Unless you’re independently wealthy, you have two options when you get started: fundraising or bootstrapping. Bootstrapping your startup is not for the faint of heart, but it does come with some great advantages:
- You stay in control, with no influence from investors.
- You don’t have to spend time and effort on fundraising.
- It can take months to raise money for a venture.
- When you do it yourself, you can start right now.
- You don’t accumulate huge debt or have to worry about letting down investors.
- You’ll get creative to get the job done.
- Bootstrapping starts your team lean.
Bootstrapping does not mean that you start with zero. You’re still going to need some money and plenty of resources. Here’s how to make it all work:
Adjust your mindset
This is going to be your biggest hurdle. Rather than imagining a complete company, start thinking about what you’ll offer your customers and clients. How much do you really need to deliver that? Could you start by investing your paycheck and the time you have after your day job?
Find your resources
This is the time to look at your credit cards, savings, assets, and anything you can liquidate. Just make sure that you keep careful records. And don’t overlook sweat equity, friends, and family as ways to get your idea off the ground.
According to Angus Loten of the Wall Street Journal, one of the risks of bootstrapping is that you spend less time creating connections, making it harder to secure investors down the line. If you’re not fundraising, build those connections yourself. Join mentorship programs, professional associations in your field, and learn to network. Get to know your customers and clients.
Find external resources, not external funding
Look for bespoke business services aimed at small businesses, where you can buy help in small, affordable chunks as needed. For example, hire freelancers when you need a few extra hands on board but don’t want to add the expense of hiring.
Know when to DIY
Take a look at the everyday moving parts of your business. Where can you cut corners by doing it yourself? Cold calling, meeting with clients, and taking care of updating your social media accounts may be something you are comfortable handling yourself. Just know when to draw the line. Never scrimp on needed certifications, insurance, or legal advice or it may come back to bite you.
Watch the cash like a Scrooge
Bootstrapping can mean a smaller safety net, so hit the ground running and focus on those activities that will bring in cash. Forget pattering about with the website for weeks – get the thing live and start selling so that you can build. You can tweak and change what isn’t working as you go. Check cash flows daily to make sure that you’re earning money and covering expenses. If not, step up your marketing game.
Plenty of people just like you start a business with nothing more than an elusive dream and an itch to get away from the ordinary. Smart entrepreneurs build extraordinary businesses by starting small with what they have. A little ingenuity can help you do the same.