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:

Pros and cons of automation

Automation drives forward the economy. It allows businesses to scale and service large groups of customers. Automation first appeared in traditional industries, such as cotton production in England in 18th century or car conveyors in the US in early 20th century. The automation replaced physical labor.

With the invention of computers automated systems began to replace intellectual labour such as math calculations. Most of the software applications we use today can be described as automation. Online payments processing, online tickets purchasing, tax returns software, computer games, search engines, and endless other programs are all examples of software automation system.

As a next step we are now aiming at automating human decision making processing and high-level intellectual activities, historically considered to be sole domain of humans.

One interesting aspect of automation is lesser quality of service compared to manual service.

This is to be expected. If we gain in quantity we lose in quality.The gain in quantity is what automation is about - it allows to reach out to a large number of customers. Manual product or service can reach out to individuals only. The price we pay for the ability to deliver product or provide service en masse is the drop in quality.

Sometimes automation is an obvious choice. This is when the gain, the scalability, hugely outweighs the costs, lower quality. Search engine is a popular successful example. In other cases, the advantage in not so obvious. Online travel booking offers fast service without leaving the comforts of the home, but it does not often deliver the best option, such as finding the cheapest flight, and therefore many people still use ‘manual’ travel agents.

Integrated Real-Time Data Boosts Content Delivery

How to make content more relevant and appealing to the content consumer?

This is a problem that has been on the mind of content creators for some time now. In our age of information abundance it is not easy to stand out and make your voice heard. The competition for the consumer’s attention is escalating, and with the number of information sources ever increasing, it will only get tougher.

Traditionally, a content delivery does not change across the target audience. A commercial, or a blog, looks and is experienced in the same way by all viewers and readers. We are entrenched in this paradigm, and can hardly imagine it being otherwise.

It turns out, the advancement of new technologies capable of capturing individual intents in real time brings up new opportunities in creating personalized experiences within the framework of content delivery.

This is how content can become more relevant - by becoming more personalized.

In a rudimentary form, we are already familiar with this approach as seen in online advertising. Some web and social resources aim at personalizing their promotional campaigns based on whatever drops of behavioural patterns and interests they can squeeze out of our web searches. The problem, of course, is that the technologies used to power these campaigns understand human behaviour poorly and results, therefore, more often than not leave a great deal to be desired. To put it mildly.

nmodes has been working on semantic processing of intent for several years. We now can capture intent from unstructured data (human conversations) with accuracy of 99%. (Interestingly, many businesses do not require this level of accuracy, being satisfied with 90%-92%, but we know how to deliver it anyway).

We recently started to experiment with personalizing content by using available consumer intent.

We used Twitter because of its real-time appeal.

We started by publishing a story, dividing it into several episodes:

And we kept the constant stream of data flowing, concentrating on intent to dine in Paris:

We then merged the content of the story with consumer intent to dine in Paris as captured by our semantic software. Like this:

This merging approach shows promising results - the engagement rate jumped above 90%.

Overall we are only at the beginning of a tremendous journey. We know that other companies are beginning to experiment, and the opportunities from introducing artificial intelligence related technologies into content delivery are plentiful.

There is a long road ahead, and we've made a one small step. But it is a step in a very exciting direction.