Want To Double Your Earnings? Try Bootstrapping Your Venture
Bootstrapping is not a new concept in the startup world, but it is surely the latest fad with more and more founders choosing to use their own funds. Entrepreneurs with bootstrapped companies have built a sustainable business enterprise relying purely on their own investment. Such new-age, self-funded startups are aiming and achieving high profits and scalability.
The perception that a bootstrapped startup struggles to break even and turn profitable has been completely shattered by the businessmen. Staying bootstrapped takes a lot of grit, patience, and faith in the product. But if you successfully bootstrapped your company then for sure your startup will turn into another unicorn.
These are the top 5 benefits of bootstrapping that will push entrepreneurs to think twice before raising funds.
1. Total Control
As a startup founder, if you are bootstrapping then you are the whole sole person when it comes to decision making. “The founders and core management of a bootstrapped company can stay true to their original objectives, which is not always possible when a third party investor or outside imposed board of directors have a say in high-level strategy and key business decisions. Worse, there may be a huge disconnect between the objectives and values of the original management, and those of the third-party investors,” said S. Madhusudhan, Chief Farmer, back2basics, an organic farming startup and have farms spread across close to two hundred acres around Bangalore.
2. Think It; Build It
The innovation and decision making can be much faster when compared to investors on board. You can pivot the product, change the idea or build features that you really believe in without worrying about approvals.
“You're free to think during bootstrapping. Innovations can be created every day if you're a bootstrapped company. Its all about think it; build it - No more steps in between,” said Vinay Singhal, Co-founder and CEO, WittyFeed. WittyFeed is a viral content company that provides modern day blogging platform for everyone who loves to express and explore beautiful stories.
Statistically speaking, bootstrapped companies tend to be more customer-oriented than those funded by outside investors. Raising funding, and eventually managing the investors, can be very time-consuming and detract from the orientation of the business.
It follows that another big disadvantage of taking outside funding could be a lack of relevant domain expertise. The outside investor(s) could be making important business decisions, without fully understanding either the model or the category.
4. The focus is on making money
5. Help in boosting confidence
Being bootstrapped and still making a profit while growing in itself is a great boost to confidence.