Bootstrapping is the art of building your company without any external funds or investors. In a world where a lot of people automatically want to raise money to start their new company, bootstrapping seems to be avoided like a plague.
Everyone wants things to move fast in their company and only “free” money can make that happen. However, I am convinced that the bootstrapping route is a very important one and it helps to acquire certain skills.
Every Entrepreneur should have at least one bootstrapped company in their profile.
Bootstrapping helps you to think clearly and focus on what is truly importantly which is selling to real customers. Selling is HARD and when you have investor’s money, you have the luxury of delaying the selling process. You are able to lock up inside your air conditioned office pretending to be building a business until you run out of money and then have to run outside to make sales.
When you bootstrap your company, you are able to learn some high level discipline which you can barely learn if you have a pile of investor cash waiting for you. You have to find ways of achieving your goals without spending loads of money.
Bootstrapping is the surest way to build a business that stays on course of purpose. When you invite investors, especially the shortsighted and greedy ones, all they want is profit ASAP and if you cannot deliver, they can sack you and hire someone else. Yes, when you raise money, sometimes you go from visionary to “foreman”. A visionary has a vision she wants to build out, quite indispensable to the company. A foreman is the lead man of the work force, highly dispensable. Anybody can lead a workforce that is controlled by a board of directors who merely tells them what to do.
A lot of Entrepreneurs think that all they need is money to start the business, but they are yet to actually solve their business equations. When they raise the money, then they lose it and the business fails.
The only issue we all have with bootstrapping our companies is that it seem to require that we think small and start small.
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