How 2 Brothers Debunked Startup Myths to Grow and Then Sell Their Company for Multimillions

Pop culture has stereotyped the successful tech entrepreneur as an individual who strikes it rich after getting an infusion of venture capital, and then quickly grows his or her startup into a big company by focusing on selling a product with mass appeal. But that’s not always the playbook.

Take the experience of Chris and Dave Sinkinson, two brothers who built a software as a service (SaaS) custom personal safety mobile app company called AppArmor from their Queen’s University dorm room while getting their MBAs and then sold the company to Rave Mobile Safety for $40 million in 2022.

They turned conventional wisdom on its head while growing their business. Now the brothers are keen on debunking startup myths and misnomers so other entrepreneurs can learn from their experience. In their new book, “Startup Different” (Page Two Publishing), they offer a blueprint on how to build a multimillion-dollar business using a practical and principled leadership approach.

“Starting a business is an emotional roller coaster and you face a lot of challenges,” said Dave Sinkinson, AppArmor’s Co-founder and former CEO. “There are a lot of people skeptical of you.” As he explained, the key is to hammer away at building a brand and market share, while developing a strong corporate culture based on empathetic and collaborative leadership that differentiates your business from rivals. That eventually will help you be successful.

The story of how they did it involves debunking startup myths many entrepreneurs swear by.

Myth #1: You need an angel or venture capital investor to fund your startup.

Reality: Not true. You can bootstrap your business by plowing revenue back into the business to use for growth capital. This is especially true for software businesses that are not making a capital-intensive product, the Sinkinsons said.

In AppArmor’s case, the brothers launched their business as a side hustle in 2011 and never sought venture capital funding. Instead, they had a couple of other software side hustles that brought in revenue. They used that money as working capital to get by until their safety mobility app started getting purchased by hospitals and universities — like the Mayo Clinic, University of Florida, New York University, and Texas A&M University — that wanted to use the product on their campuses.

“We never wanted to raise venture capital since we heard a lot of horror stories from other entrepreneurs,” said Chris Sinkinson, Co-founder and former Chief Technology Officer of AppArmor. “It’s hard raising funding; and once you do you have to spend a lot of time managing your investors who are just focused on short-term objectives so they can reap returns quickly.”

“We knew we needed time for our market to develop and we didn’t want them crushing our dreams,” Dave added.

According to the founders, instead of focusing on getting funding, it is best to focus on customer acquisition. Funding permanently alters your business model, culture, and product — and not necessarily in good ways, they said.

[Read more: How 4 Entrepreneurs Are Making Millions on Amazon as Third-Party Sellers]

Myth #2: A niche product idea doesn’t always pay off.

Reality: The opposite is often true. Sometimes a niche market needs a product that solves a problem really well, according to the Sinkinsons. Going after such a market is easier for a small company, especially if it’s being overlooked by large corporations.

While studying at Queen’s University in Ottawa, the founders saw a real need for an app that allows students on campuses to notify security response teams of any problem by simply pressing a button on their phone. So they homed in on developing a customized end-user safety app for the school. There wasn’t a product like that on the market back in 2011 when they launched the business.

“Bigger markets are harder to penetrate if you are a small business with low credibility,” Dave said.

However, as Chris explained, over the longer term, you can sell more into that bigger market base with new products or enter adjacent markets that can also benefit from your product.

That’s what AppArmor did. After targeting university campuses that wanted mobile security for students, it marketed its product to schools and hospitals across the country.

[Read more: 3 Businesses Get Creative to Counter Mounting Customer Acquisition Obstacles—And Win]

Myth #3: Co-founders often butt heads, which is bad for business.

Reality: It’s best to share duties and responsibilities with a partner in leadership with different but complementary strengths.

While building AppArmor, Dave was the sales and marketing guy who was a good leader, while Chris, a software and product developer, was the Chief Technical Officer.

To avoid disagreements, the brothers had a framework. To resolve issues, they used data to examine what was going on and then used a consensus approach.

“We never tried to force one another to do something or break a deadlock by voting. Instead, we kept talking until we could find common ground. This requires an open mind,” Chris said.

Myth #4: Creating a culture for your startup is easy.

Reality: You need to foster creativity and innovation, which are especially important for a startup. You also need to be an empathetic, collaborative leader, not a faux-alpha. This will help boost employee loyalty, the brothers said.

This is hard to do, according to the founders. As they learned, every company’s culture is unique and it’s not all foosball tables and beer kegs.

“At first, we tried to replicate the culture at Netflix since it had good reviews, and many other startups were following it. But copying another company’s culture doesn’t work. It alienates the staff in the process,” Dave said, noting they lost their only two employees at the time as a result.

After that failure, in 2015, the founders came up with five guiding principles for AppArmor’s employees: deliver quickly, deliver quality, thrive on freedom, leave your ego at the door, and act in our best interest. In addition, they made sure the staff knew that every customer is just as important to the company regardless of how much they paid.

“Always remember, your culture is a fundamental strategic advantage in the marketplace because it is difficult for rivals to replicate,” Chris pointed out.

Myth #5: Your product is so awesome that it will sell itself.

Reality: You need to keep your focus on sales from the get-go. Many tech founders tend to focus on making their product, not selling their product. But even the best products will not sell themselves.

You need a strong sales team and good distribution channels in place for sales to grow. How well the product is sold will determine success.

Keep in mind that there is no silver bullet in marketing.

AppArmor’s co-founders found that out through trial and error. They tried a host of things to see what worked. They went to conferences and trade shows, launched direct mail and social media campaigns, and used referral programs.

“We learned that you need to have face time with clients,” Dave said. “It helps legitimize your product. Going to conferences and trade shows are a must.”

Myth #6: You need to shop your company around to sell it.

Reality: “If you're running a profitable, systematized, and growing business, buyers will come to you. You don't need to shop your company. Venture capital, private equity, and strategic competitors will see you and come knocking,” Chris said.

This is especially true if you have a great product and you operate your business with a moral compass, according to AppArmor’s founders. As they explained, they competed fiercely in the marketplace to win business, but they did it fair and square. There was no mudslinging, disparagement, or business-by -litigation against competitors.

“This approach generated a lot of respect for our company from our customers and rivals. Investors and others took notice,” Dave recalled. “In 2022, when Rave Mobile and its investor group were looking to boost their competitive position in the marketplace, they came to us with a buyout proposition that we couldn’t refuse.”

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