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Bootstrapping to success: How to grow your business without VC funding

By Tito Philips, Jnr.
05 August 2016   |   4:16 am
Bootstrapping is a process whereby an entrepreneur starts a self-sustaining business, markets it, and grows the business by using limited resources or money – this is accomplished without the use of venture capital firms ...

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Bootstrapping is a process whereby an entrepreneur starts a self-sustaining business, markets it, and grows the business by using limited resources or money – this is accomplished without the use of venture capital firms or even significant angel investment. Many of the successful companies that we see today – Dell Computers, FaceBook, Apple, Coca Cola, Hewlett-Packard, Microsoft, Oracle, eBay, Cisco, SAP and Virgin, to name a few, had their humble beginnings of bootstrapping to success. But these days, all you need is an idea and you’ve got yourself an excuse to raise money. How come we seem to always want the rain check instead of putting our brains to work first?

Call me old school or even cynical, but here’s one fact that can’t be denied; not every startup or entrepreneur is going to get funding. Yea, that’s reality for you, so suck it up and deal with it!

On this entrepreneurial journey, there’s no guarantee. And nothing can be more dangerous to your morale as an entrepreneur than succumbing to the fantasy of funding. Trust me, I know the drift.
Lying awake all night wondering where the next income is going to come from to cover your expenses is no joke. Or wondering whether you will make it to the end of the month before running out of cash can be damn scary. So yea, the fantasy of funding can be very appealing, especially in such situations. If only you could just get a major investor’s financial backing, all these nightmares and worries will just disappear, right? Absolutely not!

Your problem is MORE THAN Money
Funding is a palliative solution to a more fundamental business problem that most startup, especially these days don’t like to brutally confront. It’s a fundamental business problem if your startup can’t generate some initial revenue to sustain itself till your business idea is fully validated and ready to scale. It’s a fundamental business problem if your startup can’t find a way to successfully launch a minimum viable product to test the market with without seeking for major external funding.

It’s a fundamental business problem if your startup needs major external funding to create her first customer. It’s a fundamental business problem if your startup can’t raise her initial funding internally from your family and friends. It’s a fundamental business problem if your startup needs money to figure out how to make money. It’s a fundamental business problem if your startup can’t find a way to start small. It’s a fundamental business problem if your startup needs money to solve a problem no one is willing to pay for. My point is pretty simple; there are so many fundamentals that are often left out once you allow yourself to succumb to the fantasy of funding. There are just too many business basics that more money won’t necessarily help you solve. And getting caught up in the fantasy of funding will only becloud your thinking. Until you identify these business basics and brutally address them, access to more funding will only amplify your fundamental business problems.

The Mindset for Bootstrapping to success
To succeed as an entrepreneur, you have to understand one fundamental truth about starting, building and growing a business; there’s no guaranteed straight path to success. This means that your business will not manifest itself in the same exact way you dreamt of it or conceived the idea. It is absolutely going to take a very different form than when you first started and you must accept this reality if you will succeed. This is the mindset you need to have for bootstrapping to success. You have to be prepared to think about your business in several different ways and continually work on the most minimal action you can take per time to get you closer to your goal.
Why?

Because all the resources you need to make your business a success won’t come to you at once. They will come in bits and pieces, and your ability to make the most of what you’ve got per time is what bootstrapping to success is all about.

If you would rather focus on having all the money and resources you need to start the way the business was conceived, then you are not going to ever start. But once you accept the reality that venture capital funding is not the only way to grow your business, then it’s easier to open up to other bootstrapping to success strategies available.
To be continued next week.

Tito Philips Jnr is a young Nigerian that is M.A.D – Making A Difference