There are many roads that can lead to major milestones of a startup. Most will point to an MVP and Traction as the two most important ones in a pre-seed and seed stage startup. How do you get there?
Bootstrapping (achieving something through the use of only existing resources) is the most effective model to not only build a business, but to also dispel risk in the eyes of your future investors. By bootstrapping, you are essentially maximizing all of your resources first and strategically putting your startup in a position of power. You maintain ownership, show future investors that that you are capable of operating and managing low-burn rates, and demonstrate that you have the necessary resources to sustain. These factors play into a VC’s risk management scenario. Walking in the door as bootstrapped startup, with MVP and/or traction in hand will most likely improve your position and increase your leverage as you negotiate your term-sheets.
Bootstrapping starts from day one. Pick your co-founders wisely. Make sure that your skills are complimentary and there is minimal overlap. In the ideal scenario, every task is executed internally, and minimal expenses are incurred.
Revenue becomes your focal point. If you are working with your own money, then you will be more focused on making money. Your MVP will stay lean in order to get proof of concept, and your traction becomes a priority. Walking in the door to raise funds with a clear source of revenue, on top of your MVP and/or traction, will further separate you from other startups.
UI/UX becomes a product of our users. Unless you have an expert on your team, bootstrapping your startup will force you to listen to your users from the onset. They will shape the UX and allow you to tweak the UI fast. In the end it will not only be an MVP, but a user-tested and approved MVP.
Time is your best friend. If you bootstrap, you will be dictating your own timelines and milestones. You'll experience organic growth and allow the business to mature without outside pressures. In the end, this could be the reason why you achieve sustainability.
Listen. Listen. Listen. Learning doesn’t always have to be about making mistakes. You can learn from other people’s mistakes. When bootstrapping, the level of error is smaller since you have to focus on efficiency. Listing to other startup owner experiences, reading case studies, or attending workshops you can learn a lot about moving your company toward your next milestone.