In today’s robust startup ecosystem, we are encountering more and more success stories of organisations that are on the course of scaling and becoming sustainable. Stepping onto the entrepreneurial path, while some consider raising funds the most conventional wisdom,others prefer to scale it entirely from their own pockets. They plough in their own capital and pour every hard-earned dollar into their venture.
Speaking from an insider’s perspective and having a bird’s eye view of the scenario, bootstrapping is a painful as well as dedicated route. It requires continual focus and never-ending willingness to get creative about conserving and maximising resources.
As a startup founder of a CRM software company, I too had to battle the very first question, which was to go bootstrapped or raise funds for my business. Going with the most likely option, my first goal was to bootstrap the company into profitability. However, nothing prepared me for the experience I gained as I traversed the uncharted terrain of entrepreneurship. The learnings were immense, diverse, and even overwhelming.
During the initial years, to keep your company running, most of your profit gets re-invested back into operations. When you are strapped for cash, you need to look out for resources at very low rates. This includes office spaces, marketing plans, leasing equipment, or flexible rental arrangements. As a result of these trends, we see so many companies bootstrapping by using Starbucks as their meeting rooms.
PS: I did that too!
However, nurturing your company and watching it grow from infancy into a substantial entity is an exhilarating experience.
Bootstrapping indeed gives you the freedom to focus on your business and its growth, with the benefit of not having to answer to anyone. Nevertheless, freedom is also associated with a greater sense of responsibility. Freedom that leads to loss of focus on key goals is definitely a red flag. As an entrepreneur, you need to be persistent, profit-oriented, and working with tight operations with clear goals and a plan for growth.
By running a bootstrapped business, you might not witness the accelerated growth you expected. Being bootstrapped means every penny you spend must be carefully monitored and analysed. While profit is not the only viable metric for sustainable growth, your focus should be on slow yet steady growth, which requires persistence, grit, and a positive outlook even when things seem grim.
Bootstrapping can be a lonely business. Working on shoestring budget, you don’t have enough cachet to attract high-profile talent. I know because I have spent countless hours trying to single-handedly run various operations. Admittedly, it’s hard, but it forces you to get creative and come up with solutions you would never have thought of. Moreover, the good news is that you are not alone.
Considering all the revelations and hardships I encountered on this journey, I can vouch for the fact that what matters is a great product. A customer always falls in love with a great product.
(Disclaimer: The views and opinions expressed in this article are those of the author and do not necessarily reflect the views of YourStory.)