it would be very difficult for you to get uncomfortable running a business.

Shane Neman: First of all, we had some debt. Second, I had a partner. Third, you had to pay tax. Fourth, it costs a lot of money to scale a company fast. Yes, I was comfortable, but I got myself uncomfortable again.

Sramana Mitra: Was it because you put all the money that you made from JoonBug into EZ Texting?

Shane Neman: Correct.

Sramana Mitra: In 2007, JoonBug was sold, and you were fully into EZ Texting. Most of the proceeds from the sale have gone into EZ Texting, what happens next?

Shane Neman: I realized that I needed to quickly start scaling the business. I started hiring developers and salespeople. I went at it as a product-first company. I made sure that the product was so easy to use that any business owner could use it.

In the beginning, it was an educational process, because texting was so new. No one was thinking of it as a communications or marketing tool for businesses. When we first started, we would pick up the phone and cold call a business to tell them about the business and try to set up a demo. If we could demo them, that was when the lightbulb would go over their head.

They would get the text message, and they would sign up. We had a different scheme back then, but we refined it over time to a one or two-sentence email that would catch your attention. It is something very simple. I have a way that you can capture all the phone numbers of your patrons and send a text message to them to come back next time. When you say that to someone, they will ask, “How do you do that?”

Sramana Mitra: What segment did you point this towards? What was the positioning of the company?

Shane Neman: Initially, we went only for SMBs. We didn’t want to go down the enterprise route, because it’s a much longer sales cycle and there was already an enterprise company doing that. It was called Gold Pocket or something. From JoonBug, I already had experience dealing with major brands and I didn’t want to go down that route because it’s slow, clunky, and personnel-intensive.

Sramana Mitra: I understand all of that, but SMB is not a sufficiently narrow segmentation.

Shane Neman: Initially, we just went after the contacts that I had from JoonBug. These were nightclubs, bars, smaller brands, clothing lines, and that kind of stuff. I took all the data out of our CRM and started calling all those people.

We started running Google Ads, and at that time we were the only game in town. Nobody else was running it. We dominated search and we also dominated the organic traffic. When we would look at our signups, we would see what kind of businesses were signing up. We would then focus on that vertical. For example, we would get a lot of churches, religious institutions, or schools that wanted to do emergency texting. These are just examples that I am giving you.

Sramana Mitra: What kind of numbers were you seeing in your ramp-up as you were figuring these things out? Everything that you are talking about is an early journey to find product-market fit and finding segments where your value proposition resonates. How did that ramp up your MRR and ARR in that period?

Shane Neman: I am going to be honest with you. We didn’t know. I wasn’t measuring it then. I didn’t know how to analyze my company until a little bit later. I’m being straightforward.

Sramana Mitra: That’s fine. Do you, at least, remember what the revenue was?

Shane Neman: Within the first year, we were at a few hundred thousand dollars. By the second year, we were over a million dollars. The profit margins are large on these things, because all you are doing is selling software. We had some nominal expenses for the texts themselves.

Initially, we were doing pay as you go. You would buy a thousand text messages, and it would be in your account for as long as you wanted to use them. Then, you bought more when you needed more. We got more sophisticated later on as a result of SaaS becoming more sophisticated.

Part of it was the timing and the maturity of SaaS itself. We realized that the recurring model is the way to go. It is a much more profitable way to go so we switch to recurring plans. You would get a certain amount of texts per month, and if you don’t use them they may or may not rollover. It is the same concept.

That was a lot of experimentation. Just even figuring out what to call your plan and how to price your plan was done through experimentation. It’s more of an art than a science. It took a lot of testing to figure that out.

We did everything that you can imagine from listing the plan from the most expensive to least expensive – only showing you two plans to only showing you five plans and others that we tried. You have to try everything to see what works for you.

Sramana Mitra: What was the conclusion? What did you learn from those testing exercises?

Shane Neman: That also changes over time just so you know. What works then may not necessarily work now, so you have to constantly refine and change. At that time, what worked was showing the plans from most expensive to least expensive. Left to right, it’s usually least expensive to most expensive, but it worked the other way for us. We also found that for SMBs, the $25 to $50 range was palatable. That got updated and upgraded over time.

The other thing that we did is we quickly decided that it would be a better use of our time to not be hunters but instead become farmers. There is this concept of going out and doing outbound sales and that is the definition of being a hunter. Farming is doing inbound sales. We built a customer care team and a client success team. We call them community managers. We would funnel people in to sign up for a free trial.

