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:

AI unmasked: How a chatbot is different from a voice bot

The main difference is in the linguistic complexity.

People express themselves differently when they speak compared to when they type. When we speak we use more sentences and we make our sentences longer.

As a result a voice bot needs to have better AI compared to a chatbot, in order to handle a conversation and deliver the same customer experience.

If your business model allows it, is better to start with a chatbot and add a voice bot on top of it.

This way you can gradually increase the complexity of your AI without compromising on your customer experience.

WHY LONG-TERM SUCCESS OF YOUR BUSINESS DEPENDS ON CONVERSATIONAL AInmodes.com

Social selling. Difference between Facebook and Twitter

There are obviously some key differences between Facebook and Twitter that make them appealing to different people as well as businesses. If possible, businesses should try to leverage both networks in their marketing and sales efforts.

But marketing approaches for each network differ. Consequently social selling approaches differ as well. Here are some major differences of the two networks that impact sales strategy:

- Twitter lets all the accounts commingle, Facebook makes a definite distinction between business and personal. This can be an issue because a business page cannot proactively connect with individuals with personal profiles. Individuals have to first like a business page and still the business can’t reach out to them directly unless they message first. This is not the case with Twitter, as anyone can follow pretty much anyone.

- Facebook preferred way to market products and promote online sales can be compared to a showroom. The prospects can see the product and purchase it through some other channel, however engagement (with prospects) is limited to friends and followers. Hence growing the number of friends and followers becomes a critical task on Facebook. Twitter does not offer promotional capabilities but engagement activity is not limited to followers. The engagement on Twitter is therefore more straightforward and can lead to direct sales.

- Facebook user data is typically open to friends or followers. Twitter data is typically open to the entire world.

- Twitter is fast (minutes). Facebook is slower (hours and days).

- Twitter is more about building a brand identity. Facebook is more about business relationships.

To summarize, a direct timely engagement could be a good strategy on Twitter. In a typical scenario a user tweets that she needs a taxi or asks where to dine tonight. A taxi company or a relevant restaurant engages in a conversation and secures a customer. It is an efficient approach with immediate ROI.

On Facebook a good strategy is to grow and educate a community of followers. Facebook is excellent for promotional campaigns. This is a longer-term strategy with effects not visible until after several months.