September 25, 2017
Ask any startup founder and they are probably thing about money. At the end of the day, it’s hard to know if an external source of income will provide the edge you need to propel your company forward, or if it’ll simply detract from your success.
According to various experts, at the beginning, you should try to carry out all aspects of your venture, from financing to marketing, independently. This might sound overwhelming, but as an entrepreneur, you’ll be surprised by how quickly you can learn to wear multiple hats successfully.
Bootstrapping is a great technique that can help you get your startup off the ground while retaining control of every aspect of its operations. Here are 6 ways to start bootstrapping your company and save money.
Do the Testing Yourself
As soon as you have a concept in mind, you might wonder if you know how to build and test it successfully. You’ll probably be tempted to hire an expert or a company that can build and test your new product for you, but with the right mindset, you can take care of both of these things independently.
If you want to build your own product and cut down on cost, there are maker shops like TechShop with the equipment you need to create a prototype. As you’re creating your prototype, you can also learn about the latest product testing methods online and implement one of these strategies when testing your design.
Keep Expenses Down
Regardless of how much money you start your venture with, you’ll be tempted to scale quickly, whether that means renting an office space or hiring on other employees. Although these pursuits can be helpful, they are often much more trouble than they’re worth. After all, simply making a bad hire can cost you thousands of dollars or more.
Instead of taking on the risks associated with investing in these types of expenses up front, keep it simple. You’ll likely be surprised by how lean you can run your tech startup in its infancy.
Build Off Realistic Expectations
One of the wonderful things about being an entrepreneur is the fact that you have several sources of income, your clients. If one of them decides to stop using your product or service, it’s generally not the end of the world, as you can find new clients. What when you’re just starting out, early adopters can be finicky and unstable. Experts recommend you have least three months of personal expenses and one year of business expenses saved before you launch your venture.
If the earlier mention of testing and marketing your technology was stress-evoking, you might want to consider licensing your technology. Licensing your idea can make you as much, if not more, money, providing that it’s not simply a technique for people that don’t want to build out their concepts.
This type of arrangement will allow also allow you to bootstrap because you’ll be able to keep your costs low while securing future income from other companies.
Do More On Your Own
As I mentioned earlier, one of the major pitfalls tech startup owners make is hiring people too quickly. At the beginning, it’s often nice to have complete freedom and domain over your idea and company, which is why experts recommend that tech startup owners start by bootstrapping alone.
Wearing a lot of hats can be difficult, but it can absolutely be done. Whether you take a coding class to create a rudimentary website or conduct online research to learn about advertising techniques, you have the ability to learn the skills that’ll provide a great starting point for your tech company.
As a small tech startup, one of the challenges you’ll face is getting vendors and suppliers to work with you, which is why you should start building these relationships before you need to work with these two groups. Instead of approaching a vendor or supplier when you need something from them, connect with them before your product is ready for market. Let them know about your future offering, and when you’ve finalized your idea, utilize your personal connection to help them say yes to working with you.
If you want to run a lean startup, try bootstrapping—at least in the beginning. Although it may take more effort than simply applying for a business loan, it’ll provide you with the information you need to position your company for the most success.
Read more tips on bootstrapping your company at TechCo
Did you like this article?
Get more delivered to your inbox just like it!