Bootstrapping for GrowthPosted: June 25, 2011
[this blog appeared in Entrepreneur Country http://www.entrepreneurcountry.net]
I wish I’d kissed him. As I stood up from our meeting and came around the desk, I wanted to say thanks, maybe shake hands. Instead, I watched my exuberant-self move into the personal space of the bank manager and – what the hell was I doing? – stretched my lips towards him. And for a brief moment he started to pucker-up, ready.
We didn’t kiss. One of us, I’m not sure which, blinked – and the fragile emotional bubble just burst. We smiled awkwardly and he left. And the wonderful loan [overdraft, actually] was still on the table.
Still, I wish I’d kissed him. If I’d followed-through in such a dreadfully inappropriate way, he probably would’ve ripped-up the overdraft agreement and stormed out.
And we would have just had to carry-on in the same, capital-constrained way we had been, for a bit longer. Bootstrapped.
Bootstrapping isn’t some Calvinist hair-shirt-and-underpants concept. Nor is it tortured artist starving in a garret. It is about running your business on little or no financial capital, and instead consuming loads of your personal human capital. [sorry, Ariadne – you get a look-in later on].
Most of us, starting a business – don’t have a serious plan to be the market leader. We’re Challengers. And, as eatbigfish [those chroniclers of Challengerdom] say, if you’re not the Market Leader, you have to be the Thought Leader.
And Thought Leadership comes from Resourcefulness, not Resources. Soon as you recognise that your entrepreneurial journey starts with thumbing a few lifts, the greater your chance of discovering some of the unconventional thinking that will confound those Market Leaders.
Too much capital isn’t so much an embarrassment of riches (I’m not embarrassed by richness), as an encumbrance of riches.
Here’s some Stuff That Doesn’t Cost Anything –
Branding by selling
We found all the buyers for our brand’s early (right placement) distribution – while selling at a market stall. I think the buyers even paid for those first samples.
Libraries are full of wisdom. So is the internet. So is Twitter. You can now carry out qualitative market research easily and for free.
Curiosity is heightened in that “there’s nothing else for it, I’m just gonna stand in the aisle / train platform / trade exhibition and watch people” environment. Thought Leadership needs curiosity.
Ideas are hampered by too much money. You start to think there’s only one way. The moneyed way. Except, that’s what THEY are doing.
Of course, there will come a time when capital-for-growth is right.
How do you know when’s right? In my view, you’ll have turned down the offer a few times before you take it up. And then you’ll probably find some ‘cash plus guidance’ option to be a useful intermediate stage.
Even the tech-geeks – once the biggest bubble-blowers – are showing this inclination. Check out models like HackFwd – clear funding, close community of mentors…
…and a shiny buckled-up BootStrapping ethos.