The potential to bootstrap is everywhere
31st October 2017
Bootstrapping has become a popular and meaningful term for start-up businesses over recent years. It also ‘does what it says on the tin’; bootstrapping is really all about shaving as much as possible off of your overhead costs (while spending nothing) by begging, stealing or borrowing from suppliers, family and friends (or whom ever will listen!) Whatever it takes to keep the business overheads as low as possible in the early days is vital.
A question many ask is, should a start-up borrow money when starting out? Yes of course, as cash is what you need to start your business but only if you don’t need to put your house and family’s future on the line in the process. Financiers will want the collateral but supportive investors will take a punt. Borrowing (financiers) is always better than shares (investors), but the risk factor is clearly higher with borrowing because at some point, someone will want their money back with interest (or your house if you haven’t protected yourself properly).
The potential to bootstrap is everywhere; borrow manuals/contracts and rewrite them, use someone else’s cash and equipment if you can by borrowing them, and always think three times about spending every single penny. If you are bootstrapping, you are watching your cash like a hawk. Launching a new business takes courage, as does the whole bootstrapping concept (which is usually easier said than done, but if you don’t ask you will never get). It is easy to spend money, far easier than it is to save it. It is also easy to convince yourself or to be convinced that you need to spend money on something. If bootstrapping is going to work for you, you have to be tough on yourself and tough about every financial decision you make. Understanding where you should spend your cash is one part of ensuring your bootstrapping approach works in the longer term, timing is the other one.
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