So you’ve decided not to seek investment, and now you’re in your living room wearing your finest pajamas wondering how you’ll make it.
At first you were the envy of your colleagues when they texted you from 8:30 a.m. meetings. Soon the exhilaration of quitting your job faded, and now you’re subject to quips about your “morning commute” that don’t feel quite jokey enough.
There’s a lot to be said for bootstrapping a business, particularly as fears of a popping bubble face the technology sector, but it’s not without its difficulties.
Get personal finances in check
The most vital thing is managing burn, and that begins with your lifestyle. A business can’t function if founders don’t have a plan for their own survival. Since achieving success can take far longer than originally anticipated, a conservative plan is crucial.
When I started my first real company (after several amateur endeavors), I held a full-time job while spending my evenings and weekends on the business. Those were grueling years, but I had no financial risk. I could easily throw in the towel if things weren’t working out, and I was setting money aside which came in handy down the road.
In a later venture, I convinced my employer to pay me less and give me a three-day work week, so I could give my new business more attention. I was careful with spending (to the point of deserved ridicule), and I eventually saved enough money to quit my job and take 10 months to get my business off the ground.
This meant making groceries go further. It meant getting rid of cable, the data plan on my phone, and money spent on clothes, gadgets, and home items. To save money on electricity, I endured tropic-like conditions in my upstairs office.
You can’t afford to be choosy when opportunities come along. Funded companies have marketing budgets, salespeople, and advisors to trawl the ocean floor. You only have the fish at arm’s reach.
Somehow my first startup got invited to sponsor a music awards show in New York. The expense of going was more than our yearly budget, but someone who found us online offered to split the cost because she thought we were going to make it big.
We took off work from our other jobs, grabbed some friends to make us look like a legitimate company, drove 13 hours, and rented a limo to bring us to the show. Walking the red carpet was really intimidating, as was pretty much everything else around us. Suddenly we realized that we had no idea how to capitalize on the event. And aside from getting to present the award for best new artist, it was a total bust.
While sometimes things don’t work out, I’ve learned that luck doesn’t just show up and suddenly solve our problems. It comes in the form of opportunities for us to seize or ignore, and the only guarantee is that missed opportunities never go anywhere.
Bootstrapped companies are by nature more personal organizations. Use that to your advantage and be as human and responsive as you can.
When someone contacts our company, I try to respond as fast as humanly possible. When someone sends praise our way, I promptly respond with my thanks. Sometimes our system will log an error in such a way that I can deduce which customer had the problem, and I’ll reach out to them before they submit a support request.
My goal is to blow them away with attentiveness, which is a lot easier when you’re not dealing with all of the complexities of managing investors. Being bootstrapped affords you the luxury of focusing on quality over quantity. Once investment dollars start coming in, you’re on a different kind of timeline.