Basics of Business Bootstrapping

What is Bootstrapping in Business?

A number of young professionals, home-makers and even hardened executives in India are increasingly taking the leap to be their own boss. Have a business idea, have some money saved in the bank – why not bootstrap and embark on the entrepreneurial path? Investopedia defines business bootstrapping as the “situation in which an entrepreneur starts a company with little capital. An individual is said to be boot strapping when he or she attempts to found and build a company from personal finances or from the operating revenues of the new company”.

Bootstrapping, therefore, essentially means to use your own savings in order to take-off your business idea. This is all too common in the start-up world as it is often difficult to get funds from venture capitalists or even loans from banks at the ‘starting-up’ stage. Also, you may want to test your idea, see if it has the potential to take-off and assess the timeline within which the business can start making money. Hence, you may want to call the shots at this stage and take your own decisions. Bootstrapping is the way to go for you.

What are the Basics of Business Bootstrapping?

Have a Strong Business Plan: Of no use is bootstrapping if you have not thought through your business idea, assessed its viability after tying in possible loop-holes, and drawing up a basic business model replete with the revenue source/expectancy. Hence

• Identify a person from your circle of friends/network who you think can give you impartial views and confide in him/her about your business plan. He may be able to do some straight-talking with you, pin-point the weaknesses in your business plan and help you draw a stronger model. One often turns to family-members for such reviews, but remember, family-members/friends can either get too critical or too supportive thereby not providing you with the real picture.
• Take in a business partner (Here’s how you can choose a good business partner). If you identify a friend/family-member who shares your vision and itch to start-up, get together!! With a good partner, you can build on each other’s strengths and launch your own ‘dream company’.