What does Bootstrapping mean?

In terms of a business, Bootstrapping your business is the method of funding or starting a business without any external finance or borrowing. It relies on the skills, wits and determination of the business owner.

As an IT professional, bootstrapping has different technical meanings, but that’s not what this article is about and would be pretty uninteresting to most..

So, what does bootstrapping do for the aspiring businessman or entrepreneur?

Basically, its starting up a business with as little available funds as you can afford. By available its what money you have in your pocket and tools or skills you already possess. Its what you can spare to get going without over-stretching yourself or leaving you in debt before you even start your business.

This is an attractive way to get a business going. You can run it along side your normal day to day work until it generates enough to support you. You can use it to experiment or test the waters with out risking losing everything. You can grow a business and be in control the entire time, not having to worry about load repayments or the agendas of investors.

When you look at it, bootstrapping is just a business buzzword to describe something that has been around forever. Its the old way of doing business, you work, you earn, you grow, you live!

Just look at the important business people of today, Sir Richard Branson started his Student magazine from nothing, Sir Alan Sugar sold his aerials from the back of a car and Duncan Bannatyne sold ice creams!

What benefits does starting a business with little money have?

One reason would be you can start quicker, this follows the Just Do It mentality that I like to follow. It also means you have less to lose so reduces risk exposure.

There is another very important aspect, it drives you on, gives you motivation. Starting with very little and seeing something grow based on your hard work is immensely satisfying.

After all never gamble more than you afford to lose! But then your business idea is going to be a winner, so whats the gamble …

 

Does bootstrapping work for all businesses?

Its great for those that offer a service where you make money on your own skills. Its not so great for making the next smartphone! Generally business ideas that need expensive things to make stuff wont work so well! Unless of course you have a handy manufacturing facility hidden in the garage.

That’s not to say all businesses that make things cant be bootstrapped, craft businesses can start as a hobby and grow to a business. Its a matter of perspective,

 

Ok I am sold, how do I bootstrap my business? That will come in the next article!…