Why Compounding Growth Matters

In this episode, the founder of Practical Founders, Greg Head, shares the most powerful insights from over 165 podcast interviews and working with 40+ bootstrapped SaaS founders in his peer groups. Greg breaks down the common but less obvious traits he sees in practical founders who are quietly building valuable software companies without big VC funding.

Greg shares how frugality and managed risk-taking coexist to create compounding steady growth, creating massive long-term value fpr practical founders. And independence and doing it your way are not just luxuries but real superpowers that fuel growth. These patterns have emerged across hundreds of founders he's worked with, representing over $10 billion in founder equity value created.

For SaaS founders skeptical of VC templates and PE playbooks Greg shares what all practical founders do to grow from $1M to $10M ARR without betting it all. Are you wired like a Practical Founder?

Key Takeaways

• Frugal yet bold – Practical founders are unusually frugal in life but make well-timed bold bets inside their companies.
• Managed risk – They avoid betting the whole company, instead making small bets that can compound into larger wins.
• Compounding focus – Long-term, steady 20–30% growth creates exponential outcomes in SaaS over 10–15 years.
• Independence premium – Protecting their ability to do it their way is treated as a strategic advantage.
• Optionality matters – Practical founders value flexibility to sell, go long, or change direction without outside control.

This Interview Is Perfect For

• Founders building SaaS without VC funding
• CEOs who value control and sustainable growth
• Entrepreneurs exploring long-term leverage vs. quick wins
• Anyone who wants to understand the practical founder mindset

Quote from Greg Head, founder of Practical Founders

"The simple math of a $1 million ARR recurring revenue business that grows at 30% a year, will become very valuable if it keeps growing. ? Not crazy growth, a reasonable pace. This is the fundamental principle of recurring revenue businesses, that it's a compounding machine.

"If you grow at 30% for nine years, you'll have a $10 million business. And if you do that for another nine years, you will have a $100 million business. That's probably worth a billion dollars by that time. That sounds simple and not everybody gets there, of course, but practical founders think in this way. Steady, healthy compounding.

"We know that in the long run, the 10 years, the 20 years, compounding makes the difference. It's a healthier approach. We actually like this approach, generally speaking. We understand the math and yes, we're doing it. Most people don't really sign up for this kind of thing."

Links

• Greg Head on LinkedIn
• Practical Founders on LinkedIn
• Practical Founders website

This podcast is sponsored by Designli, a digital product studio that helps entrepreneurs and startups turn their software ideas into reality. From strategy and design to full-scale development, Designli guides you through every step of building custom web and mobile apps. Learn more at designli.co/practical.

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Practical Founders CEO Peer Groups

Be part of a committed and confidential group of practical founders creating valuable software companies without big VC funding. A Practical Founders Peer Group is a committed and confidential group of founders/CEOs who want to help you succeed on your terms. Each Practical Founders Peer Group is personally curated and moderated by Greg Head.