Bootstrapping is entrepreneurship in its purest form. It is the transformation of human capital into financial capital. The overwhelming majority of entrepreneurial companies are financed through this “highly creative” process, which involves the use of personal savings, credit card debt, loans from friends and family, and formal sources of private equity.
1. What's your business model, and how will it make money?
Before launching your business model, really think about if you can receive payment before the delivery of your product or service. This can ensure that there is constant cash flow to keep your business afloat. This is typically seen with businesses that sell on pre-orders, such as t-shirt companies. Other business models require either a deposit or full payment prior to rendering services. Either option is a great way to go if you are launching on a shoe string budget. Here are some perfect examples!
2.Conduct enormous amounts of research:
At this point, research is your best friend. Be sure you have all the information needed to launch your business. This ranges from your initial business idea, to your business model, as well as possible competitors. Look at it this way, you can never know too much information pertaining to your business. Always capitalize on possible suppliers and customers through your ability to network.
3. Be sure your service is worthy of media attention.
Putting your product or service out there is much needed for any type of industry. As an entrepreneur you need to make sure your company is relevant and visible. People need to know what you do and how you do it. This will in return ensure that your company is getting steady recognition as well as generating steady income.
4. It’s important to keep the option to barter open
This is a technique that has been used for centuries. Sometimes you just don’t have the money in hand to pay for professional services for your business. Who says you can’t use what your company offers as a form of payment for your business needs? When you think of bootstrapping this method is all too familiar. When seeking out a service for your business, try to find ways to make what you provide desirable. For example, a t-shirt company may offer a specially designed shirt for a company’s’ employees and use that to garner something in return. It’s done all the time!
5. Don’t be afraid to do the work that is needed yourself.
We are definitely in the Do-It-Yourself era. When it comes to home improvement projects, lawn maintenance, and arts and crafts projects many people are feeling the Do-It-Yourself buzz. This is a sure fire way to save on cost. As an entrepreneur launching a business, you’ll wear several hats that require you to be customer support, management, a secretary, and in many cases the janitor.
Many people think of bootstrapping as a means to an end when other choices do not exist. Even though research indicates that bootstrapping is a risky way of starting a business, there is a vast number of start-up businesses utilizing this technique. The survival of a bootstrapping entrepreneur depends on his or her ability to be highly adaptable and operate on a shoe string budget. Following these simple steps can result in your successful venture towards bootstrapping your business.