Even that took us a few years to figure out. I figured all these out over time. A lot of times I was copying what other SaaS companies were doing too. There is no shame in that.

Sramana Mitra: No, not at all. One of the reasons that I do these entrepreneur journey series is precisely so that people can offer a perspective of what works and doesn’t work and how they go about doing what they did and how they, through trial and error, find success. This is done so that other people can copy that success. These are blueprints of what works.

Shane Neman: A lot of it was trying things that we came up with and a lot of it was copying what we were seeing other people do and being open to trying counter intuitive things. We decided that we would funnel people into the free trial and then we would call those people to welcome them and convert them into paying customers.

We tried a lot of different things where we would even experiment with the best time to call them after they sign up. Was it three hours after, the hour after, or the next day? Those are things that you need to think about. We experimented with drip onboarding emails where after they sign up, they get a series of emails that walk them through the system. That was a lot of work and challenging stuff that we were doing.

We had a real problem in finding affordable tech talent. I was in New York at this time. I bootstrapped it, so I was being very careful with how I was spending the money. In many ways that was an element of the success. It was my own money.

What happened was, we couldn’t find senior-level developers or DevOps people that we wanted. We started with trying to outsource to other countries. My senior developer at that time was from Ukraine. She was saying that she had two friends from college that were in Ukraine as well.

We started that way. We only had one developer here and we had two developers there. We figured out how to work like that. It is also important to have it where the time zones have a good amount of overlap so that you can communicate for a long time during the day.

Once we saw a little bit of success that way, my CTO suggested that we should go to Ukraine and open our office there and have our entire development team there. It sounded crazy, but it wasn’t so crazy.

I told her, “You are right. Why don’t we do that? Let’s just go and see how it works.” We went to Ukraine and stayed there for a month. We set up shop there and figured out how we could build an entire team there.

Sramana Mitra: I’ve always worked with the offshore development teams. It is something natural to me. Right from the beginning of my career, I have been using offshore development teams.

Shane Neman: There you go. A lot of times when you work with offshore development teams, they are working for the outsourcing company. Their HR, boss, email, and office are all under the outsourcing company. For all intents and purposes, yes maybe they are working for you, but they are not part of your team. There is this duality to their identity. What we wanted to do was have an easy EZ Texting office.

Sramana Mitra: Both works. We have an outsourced company that does our technical work. They are from Jaipur, India. I see what you are saying though. You did your own captive development center in Ukraine, but I think outsourcing companies work as well. I hear you, but I have seen both models work just fine.

Shane Neman: Okay. Yes, I think initially it worked really well. As a practical matter, because we were a tech company and had a tech product, it was important that the team be an EZ Texting team and not reliant on an outsourcing team. We wanted it to be the EZ Texting people. We were the ones who interviewed, hired, and paid them.

Sramana Mitra: I got it. You did a captive development center in Ukraine. Let’s move on. What happens next?

Shane Neman: I just thought that it was an interesting thing. As we are going along, we are growing 50% to 70% a year. As time is going on and years are going by, it’s getting easier to sell because more businesses are aware of this product.

This is interesting because I had a conversation with the former CMO of Constant Contact on how it happened for email service providers. Her name is Nancie Freitas. Constant Contact started doing radio ads, TV ads, and all those things were giving general awareness about these types of products that helped their competitors as well. Counterintuitively, more competition was coming, but the awareness was also building as a result. We were witnessing hyper-growth at that time. The rising tide brings all boats up. That is what happened with email service providers.

Sramana Mitra: How long did it take you to hit $5 million in ARR?

Shane Neman: It took me about five years.

Sramana Mitra: What year would that have been?

Shane Neman: That would have been in 2010.

Sramana Mitra: In 2010, you have hit $5 million in ARR and you are still bootstrapped. How many people were in the company?

Shane Neman: There were about 30 to 35.

Sramana Mitra: What happens next?

Shane Neman: Around that time, Twilio started coming out. That was when we started to get a lot of attention. We were in the space that they brought a lot of awareness to the ability of SMS. Counterintuitively again, that helped us a lot. Even though they were a competitor because we had an API product too, they helped us out. A lot of other businesses started using us. They started integrating with our APIs.

One of them was a company called CallFire. They had a similar story of bootstrapping but with five guys from India and Bangladesh. They were based out of LA. They had a calling product that was similar to EZ Texting but just for calls. They were a client of ours.

They approached me and said, “Would you be willing to sell your company?” That was in 2012. They said, “We are doing a raise and it would make sense to fold you into our service because we have a lot of calling customers that are asking for SMS.”

