Bootstrapping your start-up

You do not need investors for starting the dream business of yours. Some businesses are established and built by venture capitalists and some are built by Entrepreneurs like Microsoft and Dell.

Despite the dream of entrepreneurs to meet venture capitalists with deep pockets, the fact remains that 99.9% of the business owners struggle alone and pull them alone through bootstrapping. Bootstrapping is a way of starting up your business that is rewarding both financially and emotionally. No one can provide you a guarantee for success of your business but what you can do is follow some guidelines that will make your business start off smoothly.

Every entrepreneur and business is different from each other in several aspects. A business owner has to withstand and understand the risks. A college graduate might have high tolerance to risk because he does not have anything to lose. However, the equation will be totally different for a 30 year old single parent.

Ian and Shep Murray knew that they could tolerate high risk when they decided to start Vineyard Vines, their necktie company. Both of them barely had started their career when they were bit by the entrepreneurial bug. They had a vision and both of them just went for it. In the early days, Shep racked more than $40,000 in credit card debt. But he knew that someday when they will make millions, it would be an insignificant amount.

Bart Snow, all of 37, was well settled in his career and had very little to lose when he and his wife started Rain Drop Express Inc. Rain Drop Express Inc is a company that offers courier service in Ohio. Both of them had very small house payment and no kids when they started off their business. They knew that if they were going to do it and it had to be done now. The couple decided that the Bart would keep his job until the fledging company can afford to replace some amount of his income. Understanding personal economics upfront makes future finance decisions easier. Personal decisions like how much capital each partner will invest, how much debt they can handle, etc. must be made before taking any steps.

At the early stage, business is like an egg that is yet to hatch and the process of incubation can be very expensive. Conducting research and enquiries about products and services can prove to be very costly and time consuming. Many entrepreneurs control their risk and expenditure by keeping their day job and let the idea percolate during weekends and holidays.

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