Join Rudolph Rosenberg for an in-depth discussion in this video The five pillars of bootstrapping, part of Entrepreneurship: Bootstrapping Your Business.
- There are five concrete things that an entrepreneur should focus on when bootstrapping a business. Four of those pillars are focused on reducing, as much as possible, the financial burden of starting a company and operating it during its infancy. The last one is about the impact that bootstrapping can have on the life of an entrepreneur, but more importantly, on how to manage it. The first pillar we'll be looking at is managing spending.
We will be looking at the most significant costs of starting a business and how to keep them under control. It's about how you influence the negative side of your financial equation, the money going out. The second pillar is about customer acquisition and customer retention, which is ultimately about making money, generating revenue and influencing the positive side of the equation. The third pillar is about business management and what mechanism you have in place to determine if you are on the right track or not, and if not, what needs to be done to get back on track.
This one is part of our five pillars because spending too much time making decisions or potentially going in the wrong direction is a massive waste of money and is usually one of the biggest, if not the biggest, startup killer. The fourth pillar is about competency acquisition. A big part of starting a company is about having the right competencies available. Since competencies means people, it usually also means big money to hire people, money that many startups don't have.
So we look into ways that enable entrepreneurs to acquire the competencies they need through different forms of compensation models which ultimately reduce significantly, if not completely, the bill. And the last pillar is about work-life balance. In the early life of a company and more so of a bootstrap company, the line separating work and personal life will be blurred, at best. Because you'll be working a lot, sometimes from home, you might not be able anymore to make that difference, and that could weigh on your venture.
We'll look at some things you can do to make sure that some boundaries remain. So the five pillars of bootstrapping include managing spending, acquiring and retaining customers, managing business, acquiring competencies, and balancing work and life. We'll take a look at each of these pillars in the rest of this course.
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.