> Your employees adopt your bootstrapped mentality and they, too, are careful of where they spend your money and try to be as resourceful as they can with limited resources
and
> Could I go and raise a few million bucks in a seed/series A round today? As a second-time founder, yes — I’ve said no to several investors already and have a strong network.
The biggest expense in almost any startup is employee salaries, so raising money almost certainly means higher salaries for employees. So you are basically saying: "I'm rich and have connections, but it is better for the business if we all are very lean". While it is true that being lean is probably better for the business, it only works if the employees buy into it. Maybe you are giving employees tons of equity and that causes them to buy in, but otherwise the whole thing seems pretty hollow.
VCs are very optimized for "go big or go home." It's nice to not have that pressure early on, for the founders and the other employees.
It's interesting how different the feel is at different companies -- VC-backed vs private-equity-backed vs public. Bootstrapped is potentially a different feel, and a better match for some people.
Does it work out that way in practice? No clue. Never worked for one of these, though I've worked for VC-backed, private-backed and public.
There is a certain scrappiness that comes with being a bootstrapped startup. Your ad budget is $0 and you have to come up with creative ways to generate buzz. The struggles end up forming a foundation and culture for a much stronger company in the long run.
So he isn't raising capital so he can penny pinch his employees. He's not raising capital so his employees can be a part of a business that will be around in 3 years.
> but otherwise the whole thing seems pretty hollow
uh, what? why? how did you come to this conclusion? you're wrong. not only are you wrong, you are also assuming he's being cheap to his employees. you just made up this fact in your mind, and assume it to be true. quite frankly, that's you projecting.
we're bootstrapped and we pay people higher salaries to incentivize them to work for a smaller, "unstable" company. if we raised money tomorrow nobody's salary would change. my salary as a founder probably wouldn't change. i'm pretty sure that anything beyond a nice dinner to cap the occasion, i.e. just paying ourselves more because some new money showed up, would be frowned upon pretty heavily by anyone investing money.
and i am aware of several name-brand funded companies that pay people less than market just for the privilege of having their company on a resume.
bootstrapping doesn't mean "be a cheapskate and pay everyone under market" it means "earning and using revenues to grow the company at the early stages and possibly beyond". you can bootstrap and pay people above market salaries, or pay yourself a wildly inflated salary if you are the owner.
you have a fundamental misunderstanding of how modern small businesses work, probably because you have never run one.
In theory, everybody bootstraps until they get funding, don't they?
On the East coast, I've heard of many small businesses that self-funded (savings and/or spouse) to get started, and never took any funding. Never heard of even one incident of a small business that was invested in. Obviously it's a different world in Silicon Valley, but if we look at the nation or globe, what is more common?
I agree that bootstrapping is easier for people with capital. But hopefully nobody is starting a company without at least some money in the bank. That means that everybody starting out should be asking, "Is there some way we can get to revenue with what we have?" Mentoring at events, I've seen companies get revenue literally in the first weekend of their existence, so it's not impossible even on very modest budgets.
Even if the answer is "no", I think that strongly considering it helps people build better businesses. There's a terrible tendency for people to delay contact with the market until they're "ready", but nobody is ever ready for that, not the first time.
I almost want to invent another category for bootstrapped startups that have access to large amounts of personal liquid assets.
Just think of the difference in strategic moves available to you if you have $1MM vs $10k to throw at a problem.
Having said that, I applaud his efforts to try things differently, and even agree with a lot of what is in there.
If you have $10MM you are self-funded, not bootstrapped (sure, an initial self funding is always necessary, but it is easy to differentiate 10k and is 10MM).
Whatevah.
If the initial investment was $10k, then yes, it is impressive. I have an inkling that it's nowhere near that low, though.
Not to mention how silly it is to say he's "bootstrapping" when he's sitting on millions of dollars. In most cases you'd be an idiot to not boot strap in that case.
I have a client that uses Woocommerce, and to be honest it has a huge support requirement, because WordPress and all the plugins updates/security problems.
Can anyone recommend any competing services to Bigcommerce which I should review?
Bootstraping is using your own personal assets to pull up your business yes?
