Bootstrapping Your Way to Success With These 9 Tips
What if you want to start a company, but don't yet have funding or aren't sure you want to share ownership. Is it possible to start a successful company without investors -- no angel, venture capitalist or seed funding? Of course it is, and I'm living proof you can do it.
While it isn't always easy, for many it is the road that makes sense for their current situation.
I first became a tech entrepreneur not to sell technology but to reach fellow parents. Like many "mompreneurs," I chose to bring convenience to parents. (In our case in the form of video games as apps that teach social and life skills.)
Here is a few bits of advice on how to do it.
1. Prioritize. Remember you only have so much time and money, so everything must be brutally prioritized -- with lower priority items dropped for the time being. Focus is now your mantra. Think of your top goals for the company and make these your only investments -- both with your time and cash.
2. Share equity. Try to find a co-founder and employees who will work for equity. Be generous, because sweat equity is hard earned. Offer a generous package with both the amount of equity and the vesting period. I would also suggest not eliminating the vesting period or cliff completely, or you run the risk of losing part of your company of those employees who don't live up to their promises.
3. Plan for your salary. Bootstrapping means no salary from the new business for some time. Will you work your day job at the same time or do you have savings? Will you do consulting part time? If you have children, what is your childcare? Make sure you have a plan for an extended period.
4. DIY but know when to ask the expert. Whenever possible, do it yourself in the beginning. We learned to create our own WordPress website, file our own trademark and copyrights and do most of our own product development. That said, we couldn't do this without expert advice.
Related: When to Say No to Venture Capital
For the website, we joined developer forums to answer our questions. (If you go this route, always search the history before posting new questions.) For the legal paperwork, we hired a law firm to give us advice on the applications but drafted the documents ourselves. For product development, we licensed a platform that got us started, resulting in a much faster launch than creating a product from scratch.
5. Cooperate with other entrepreneurs. You might have friends or colleagues who have started companies. If so, see how you can help each other. Trade Facebook posts or marketing leads. Give your friend tips on articles you come across that would be great for her social-media platform. Also, look at swapping skills.
6. Scrutinize expenses. Negotiate contracts. Buy cheaper pens. Fly coach, or better yet, skip that trip completely. Whenever there's a way to do something for free, try it. Be sure to tell potential vendors that you are bootstrapping so that they don't quote you inflated prices.
7. Build audience early. While in stealth mode, consider content marketing, such as a blog, to build your audience ahead of your product. It doesn't have to reveal what the product will be. For us, we developed a parenting blog before the official launch of our product.
8. Don't skimp on PR. You can have the best product in the world, but if no one knows about it, your business will fail. Reporters receive many more pitches than they can possibly write about. It's equally important to market your story to the media as it is to your customers.
9. Soft launch of first product. Even Microsoft and Apple have bugs in their first versions. The quieter launch -- whether based on the time of year or because you didn't have the capacity to build your audience in advance -- can give valuable customer feedback to improve your product.
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