It’s no secret that starting a new business can be difficult, especially when you have limited funding and limited resources. In an emerging economy, starting a business is even harder. But during the GIST TechConnect “Bootstrapping Your Business: Tips and Tricks,” a panel of experts explained how entrepreneurs in these economies can benefit from bootstrapping their startups.
Bootstrapping is the process of cost effectively building a business with limited funding while maximizing available resources, like a professional network. Lisa Garcia, business developer for tech entrepreneurs at Virginia Tech University, and Dr. Helder Sebastiao, innovation strategist and lean launch specialist at Target, both said bootstrapping is a strategic decision an entrepreneur makes in order to get closer to a customer base and generate revenue faster. The panel added that entrepreneurs in emerging economies, where resources and finances are already limited, benefit the most from building a business in this way.
“Bootstrapping is about being scrappy. It’s about being tenacious and persevering. And in a culture where you have inherently bread that kind of mindset where you have to persevere, you have to try again and again to accomplish things, you’ve got an incredible resource in the people there and in the environment,” said Garcia. “I think the environment there presents an ideal environment for people to have the right expectations on what it takes to launch a startup.”
“You’re actually perfectly suited for bootstrapping. You’re actually perfectly suited to learn to be creative, to stretch the resources you have. That’s actually an advantage,” added Sebastiao. “Also, if you are a network of bootstrappers … you ought to be networking with other entrepreneurs who are bootstrapping as well and leveraging each other’s assets to help strengthen and build on the resources you have together as a community.”
According to the panel, bootstrapping will likely require investing your own time and money into your startup. You will also have to think of innovative ways to acquire the resources necessary to build your startup’s product or offer your startup’s services. But the panel said if done well, bootstrapping can allow an entrepreneur in an emerging economy to build a lean and successful business.
The panel suggested two steps entrepreneurs should take if they are considering bootstrapping their businesses. First, the panel said Google “Business Model Canvas.” This is a flow chart available through many different websites that will help you better understand the priorities of your startup. Second, if you can, the panel said try reading “Business Model Generation.” This handbook helps founders think about new ways to create a business model – this is particularly helpful for founders who are not using traditional tools to develop their businesses.
The panel discussed several other topics in bootstrapping as well, including the type of investors you should look for and when to lean on your customers for financial support. To watch the full TechConnect on Bootstrapping in both English and Spanish, click here.