Why Being Bootstrapped Is Better In Early Stages Of A startup

Opinions expressed by Entrepreneur contributors are their own.
You're reading Entrepreneur India, an international franchise of Entrepreneur Media.

Early stage investing is a rife with dubious character, it’s a ball-game where you need to strike a perfect balance between knowing where to invest and where not to. One end lets you grow organically in your business and the other end keeps a tight check of your product and productivity simultaneously. They say that the best time to raise funds is when you do not need it and more often than not the early stage startups get too consumed in investor meetings loosing focus from their consumers.


In the early stages of a startup, particularly the first 18 - 24 months,  when you need to work with limited money,  co-founders become far more resourceful in their ability to multi task, and take on work that they may not have had there been more funds at their disposal.

The key benefit of bootstrapping is that it leads to innovation on all fronts. Everyone attempts to think of ways to solve a problem at a low cost, whether this is through hiring freelancers or interns but everyone is constantly thinking out of the box. We found it is very useful to use freelancers for some tasks, rather than hire a full time resource. Whether that was content writing or digital marketing.

Very often when a startup gets funded too early, money is ill spent, and often goes in frivolous marketing activities, or even in the décor of the office, when the need is to understand that you are now working with someone else’s money and that they need to see an ROI.  When you bootstrap you know exactly how far each dollar will take you.

Another one of the pitfalls of being funded too early is that co-founders behave as though they have achieved a major victory, and declare their startup a success, whereas this is truly where the journey gets difficult. If you have bootstrapped, you understand exactly what resources are really required, and what resources can wait, for you to reach your next business milestone.

In our journey as a startup we managed this well by focusing on the Delhi NCR region for a pilot project, thereby focusing only on hospitals and doctors in this location. This did not hamper our growth or vision, as we continue to serve patients across India.

In our experience, we realized that initial bootstrapping increases your leverage for future fundraising. Investors would want to invest in your company when you are bootstrapped, profitable and growing as they can be double sure of the money they bet on you!

Be it fundraising or bootstrapping the core idea will always be of innovating and developing the product that adds value to the consumer’s life.