Four Entrepreneurs Share Their Secrets

Bootstrapping your business means relying on your savings and income to launch operate and grow your startup, with no help from external investors. It can be financially challenging, but also incredibly empowering, and for many bootstrappers, it’s a startup funding option of choice.

Sharpening your business skills

Euan Davies launched sliderfy, which sells branded sliders to businesses and sports clubs, with his business partner in 2019. The startup costs were just £300, which included company incorporation, website development and hosting, marketing, and product testing.

The pair bootstrapped by choice, as they had the marketing skills they needed to launch the business and avoided having to pay for website development and digital marketing support, but Davies believes that bootstrapping can make you a better business leader.

“It forces you to make better, calculated decisions, while shoestring budgets also encourage more sensible advertisement spending and marketing,” he says.

Some of the biggest bootstrapping challenges are around cash flow and growing the team. “Hiring hire full-time, quality staff is hard when you don’t have the funds to offer competitive salaries,” he says. “Bootstrapping a business full-time, without another income to support you is also difficult when you face the dilemma of whether or not you get paid each month.”

However, the business turned over £350,000 in 2021, and having successfully launched in France and Australia, is on track to exceed £500,000 in revenue in 2022, with a team of five full-time staff and no external investment.

Top tips:

  • Make sure the business you’re launching is either solving a problem or providing something unique.
  • Be solutions-focused. No matter how organized you are and how well you’ve planned, you’ll run into many problems that you’d never considered pre-launch.
  • Don’t do it alone. Having a business partner or cofounder helps to share the load, especially when you’re bootstrapping.

Turning a passion for trivia into a product

Water Cooler Triviaa platform that allows users to create a group by inviting colleagues and asking them to answer quizzes, was launched in 2017 by Collin Waldoch, Ryan Allen, and Nick Jones.

“We very purposefully bootstrapped it as it was a side project and we all had full-time jobs,” Waldoch says. “We continued to work on it part-time for the rest of 2017 as a free product. In early 2018, we turned on pricing for the first time and made our first sale.”

Startup costs for the first six months without revenue were between $2,000 and $3,000 and mainly included the technology costs.

“We were writing all the content trivia questions ourselves at this point but not paying ourselves any wages, or doing any paid advertising,” says Waldoch. “But bootstrapping also meant we weren’t beholden to any investors; during times when we weren’ t putting much time into the business, and in those months we didn’t feel guilty about moving slowly.”

In March 2020 Waldoch left his full-time job to commit to Water Cooler Trivia full-time for at least one year. The company’s annual recurring revenue currently exceeds $300,000.

Top tips:

  • Work on something exciting, something you’d rather spend two hours working on at 10pm than going to bed.
  • Split the equity among cofounders in a fair way. It’s not worth the stress later on if things are skewed.
  • Don’t spend more on any given customer, in terms of time or specific asks, than they are paying you in revenue.

Staying in control

Research technology (restech) entrepreneur Lewis Reeves and his business partner Patrick Fraser bootstrapped their business Wall in October 2020. It was bootstrapped through choice as the two of them wanted to start lean and understand the post-pandemic market before making significant investments.

Walr aims to make market researchers’ lives easier by giving them a single, digital platform on which to create their research using surveys, display the findings and share with others.

“Given the pandemic, we had a few initial costs as we didn’t need to commute every day or travel to see clients across the UK and beyond,” says Reeves. “Initially it was a matter of sacrificing salary to get the ball rolling.”

The personal toll of bootstrapping was the pressure of doing the jobs of multiple people, leading to regular 16 to 20 hour days for both founders. The significant benefit was getting a full understanding of the market, of every function of the business, and also maintaining full control and ownership of the company. Last year they acquired a company through the business profits and currently has a run rate of £8.3 million.

Top tips:

  • Think client first. Find out what the client will say yes to before spending money on building something unproven.
  • Focus on early sales. It’s critical to have revenue coming in if you are bootstrapping.
  • Don’t be deterred by investment news. Organic bootstrapped growth is extremely sustainable; The boom and bust of VC-backed business are very volatile, so don’t allow this to make you feel like a failure.

Nothing to lose

Richard Michie started his digital marketing agency The Marketing Optimist in 2016 having been made redundant.

“Losing my job at 43 was a huge blow,” he says. “I had zero redundancy and zero savings, and my wife had just left full time teaching to be a supply teacher. I’d always wanted to work for myself so I grasped the opportunity as I had nothing to lose.

Armed with just an old laptop and a mobile phone, Michie launched his agency with a post on Facebook and landed his first client on day one. The biggest challenge of bootstrapping alone, he says, was the time, and in his case, the huge pressure of needing it to work, but the biggest benefit is having no constraints other than your time and guile.

Michie, who has continued to grow the business organically and now has a team of three, says: “Bootstrappers think on their feet and can make more impact with their passion and drive than some businesses can with larger teams and a budget. The biggest benefit is being in charge of your destiny.”

Top tips:

  • Don’t be paralyzed by fear. There’s no correct way to bootstrap a business, go with your instinct and ignore the naysayers.
  • Connect with a community. I joined Entrepreneurial Spark in Leeds, which was a cohort of other bootstrapping startups, and the supportive atmosphere drove me forward.
  • be fast. When you’re on your own you don’t have time to hang around, so take action quickly, done is better than perfect every time.

.

Leave a Comment