Bootstrapping – Boon or Bane for Product Startups?

On August 14th, 2014 iSPIRT, the industry enabler that is creating a vibrant eco-system for promoting, encouraging, supporting and enabling product companies out of India, organised a very useful online discussion on the concept of bootstrapping. Titled  ‘Bootstrapping – Boon or Bane’, the discussion explored various facets of bootstrapping, including its relevance, benefits, limitations, and challenges.

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Sharad Sharma, founder of iSPIRT kicked off the conversation with a very incisive observation that the startup community, largely driven by the media, tends to celebrate and showcase startups only when they receive angel or institutional funding. How true is that!!! There are a number of very successful and modestly successful startups, many of who are deserving of the praise and showcase, but they get reported about only when they close an investment round. (I am not sure if the media is to blame entirely. I suspect companies too reach out to media only after they have received an investment round, perhaps because they believe that funding makes the ‘story saleable’ for the media.).

Continue reading “Bootstrapping – Boon or Bane for Product Startups?”

Bootstrap whenever you can

It is possible to boot strap quite a few concepts into venture. 

However, the perception these days is that if you have to be an entrepreneur, the first option should be to raise funds. (This perception has a lot to do with Business Plan Competitions in B-schools and engineering colleges where VCs are invited as judges).

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My view is that raising external funding should be the last option. If possible, and it is possible in many cases, try to bootstrap a venture.

Bootstrapping necessarily means that you would be frugal. When you are low on cash, you innovate and become more creative in all things – in hiring, in developing the product, in marketing, everything… And you try hard to get to revenues faster. All these are fundamentally good for a business