No Startup Funding? Follow These Tips to Bootstrap Your Dream
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I’m often asked the same question again and again whenever I attend a seminar. And this million-dollar question is ‘how can I get startup funding’? To tell you the truth, this frequently asked question doesn’t irk me at all. But what really baffles me is the answer of the participants when I ask them which stage of business they are in. In most cases, or I’d say 99.9% cases, they haven’t started yet.
You have a dream and you want to turn it into the reality, isn’t it? Do you really need VC funding to get started? No, you don’t. If you’re really passionate about your dream, why don’t you bootstrap your dream? This is how I built all my businesses. I can do it, so can you. Take up a full-time job and fund your startup; do a part-time job and fund your startup; spend your saving as I did. But start your journey. Don’t wait for startup funding.
Though it seems like the path to success to have startup funding, bootstrapping your dream offers many advantages, such as maintaining control of your dream, realizing your strengths, and striving to stay profitable.
“When you bootstrap, you are forced to get good fast. As humans, we prefer to put in only as much effort as we need to, but whether we recognize it or not, we all have extra gears,” says Ryan Smith on Harvard Business Review.
Also, bootstrapping gives investors an opportunity to understand that you are serious about your dream.
Here are four ways that have helped me not only sustain but also stay profitable without startup funding.
1- Make Every Penny Count
The first and foremost rule for successful bootstrapping is to make every penny count. You need to be a good accountant and keep a vigil on every penny you spend. That being said, you don’t have to have a big office initially, you don’t have to throw lavish product-launch parties, and hire the biggest PR firm in your town.
Google started in a garage, and Facebook started from Harvard dorm. Do you really have to start big to make it big? Whether you have got big startup funding or you are bootstrapping, you need to reduce cost. This is the only way to make a sustainable, profitable startup.
2- Keep a Small Team and Hire More Interns
If you want to bootstrap your dream, never go with the classical portrait of the successful CEO - big office and big team. Having a big team is expensive. More people means much more money you need to spend. My friend, hiring too fast can be inimical. So, you should keep your team small initially.
I would suggest that you should hire more interns than regular employees. Hiring interns not only saves you a boatload of money but also bring a fresh perspective in your startup.
Take passionate interns on board, which will help you discover future employees.
3- Use Social Networks to Reach Your Audience
No matter how unique your product is, you will have to reach your target audience to promote it. People are not going to buy your product or service just because you are passionate about it. They need to be convinced that what you offer is the best solution for their problems. And the only way to do so is to reach them and educate them.
Needless to say, you need a big startup funding if you want to target your audience with traditional marketing channels, such as TV, radio, and print media. What’s the solution then?
Use social media to target your audience. Not only you can save tons of money but also you can reach a wide audience with social media.
At the initial stage of your startup, you don’t have to hire employees for each and every process. You should outsource tasks to keep the operating cost minimum. Outsourcing offers many benefits, including an access to skilled workers, more time to focus on core business activities, and reduced operating cost.
However, you should approach outsourcing the right way. Else, you will run a risk of losing money. Outsourcing tasks just because your competitor is doing is not at all a smart decision. You should decide what you should outsource based on the nature of your business.
Building a profitable, sustainable startup without startup funding is not an easy task. To run a successful startup, you should follow certain steps to keep going smoothly.
If you keep a small team and take more interns on board, employ the power of social media to target your audience, outsource unimportant work to reduce operating cost, make every penny counts, there is no reason why you wouldn’t be able to bootstrap your dream.
What about you? Do you want to share any tip for bootstrapping? Do leave it in the comment section. I’d love to hear about it.