As you begin your startup journey, the thought of raising money can be very intimidating. If you are not ready to take a bank loan and crowdfunding doesn’t seem as a great option, it is a good idea to think about bootstrapping.
Bootstrapping has its benefits. You are in full control and don’t depend on outside lenders while you make your first steps. Investors love bootstrapped businesses – it proves the commitment of the entrepreneur and leaves more room for the first investor, who will jump on board.
Bootstrapping your way to success may be a challenging journey, but if you follow these five tips you will get there in no time!
Mind the personal spending
Now that you have all your money put in the business, you need to mind your personal spending. Cut your personal expenses to the minimum even if that means that you have to give up on your favorite Starbucks latte or even on living on your own. Entrepreneurship requires many sacrifices and the sacrifice of the posh life is one of them.
Cut down on business costs
Now that your personal money is the company’s money, you need to educate yourself on how to reduce business costs. It may seem so enticingly to rent an office space so you can create a productive work environment, but can you really afford that? The office space is not the main priority, so wait for the moment when you have paying customers.
Now that every penny matters, you have to put your ego to rest. Start negotiation offers and contracts. Let everybody know that you are bootstrapping so they can give you better quotes; many vendors and suppliers will understand the challenges and may cut you some slack if they see the potential.
Form the dream team
Hiring experts when you can’t offer them any reasonable payment is impossible. Instead of settling for forming “any” team, try to find professionals, who are ready to work for equity. That means that you need to sell them the idea and make them believe in the future of the company. Hire people, who complement each other’s skills and have knowledge in various areas.
Focus on acquiring customers
Without customers, you have no business. Keep your focus on acquiring customers before you even launch. Conduct market research and get to know the best practices of the strongest competitors. This information will help you get a better perspective on what your clients need and want, so you can approach them with an offer they can’t resist.
Once you get the customers, do your best to keep them. Focus on providing outstanding service. Use CRM systems. CRM systems matter, because they allow the businesses to maintain more efficient relationships with their current and potential customers, leading to the improvement of the company’s profitability and ingratiating future business growth. We recommend you these four!
Create some buzz
Bootstrapping a startup is tough. You don’t have much time before the money finishes, so don’t waste it. Now is the time to spread the word about your product/service, so don’t skimp on marketing and PR. Don’t worry if you have no previous marketing or PR experience. It is never too late to learn.
Luckily, there are many cool tools that you can use to help you up your marketing game: for social media, for email marketing, even for PR. If you want to sell well, you should market well. Be persistent in communicating you’re your audience and grow your network one step at a time.