Bootstrapping your college startup
A lot of people have been conditioned to think that they need a substantial amount of money to start a business. One of the most popular ways to get this is to secure a loan, which can either come from your parents, a bank, or other institutions. I’ve always been wary of using other people’s money and falling into a huge debt way before even getting Customer #1. Fortunately, there are other ways of doing things, and there’s one that I particularly like called “bootstrapping”.
Greg Gianforte, CEO of RightNow Technologies, defines it as “the act of starting a business with little or no external funding. Bootstrappers don’t write lengthy business plans, chase deep-pocketed investors, or indulge in overly academic market research exercises. Instead, they focus all of their considerable energy, brainpower, determination and skills on creating a business that can actually succeed in the real world.”
How do you bootstrap a business? There some rules that can guide you:
Be resourceful. Look around you. Make list of all the things you have that can help you jumpstart your business. It could be your computer, it could be your roommate’s expertise at web design, it could be your dad’s tools that you can borrow, or it could be some of your old books that you can sell to reduce clutter. Start small and maximize your resources. Use credit only as a last resort.
Penny pinching is a virtue. Account for every dollar you make. Avoid spending your profits on nonessential items. As much as possible, reinvest it in your business so it can grow organically. Your lifestyle should be austere. When your business gets bigger, you will be able to reap the rewards of what you sowed.
Focus on sales. Since you’ll start with little capital, it may run out quickly. Once you start your business, plan on how to sell your products or services as fast as possible to maintain your liquidity.
Look professional. You may be operating a one-man business from your dorm room, but your customers don’t have to know that. If you have a website, make sure it looks good so your clients will have a nice impression of you. Talk to them in a mature, professional way to earn their trust and loyalty.
The lack of funds really doesn’t make a good excuse anymore. Stop daydreaming and try bootstrapping. Who knows? Maybe you can start your dream business today.
Related Articles:
- 3 Useful resources for bootstrappers
- Reminded of the need for perseverence
- Five Effective Ways To Re-Invest Your Profits
- 5 Tips for College Entrepreneurs: Let Your Business Purchases Earn Their Keep
- All about venture capital camps
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