Waiting for cash will get you nowhere. First things first, get bootstrapping
By Pat Romain (Founder, Vizion V.A.)
Like many new entrepreneurs, when I first started my business, operating finances were constantly on my mind.
“You need to have money, to make money” was the mantra that I played over in my head and it set me down a path that slowed down my business growth.
Instead of actually working on my business, I spent most of my time trying to finance it. I spent hours of time researching every business grant and loan under the sun. I attended training events to learn how to create award winning scholarship applications and I even thought about hitting up my wealthy friends to pitch my case to invest in my future enterprise.
I had no idea that I was running in circles until a friend tapped me on the shoulder and gave me a reality check. Her advice? Instead of trying to follow the money, spend more time trying to find clients and validate whether my business model would work instead.
Even though finances are an important part of business, starting lean, validating your business model and business idea should be your number one priority.
Before you go gung ho about looking for investors to fund your empire, remember that the number one reason that you started your business is to provide your service or product to the world.
Ideas look great on paper, but you have to ensure that your business model actually works, and there is no such thing as ‘free’ money. There is always a cost. Start by getting the advice of a seasoned business mentor to keep yourself accountable and on track to turning a profit. Spend time validating your assumptions of the market before you invest a lot of time and money into your product or service.
So how can you ensure that your business gets off to a great start without having to rely on the chase for funds? Here are 4 reasons why “bootstrapping” your business is the way to go:
You Can Spend the Money Exactly How You Want to Spend It
When you have VCs and other investors who have a stake in your business, sometimes what they say goes. When you are the owner and you have invested your own money into your project, chances are, you decide where to invest and how this money is going to be used. Having a lot of money tends to mean that you can spend a lot of money. Although that may seem great, it can be risky. When you have a limited amount of funds, you invest in exactly what you know will make your business grow.
You Can Spend Your Time Where It’s Needed
You can spend your time being the CEO of your business and not just running after new funding or writing grant proposals. As the founder and owner of the business, your time is the most important resource that you have. You can choose to spend it growing your customer base and attending to revenue generating activities.
You Don’t Have to Worry About Repaying Loans
No explanation needed!
You Learn the Most Cost Effective Ways to Do Things
You learn to use the cash you have on hand for the biggest and best impact. When bootstrapping, you always know what your numbers are, what you can spend, what’s coming in, and how. You also push to launch your programs, products and services to fill the income gaps (when they come up) instead of relying on other sources. You’re also forced to get your products right the first time by being close to your customers and listening to what they want. Bootstrapping really does pay off.
How have you economized when it comes to running your business?
About the blogger: Pat Romain earned her Bachelor’s in Business Administration from Antillean Adventist University, banked a decade of experience in the corporate world and, in 2009, she founded Vizion V.A. Pat is a dedicated and marketing maven whose passion is helping companies generate more revenue and succeed in their digital initiatives.