Raising a round appears like the only way out for most prospective startups when trying to grow or kickoff a business, but come to think of it, how many of such prospective startups have actually paused for a moment to think of bootstrapping their venture for it to set sail.
For most startups, if it doesn’t begin with seeking funds, the venture won’t leave the ground.
They fight tooth and nail to acquire that fund they believe holds the key to unlocking the pathway for their brand, rather than grow it from the inside out, and their reason for this could be because of one- if not all the following:
- Quick acceleration to seize a bigger market
- Acquiring financial gain as well as other operational resources needed to move forward
- To focus on the interim and increase their cash stability especially if they were banking on credits, or on savings
If you believe in bootstrapping as a startup, especially with the right individuals on your team who share similar kickoff ideology, you stand a great chance of building a successful venture that can make a profit.
The following reasons below can serve as an eye-opener for potential startups who would focus primarily on seeking funds to kick off their business rather than consider bootstrapping it:
You’ll have control of the cash flow
Bootstrapping will compel every startup to perform optimally knowing fully well that the growth of the brand depends strongly on their performance.
Bootstrapped businesses happen to be frugal, knowing pretty well that every dime they put in needs accountability.
As a startup without the security cushion of investors’ to fall back on, the only choice left for you is to place generating income by yourself as a priority.
Keeping culture and values is a lot easier
You can’t pick culture or values from an aisle in a store or a mart, and when you’re controlling your brand, you can decide the way to build it and how you want it to grow. Just as like-minds attract each other, so do boot-strappers.
This particular synergy creates a culture of people with similar passion and patience to run a business they will end up proud of.
They will now be availed that freedom to experiment, express their thoughts without any obligation to someone else.
You’re accountable for your actions
When a startup is bootstrapped, the major focus becomes metrics and milestones rather than focusing on scoring sky-high valuations because it’s only themselves they can hold accountable.
This doesn’t mean that having a high valuation is the worst thing for a startup, but a down round of funding after poor spending choices made with an initial investment round will always end up terrible for the entrepreneur.
You stand a greater chance to increase your leverage for future fundraising
Bootstrapped businesses kick off small and accumulate value at a controllable pace to become successful.
Overtime when it gets around the curve and there’s a need be for discussions with an investor to get financial aid.
The investment by that time would make more sense, and there will be tangible proof that the business model works, the market need exists, and the founding team is the ideal team to take the opportunity forward.
You’re in control for the long-run
Startups that bootstrap don’t only know their business inside out, but know they are capable of sustaining themselves without external cash help.
This leads to taking decisions confidently and also understanding their company’s best interests way more than anyone else.
Featured Image: yourstory
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