First of all, what does it actually mean to ‘bootstrap your startup business’? To bootstrap your business essentially means to put up your own money and assets to start your startup business without external funding. It’s not easy to do, but it’s incredibly rewarding. Building a startup from the ground up is a challenge faced by every budding entrepreneur. To be successful in any business, an entrepreneur needs to use the available resources at his disposal while limiting the borrowing of funds.
Having a viable business idea is one thing. But, actually getting out there and building a self-sustaining, self-funded business is an entirely different thing. Lending money to small businesses is a highly regulated process, and this can make it difficult for small businesses to access finance, as funders expect them to meet certain criteria. Bootstrapping your business maybe the only solution and the cure to the startup funding challenges.
Entrepreneurs can bootstrap their businesses in one of the following ways:
Use your Own Capital and Resources
Before even starting your business, you should earn some form of income. and save up what you need and strategize on what it’s going to take to bootstrap your way to success. You need to raise enough money to form your company and work on your product in the first place. Failure is part of running a business and there’s nothing worse than owing people money, especially friends and family that lend you capital to start your business. If you believe that you have a viable product then you should be willing to risk your own capital and resources before even thinking about approaching investors.
Choose a Field or Industry you know
You need to have inside knowledge and good industry knowledge to make a success of any startup business. Stick to something you know and use the knowledge and connections you have to make a success of your startup venture. Whatever your industry, getting to know other experts in your field is one of the best ways of making sure that your business is successful.
Enter for Business Competitions
If you own a great business and you believe it has the potential to grow and scale in the future. This is the best way to test if your product or business has what it takes to get a buy-in from investors. Business competition events is a safe way to get business funding without having to relinquish your equity.
Negotiate Everything and Never Take Things at Face Value.
The truth is that everything can be negotiated. Get used to people saying no and remember that no is beginning of a negotiation not the end of one. You need to cultivate good relationships with your suppliers and use your charm and personality to get what you want. It will not be easy at first, but once you establish connections, they will be more than happy to accommodate you. The difference of that you get from negotiated discounts adds up and when you’re bootstrapping, every extra cent counts.
Wear Many Hats
Startup labor/operating costs can be very high, so you can’t afford to hire people that expect a steady paycheck. In the beginning, you have to roll up your sleeves and get your hands dirty. Be prepared and be wiling to play many roles such as Sales and Marketing, Customer Service and Operations, Finance and Accounting, Inventory Management. and other typical business function required for a startup business.
Go Online and Work from Home
Like most people, a fancy corner office and CEO door sign looks appealing but as startup your main focus should be having a positive cashflow and growing the business. Many entrepreneurs find it hard to sustain their businesses at the start especially when the returns are lower than expected. Based on your type of business, If you can comfortably work from home and provide all the services that your clients need, try and take advantage of existing technology and software that can enable your startup to run online and work from home. A virtual office space is a cost-saving measure without the need to invest in an actual space like buying or renting commercial spaces that require upfront investments.
To start a business and bring it to successful fruition takes a sound mix of confidence, risk tolerance, self-discipline, determination, and competitiveness. Bootstrapping is not for everyone. It takes a lot of guts and a strong work ethic to make it work. However, it is the best way to start a business without all the drama.