Join Rudolph Rosenberg for an in-depth discussion in this video Linearizing your expenditures, part of Entrepreneurship: Bootstrapping Your Business.
- The principle behind the concept…of linearizing your expenditures is simple.…The later you pay for something…and the better you're off since you'll have the time…to make money to pay for it,…and will therefore not need investment money to fund it.…So for example, if there is something…you need from Day 1, like inventory,…ask yourself what portion of that inventory…you really need now, and what portion of it…you produce for other reasons than immediate need.…
For example, you might need only 50 units…of a certain product you sell,…but you know that by producing 200 right away…you'll get a much better price, and therefore,…save money in the long run.…In total, you'll have spent much more money,…but per product, you indeed probably saved money.…Well when bootstrapping your business, you should be…more interested by the total money you spend today.…First of all, the bill will be smaller.…
Even if it will not be the best price you could get…for 50 units of your product, it has other benefits.…For example, by producing only a small batch…
He shows why beginning with the end is important: framing the venture by anticipating your exit strategy. He explores key resource-planning factors as well as the competencies and considerations required to fund and grow a bootstrapped business. The course then details how to manage the startup and evaluate it realistically to determine whether to stay the course or pull the plug. Finally, viewers will learn how to validate the business-plan assumptions effectively to determine viability and growth trajectory.
- Summarize the five pillars of bootstrapping.
- Determine which type of office space would be most beneficial for a given business.
- Explain the concept of linearizing expenditures.
- Identify the reason why making sales quickly is important to bootstrapping.
- Recall strategies for attracting new customers.
- Recognize the advantages of working in short cycles.
- Explain the importance of having a work-life balance.