Funding is one of the first things that come up when I talk with people who are looking to start their own business. We talk about the available options, traditional bank loans, grants, friends & family loans and bootstrapping.
I have bootstrapped my company from the beginning and I believe it is the best idea for most service-based businesses that people are creating. Obviously each situation is different, however below are some of the benefits to bootstrapping.
1. You get to call the shots
First and foremost, when you fund your own business, you do not have to answer to any other stakeholder. You create the business, you identify the priorities and make the decisions and there are no further opinions you are required to consider. Chances are good this was one of the appeals of starting your own business in the first place.
2. Stress is different when you are working with someone else’s money
I don’t know about you, but when I am using someone else’s money I worry about what they think about how I’m spending it. Sometimes they won’t wait for me to worry and just tell me! This is fair if it is their money and they feel you are misusing it. The stress of losing someone else’s money is always a concern and the pressure to return what was borrowed or create a profit on their investment is an additional stress for a young business that can be avoided.
3. You create your own timeline
When you bootstrap your own company it might just take longer than originally anticipated, that’s ok, just make a plan for that. When you are coming up with the money to invest into your company, you may have to wait on some purchases until you can afford the expense. You can set timelines based on the amount of time and money you are willing to invest and there will be no investor to tell you it’s not good or fast enough.
4. You will likely make smaller mistakes
There is a common theme when start-up companies have deep pockets, they are sometimes like teenagers with a credit card. They decide on all sorts of things they ”need” and buy them without determining if it is truly a need. With and investor and a single deposit of capital young companies run the risk…
