Bootstrap Financing Your Way To Business Success

There's a really easy way to make your idea into a reality: Bootstrapping. This is how successful startups do it -they start without any outside financing, instead leveraging what they have available to them. In this post, we'll share some tips for bootstrapping your startup and getting the most bang for your buck so you can get off the ground quickly.

Bootstrapping has never been more viable than it is today with the advent of new technologies and innovations in modern business models. To bootstrap a business or product, you usually take a little longer to get the product off the ground, but you also save so much more money by spending less on investments and other means of financing.

Imagine an inventor who has a new idea for a product like Uber, but instead of taking money from venture capitalists (VCs), he decides to finance his idea using alternative methods.

One way is through friends and family. Once you have your product idea down, talk to everyone about it. If people are excited about it, start talking about ways that they can help pay for it so you can get started. Maybe your family will be willing to help you raise the funds you need to get started.

Another way you can fund your business is through crowdfunding. If people really like your idea, they may be willing to invest money in it. Whether by finding equity money or using a crowd-funding platform, these platforms will allow you to avoid seeking financial backing from VCs or bank loans and instead raise the necessary funds from your customers, who become investors.

You should also focus on reducing costs. The key to bootstrapping is identifying where you can cut costs so that you can spend as little as possible on your endeavor while still achieving optimal results.

To do this, you must constantly come up with new ways to reduce costs. Do you really need that extra staff member? Can you outsource some of your functions to a third-party provider? Can you get by using simpler equipment or doing without certain types of gear entirely? Can you negotiate better rates with suppliers or service providers?

As your business grows, be sure that every new team member is bringing value. Otherwise, the only thing they're bringing is a bigger bottom line for the company instead of actual value for the customers -and you can't afford to have any more fat on the budget than absolutely necessary.

As far as cash flow goes, try to keep it moving. If you don't have the cash on hand to pay your employee, the best thing to do is stop working on your project until you have been able to secure an investment. While you wait for funding, try to find ways to save money or reduce costs.

Bootstrapping has never been more viable than it is today with the advent of new technologies and innovations in modern business models. To bootstrap a business or product, you usually take a little longer to get the product off the ground, but you also save so much more money by spending less on investments and other means of financing.

Imagine an inventor who has a new idea for a product like Uber, but instead of taking money from venture capitalists (VCs), he decides to finance his idea using alternative methods.

One way is through friends and family. Once you have your product idea down, talk to everyone about it. If people are excited about it, start talking about ways that they can help pay for it so you can get started. Maybe your family will be willing to help you raise the funds you need to get started.

Another way you can fund your business is through crowdfunding. If people really like your idea, they may be willing to invest money in it. Whether by finding equity money or using a crowd-funding platform, these platforms will allow you to avoid seeking financial backing from VCs or bank loans and instead raise the necessary funds from your customers, who become investors.

You should also focus on reducing costs. The key to bootstrapping is identifying where you can cut costs so that you can spend as little as possible on your endeavor while still achieving optimal results.

To do this, you must constantly come up with new ways to reduce costs. Do you really need that extra staff member? Can you outsource some of your functions to a third-party provider? Can you get by using simpler equipment or doing without certain types of gear entirely? Can you negotiate better rates with suppliers or service providers?

As your business grows, be sure that every new team member is bringing value. Otherwise, the only thing they're bringing is a bigger bottom line for the company instead of actual value for the customers -and you can't afford to have any more fat on the budget than absolutely necessary.

As far as cash flow goes, try to keep it moving. If you don't have the cash on hand to pay your employee, the best thing to do is stop working on your project until you have been able to secure an investment. While you wait for funding, try to find ways to save money or reduce costs.

To Bootstrap Your Startup, Here Are Some Tips

By: Matt Gardner

There's a really easy way to make your idea into a reality: Bootstrapping. This is how successful startups do it -they start without any outside financing, instead leveraging what they have available to them. In this post, we'll share some tips for bootstrapping your startup and getting the most bang for your buck so you can get off the ground quickly.

When starting your own company, one of the first decisions you make is whether to bootstrap or not. This means whether you will start a business on your own, without any outside money from investors, or seek outside funding.

The pros and cons of bootstrapping are pretty clear and easy to understand. If you choose to bootstrap, there are limitations on what you can do because you have no money to spend. The plus side is that once the company gets up and running, it will be self sustainable because no one else has any control over it.

Likewise, if you seek outside investment money early on as a startup company then everything hinges on the success of your new business venture. You will likely have a board of directors and investors who will expect you to meet certain milestones, grow the company and make improvements . . . which means that you cannot take risks or try crazy new ideas.

The game is either a win-win or a lose-lose. But what if you don't need investors to start your business? What if the idea for your company is so unique that people are willing to pay for it? What if you're just not confident about asking friends and family for money?

Perhaps you feel more comfortable with a smaller investment, one that doesn't need back royalties or growing into something too complex. You may also decide to use whatever resources are available to do your own financing.

Conclusion

The key to bootstrapping is identifying where you can cut costs so that you can spend as little as possible on your endeavor while still achieving optimal results. Do you really need that extra staff member? Can you outsource some of your functions to a third-party provider? Can you get by using simpler equipment or doing without certain types of gear entirely? Can you negotiate better rates with suppliers or service providers?

As your business grows, be sure that every new team member is bringing value. Otherwise, the only thing they're bringing is a bigger bottom line for the company instead of actual value for the customers -and you can't afford to have any more fat on the budget than absolutely necessary.