The most commonly asked question about startups is always to do with money. People want to know which investors to approach and how to best approach them. But what a lot of new entrepreneurs seem to ignore is the fact that not all startups attract funding straight away; a lot of new businesses have to go down the self-funding route or bootstrapping as it is known.
Don’t get us wrong, this is can be a fantastic route to go down and one that has major advantages further down the line, should you survive and succeed. You see, not only will you retain 100% equity and 100% control over your company, you will also be more attractive to investors because 1) you are risking your own capital and 2) you will be able to show how much progress you have made off your back when it comes to seeking investment to help your expansion. But that doesn’t mean it is easy.
Nope. Bootstrapping is hard. It is tough and challenging and, at times, a battle for survival, which is why we have come up with some survival tips.
Go Into Business With Someone
Launching on your own is not only hard but unwise. You will want to have a co-founder there alongside you, someone that can give you a second opinion, and someone that can complement your skill set. When you are bootstrapping you are forced to wear every hat you can think of to save money. You are every department, so pick a co-founder that can make up for your weaknesses and bolster your strengths.
Make Sure You Make Money Fast
You may think this is a stupid thing to say because it is so obvious, but some business ideas are better equipped to generate cash than others, so make sure you a business model that celebrates this. The last thing you want is to see your stockpile of cash get used up before you see any returns.
Only Outsource What You Can’t Do
Money is tight and the risks are high, that is a fact. So when it comes to outsourcing certain tasks, make sure they are tasks you absolutely can’t do and make sure you get the most bang for your buck. If you know nothing about SEO then, yes, it is worth speaking to an expert like LdSEOSydney.com.au. If it is designing a logo then why not approach a graphics student. If it is about your taxes then bring on a bookkeeper for two days a month. Whatever it is that you are outsourcing, though, always make sure you pay attention because you won’t want to miss out on any organizational learning experiences. Nothing is impossible to learn, remember that.
Keep An Eye On Your Cash At All Times
Clarity and transparency are absolutely critical to your success. On that note, make sure you are operating out of a business account and not a personal bank account. If you don’t do this you’ll find it extremely hard to know what is being spent where what is turning a profit and what is costing you, dear. So get a business account and then make sure you study it daily. You don’t want to be left in the dark about anything. Of course, there are bits of software you could use, free software like Mint, which is designed to track spending and analyze the rate at which you are going through your cash. If this isn’t the one for you, though, http://www.lifehacker.co.uk has a list of great money management and budgeting tools. These can be a big help.