They wanted to compete with Twilio. They had both call and SMS APIs. That is how we got the attention. I ended up closing a deal with them.

Sramana Mitra: This was a private acquirer that raised money to acquire you. That is what happened?

Shane Neman: Yes, they raised through Morgan Stanley and Investor Growth Capital.

Sramana Mitra: How big was CallFire when they acquired you?

Shane Neman: They didn’t disclose their numbers to me, because it wasn’t part of the deal. It was a cash deal. Size-wise, they were double the size of EZ Texting based on employee count.

Sramana Mitra: You were about $7 million at this point?

Shane Neman: Yes, but maybe a little bit more than that.

Sramana Mitra: Did you get a cash exit at this point?

Shane Neman: Yes.

Sramana Mitra: Did you go to work for CallFire?

Shane Neman: I stayed for two years after that. I was the head of products. I saw the integration of our SMS platform into their platform. I also ran the EZ Texting side for them during the ramp-up period. After two years, I thought my job was done. I decided that it was time for me to move on. To give you a little bit of a background, CallFire ended up changing their name to EZ Texting. This is not what typically happens when you acquire a company, but the SMS portion is the bigger business.

Sramana Mitra: You left in what year?

Shane Neman: I left in 2015. It was late 2012 when the acquisition happened.

Sramana Mitra: Very quickly, what have you done from 2015 to 2021?

Shane Neman: I have done a lot of things, but the main thing that I have been doing has been venture investing. I have been doing a lot of venture stuff. I have done a startup of my own during COVID. That is mainly what I have been doing. I do a lot of VC. The stuff that I am doing right now is in the early stage prop-tech investing.

Sramana Mitra: We have a seed capital series where we invite investors to come in to talk about what they are investing in at our 1Mby1M roundtable.

Shane Neman: The last thing that I just did is I started a new company called 411Rx. Do you know what GoodRx is?

Sramana Mitra: Is that an online pharmacy?

Shane Neman: It’s not an online pharmacy. You can put in your prescription and it will tell you that going to the Walgreens a mile down from you is cheaper than going to the Rite Aid down the block. It will give you a coupon.

I developed something similar to that but with an AI chatbot. You converse with the chatbot and it would tell you where to go and give you a coupon that way. What is interesting about it is that it is built on top of the RCS platform, which is Android’s answer to iMessage. It’s just being rolled out right now to new Android phones carrier by carrier.

Sramana Mitra: Thank you for your time.

Key Takeaways

• Solo Founder Success: After Offyx, an early cloud-computing company that raised several million dollars, collapsed during the dot-com crash, Shane Neman was broke and unemployed. He rebuilt independently by launching JoonBug as a solo, self-taught operation, initially creating the site himself, manually listing events, taking and uploading photos, and using a $10-per-month hosting plan and a digital camera purchased on credit.
• JoonBug demonstrates the power of starting lean and learning directly from the market. Neman used event photography to build a database of more than one million users, then experimented with photo sales, digital advertising, email marketing, sponsored promotions, e-ticketing, and self-produced events. The e-ticketing and digital marketing model ultimately scaled to nearly $40 million in revenue over approximately 10 years before the business was sold in 2007.
• EZ Texting emerged from Neman’s independent observation that email-marketing effectiveness was declining and that small businesses lacked an affordable, self-service SMS-marketing platform. He initially tested the product by giving rudimentary software to a few JoonBug venues and brands; inbound interest and early profitability demonstrated that the internal tool could become a standalone company.
• Neman bootstrapped EZ Texting with proceeds from the JoonBug sale, reinvesting his own capital into product development and growth. He also sold his car and took out a mortgage, illustrating a high-conviction, founder-controlled approach rather than relying on outside investment.
• The company focused initially on SMBs and iterated through direct customer conversations, Google Ads, organic-search acquisition, free trials, customer-success outreach, and repeated pricing experiments. EZ Texting shifted from a pay-as-you-go model to recurring SaaS plans, finding that the $25–$50 monthly range was attractive to small-business customers.
• To manage costs while maintaining technical capability, Neman built a captive development team in Ukraine rather than relying solely on an outsourced vendor. EZ Texting reached roughly $5 million in ARR by 2010 with approximately 30–35 employees, while remaining fully bootstrapped.
• EZ Texting was acquired by CallFire in a cash transaction in 2012 when the company was generating roughly $7 million in revenue. CallFire later renamed itself EZ Texting after recognizing SMS as the larger business opportunity. The outcome underscores how founder-led experimentation, capital efficiency, and sustained ownership can turn a solo start into a significant strategic asset.