“What’s a bootstrapper to do?
You have to go where the other guys canʼt. Take advantage of what you have so that you can beat the competition with what they donʼt.”
said Seth Godin
Just a few words by a serial entrepreneur who has very briefly but rightly explained the meaning of bootstrapping a business or becoming a bootstrapper. We all might have some brief idea about the definition of bootstrapping, but yet let’s read and study it a little closer.
What is a bootstrap startup?
Any startup that has been funded personally by the founder’s savings or credits and has zero dependencies on venture capitals or is free from any external funding is known as a bootstrap startup.
Many successful enterprises are bootstrapped in their initial stages and are now running as successful as a company with big pocket investors or are running better than those.
- Bootstrapping is building a company from the ground up with nothing but personal savings.
- Extremely limited resources can inhibit growth, prevent promotion, and even undermine the quality of the bootstrapped product.
- The bootstrap entrepreneur retains total control of the business and makes all of the decisions.
Funds Management for a bootstrap business:
A bootstrap business gets the funds through personal savings or credits at the start, but as the business grows there might be a need for more funds. When a business starts, it can work on founders’ money for some time for initial stages. Later, it gains some customers, so the earnings are utilized to manage operating expenses.
Further, when a business experiences its growth, it can expect to gather some full-time staff, working tools, office space, and for all this, it has to have some more cash flow either through loans, venture capital, or external funding.
How to make a bootstrap startup successful?
One can never be sure of a business venture’s success or failure, but one thing to keep in mind is to make a business calculation right. There are many factors to evaluate or consider whenever starting a business and when bootstrapping a startup. So here is a list of 10 ways to make your bootstrap business successful:
1. Start with a business idea, you know.
You’re going to invest your hard-earned money saved with many sacrifices that you had been making, and using them for any business idea that you hardly know about can be a fail choice. So, it’s always a good idea to explore your options in the field that you’ve known for a long time and also can have your contacts easily for business purposes. So let’s make a wiser choice when it comes to starting a new business with personal savings.
2. Consider your budget and make a business plan.
Create a business plan around the money in hand rather than picking a model as per your wishes as it might result in spending too much money. Creating an affordable plan can help you start well, and once the business takes place, you can make considerable changes as necessary for growth.
3. Prefer a model that yields revenue flow.
Try to prefer a business model that can help you have a revenue flow, like considering a model that involves onboarding members on a minimal membership fee, selling your product or services online to give 24X7 sales. A limited budget for a business is already a setback, but you can definitely do some aggressive research and create a healthy plan to successfully run your bootstrap business.
4. Workaround barter services.
When you’re in a business model where you have your boundaries, it’s always a good idea to be smart when making expenses. Try to get as many barter deals for your business as possible, whether it belongs to any department like marketing, sales, PR, finances. Offer a service in return for your service and save yourself a lot of additional costs.
5. Find efficient teammates.
While working for your bootstrap startups, a limited budget is one of the biggest constraints in the business, and to save that, you need a smart work plan and an efficient workforce. So hire teammates who are ready to work for limited money, as it can be challenging for a budding entrepreneur to manage the workforce effectively.
6. Work remotely.
To save some rental expenses and other day-to-day costs, it is better not to consider taking office space in the initial stages of your business and should work remotely and manage to work from home only.
7. Profit Maximization.
When a venture-funded business is compared with a bootstrap startup, there is a huge difference in running both. A venture capital business already has much funding. All they expect from their business initially is to grow at a fast pace. At the same time, when you talk about a bootstrap startup, it takes a good long time and develops slowly, so the initial target should always be focused on profits to cover up any operating expenses to keep the business running.
8. Inventory Management.
When we work for a bootstrap startup where we deal with physical products, it can be a task to manage inventory in a warehouse as it will cost you a bomb. But you can have a solution for that too, and that would be to keep your connections with the suppliers strong and use your orator skills to negotiate and ask them to ship the products to the end-users directly.
9. Increase your skill set.
A new initiative comes with many responsibilities, and to always effectively handle all problems is not possible. So to keep yourself ahead in times of crisis, it’s always a great idea to work on your skillset from time to time and try to brush them up. Learn new things that can help you as an entrepreneur and directly or indirectly, your business too.
10. Individual growth.
Running a successful business involves mastering all the factors mentioned above, but it also consists of mastering yourself. It’s very crucial that while running a race like this, you do not lose yourself personally. So growing yourself personally, improving your core values will help you a lot, like becoming more careful while making decisions, accountable for your actions, being passionate about what you do, and always making advancement in your personality.
A wrap up:
It was some decent amount of information on how to own a successful bootstrap startup. Bootstrap businesses are making history and doing a successful job. Running a startup can be challenging, but you should keep yourself decked up to face all the hurdles. Always have your plan B & C ready with you, and make sure to keep running your business and covering up all your costs.
Here is a list of some successful bootstrap startups, who started small with personal savings and are now a successful giant business:
It’s always about grabbing the right opportunity at the right time. Look around yourself, observe what you can foresee as future growth, and plan as per your interest because the fair amount of research and the ability to take risks is a startup point.
To start your own bootstrap startup, reach out to Jungleworks for assisting your business ideas and providing an end-to-end solution for your startup. To know more get in touch with our experts now!