Reality of Bootstrapping

sasha uritsky

Aug 17, 2015

Going after investors? Do you know that less than 1 percent of startups actually raise VC (or angel) capital, which means that the vast majority are self-funded. Yet the main reason for it simply lies in the inability of most companies to find investors.

Bootstrapping, however, has several strategic advantages for your company's future growth. Perhaps the biggest is retaining the majority of shares and control over the strategy and direction your company is moving towards.

It also teaches financial discipline. Bootstrapping at the start helps to understand the importance of revenue and cash flow, as opposed to unabridged product development, and keeps you connected to your company's financial reality. Only when profitability increase do you then green-light new opportunities, increased risk-taking, and growth acceleration.

In reality, the founders are expected to be flexible. While entrepreneurs have certain intentions and philosophies when they are starting out, a hallmark trait for successful founders is the ability to adapt to changing environments and opportunities.

Sometimes, that means waiting a long time to generate the financial metrics that really matter, revenue and profit. By challenging your leadership team to focus on building the business organically and figuring out how to make the company consistently profitable on a model that can scale without VC capital, you make your company more valuable to future investors.

Interested in reading more? Check out our other blogs:

Lessons for Businesses from Brazil’s World Cup Disaster

1. Mental, or psychological, state of your team is important: you can put so much pressure on people before they crack. Brazil players didn’t become unqualified professionals overnight. They failed because they were overwhelmed by their country’s expectations, distorted sense of history, and the right to win considered divine. They were too emotionally charged, not in the proper state of mind to compete. So better keep calm, relaxed atmosphere in your team even before launch, or important deadline.

2. Manage customer expectations. Brazil were ramping them up unreasonably. Aggressive messages like the 6^th[title] is coming, statements by their coach about two more steps to heaven massively backfired by creating an unhealthy emotional frenzy in the society, which in return influenced the players (see 1.)

3. Logic, organization is the key to successful execution. Germany are not a great team. But they are very well organized. They had a detailed game-plan where every team member knew his task and several different scenarios where prepared. They were able to adjust when the situation on the field changed to squeeze maximum advantage. Sounds simple? That’s because it is.

Easy Yet Untapped Revenue Channel for Hotels Worldwide

There are many travelers looking for hotels and places to stay on social web. Every day.

Take Twitter, for example:

Or this:

People are genuinely looking for help. Surprisingly though only few are getting it. According to nmodes data less than 12% of Twitter travel requests are being answered. The rest - lost opportunities for hotels and businesses in the hospitality industry.

And how big is this opportunity anyway?

nmodes Twitter data shows that every 15 min somebody expresses intent of going to, or visiting New York. Most of these travelers need a place to stay there.

Every 33 min - intent of traveling to London.

Every 54 min - intent of traveling to Paris.

We started Twitter recommendation service @nmodesHelps and were encouranged by the results. 72% of those that received our travel recommendations reacted by thanking us and expressing their gratitude. This reinforced our assumption that people seek travel advice on Twitter, accept it as an instant value, and are prepared to act upon it.

The hotels that are ready to move fast to monetize this opportunity will benefit the most.