My Friend Ami Kassar (formerly with ideablob, which died when Advanta went bankrupt) offers a great bootstrapping story. Fresh off his pink slip from Advanta, Ami used bootstrapping to navigate his way through using the market to help refine and develop his new business model behind his venture MultiFunding.
From the Philadelphia Daily News:
To start up quickly and cheaply, MultiFunding used WordPress as its blogging
platform (“so we can evolve it,” Kassar explains). He and his partner printed a
scant 100 business cards apiece, he says – then scrapped them and reprinted a
micro-batch when they realized that their corporate tagline was off-message.“We found our office as a sublease on Craigslist,” he says. “We moved in and
the phones were here and the Internet was here, and we got going.”Baby steps for newborn companies: “I think you have to start with your idea,
then break your idea into steps,” Kassar says.Step one, he says, is to “sort out what the fundamental economic proposition
of your idea is and what it would take to prove it….”“Then find a way to execute it as inexpensively as you can. Then, in
two-month or three-month increments, you can say, ‘OK, I’ve learned this or
proved this. What is the next step?’
Ami offers great lessons for any start-up.
Amen!
A business is about generating revenue, and not about fancy Herman Miller chairs or awesome business cards.
Make money first. Prove the concept. And then suddenly everyone will want to loan you money, when you don’t necessarily need it anymore. And it feels so good to turn them away at that point!
Good luck Ami. I’m rooting for you. Bootstrappers rule.
I agree that Ami offers some great bootstrapping ideas for start-ups. Sometimes the best ways to cut costs in the business are the most creative ideas. If the product or service is correctly positioned in the right target market, social forums, such as blogs allow entrepreneurs unique ways to reach the customers in a cost effective manner.
Also as you mentioned in one of our recent class discussions, rent is one of highest single costs in a business. That overhead affects the breakeven point. It is very important for the entrepreneur to know that the lower the fixed costs are, the less you have to sell to make a profit. That is why is it smart to save when purchasing rental space.
Lindsay McIlvain, MACC student
I agree that Ami offers some great bootstrapping ideas for start-ups. Sometimes the best ways to cut costs in the business are the most creative ideas. If the product or service is correctly positioned in the right target market, social forums, such as blogs allow entrepreneurs unique ways to reach the customers in a cost effective manner.
Also as you mentioned in one of our recent class discussions, rent is one of highest single costs in a business. That overhead affects the breakeven point. It is very important for the entrepreneur to know that the lower the fixed costs are, the less you have to sell to make a profit. That is why is it smart to save when purchasing rental space.
Lindsay McIlvain, MACC student
This is a great example of someone who started a business with very limited means. They were able to be prudent with the limited means and remain effective and efficient by not adding overhead that wasn’t needed.