Most small business started with limited amount of working capital or cash injection from angel investors or traditional lenders. The funding numbers are mind boggling as angel investors fund only 0.91% percent of startups and traditional lenders at 2%. As a startup business owner, you need to carefully dwell upon these figures with respect to the roughly 50,000 new small businesses started every month.
The odd of getting capital for business is very low, and if you are genuinely motivated to start a business you need to bootstrap your way to the top. Though it isn’t going to be easy, but can be worthwhile personally and financially, because you keep hold of your equity. There are best bootstrap tips that can get your small business to the top.
- Explore Competition and Market Trends
Before making a decision to do something, ensure you have an effective business prospect. You need to make a fully research of your competition and market trends and scrutinize whether your proposed products/services already available and at what price. How can your target audience make a distinction between you and your competitors? Does your product/service make you a better alternative? What’s your USPs and costs? You need to have answers of all these questions before even stepping into the market.
At Merchant Advisors, we have helped thousands of businesses with their business financing needs and know of several successful businesses that sold their products even before they had it developed. All those startup businesses did this to be absolutely confident that there was a target market for it. This isn’t the conservative approach but an example of how business owners had taken extreme measures to be 100$% sure they all win before starting.
- Make a Revenue Generated Business Model
While bootstrapping, make sure your cash flow is constant and you have revenue generated business model. Because if don’t have one, you will be stalled as your reserves blow. Having a steady cash flow is a must thing for smooth business operations. Many successful bootstrapped businesses follow revenue generated business models to support instant cash flow needs and smooth business running.
- Crank on Your PR From The Start
As bootstrap startups, you can greatly benefit from media exposure initially. Media personnel and Journalists and are much more interested to talk to the actual founder – they aren’t interested in a PR representative. They all want to hear your actual startup story, your efforts, and your missions than a PR firm. It’s time to roll up your sleeves and get cracking on your public relations from the start.
- Help Creating Buzz from Customers
People love new technologies and they are more prone to show it to the world. So, following in the same footsteps, every startup should provide ways to customers to help promote your startup socially. By attracting to people’s vanity, create brand engagement among customers. You can do this by offering special offers or sales discount coupons and ask them to share your website on social media channels with a branded hashtag and than randomly select the winners. You can also promote your products with customers using your product with a hashtag on the social pages.
- Grow Your Presence Digitally
Another best way for a startup to succeed is by having a professional website detailing all the products and services with engaging content. With a shoestring budget, you can have a website with a pre-made theme and then use the most of your cash for digital and marketing campaigns. Use a creative approach for brand exposure rather spending all your money on ads or usual marketing campaigns.
- Keep Track Of Your Spending
Cash is the key to business success so make sure you keep track of every penny spent. Money goes out quickly when you run a business and sloppy management of accounts can give rise to rude awakening. Use of professional accounting software like QuickBooks can help keep track of your spending and weigh burn rate. Scrutinizing daily cash spending can help maintain the business cash flow and support growth. You also have to cut unnecessary and sumptuous expenses. Review your past financial statement to uncover the areas where you need to cut short spending.
- Do All The Initial Work Yourself
To balance and cut short the expenses of your startup, it’s better to do all the initial work yourself. There are jobs that you can’t that require specific technical knowledge so outsource them – but those you can just don’t feel like doing you are making a needless expense.
- Never Back Down & Stay Determined
While bootstrapping a startup, there will be many challenges and hindrances to beat. Building trust for a startup can be an early test and suppliers or vendors are reluctant to work with new businesses. So, the key is to stay persistence and don’t take rejection personally – it’s going to happen.
Bootstrapping a startup isn’t an easy job. Frankly, it’s very challenging — but if you can believe that the success is just around the corner.