Ways To Bootstrap Your Business
I was reading through the YE Forums today and noticed a thread on bootstrapping so I thought I would share a list of top ways to bootstrap your business. For those of you who are not familiar with the term, bootstrapping is the process of spending as little money as possible to get your business off the ground. It is equivalent to starting a business on a shoe-string or limited budget.
Ways To Bootstrap Your Business (in no particular order)
- Work from home to save on rent, commuting costs, and you can deduct some of your home costs for tax purposes.
- Get customers to pay upfront by selling membership, subscriptions, gift certificates, coupon books and other initiatives to get their money now and deliver later.
- Lease or rent equipment and other major purchases instead of buying. Always try to push off payment to the future.
- Get used instead of new equipment to save on the expensive price tags.
- Barter your products / services in exchange for something you really need.
- Get free publicity by contacting reporters with a story idea instead of buying expensive advertising.
- Do a side job to make sure you have an income that lets your business survive in the early days.
- Give sweat equity to employees / partners instead of paying a salary.
- Take as little as you can out of the business and focus on growing the company so you can bring in more cash in the future.
- Manage your cash flow and make sure there is more coming in than going out before you start spending money
Evan Carmichael
Evan CarmichaelYoungEntrepreneur.com Blog Manager
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7 Comments so far
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Great advice, indeed - wish I had had some of that when I started my first company. I made all of the usual mistakes (such as spending on logo-ed apparel….why?).
Had I asked myself, “How will this make me money?”, I think I could have done much better.
#1 and #9 were extremely important when I had started up my first business. Great list!
I think your advice makes sense. I have been reading up on Bootstrapping. Sramana Mitra in her piece, http://sramanamitra.com/blog/655 Is Bootstrapping Becoming Sexy Again? has explored the phenomenon that today, companies can be built quickly bootstrapping and bring success. Entrepreneurs are perfectly happy bootstrapping their companies.
This is great advice. The first year of my business most of my income and new customers came in from word of mouth. Basically I had a mini partner program where if someone referred X amount of dollars they received X amount of free product. Opposed to my banner and PPC campaign, which didn’t yield satisfactory results.
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