I've bootstrapped 3 startups and raised money for 1, here are my thoughts on bootstrapping 👢 vs. raising money 💰:
In 2018, the quality bar has never been higher for startups. You need 💯 design, product, copy and marketing. As a bootstrapper, you're forced to make sacrifices in one or more of those areas. This makes it harder for you to win.
Raising money gives you more resources, faster. Even if you're first to a market with a head start, you can lose if you don't have enough money to accelerate growth.
Without raising 🤑, you're digging deeper into your own pocket. I've sunk thousands and thousands of dollars into my previous bootstrapped businesses.
Competition is everywhere. It's not your direct competitors you only need to be concerned about, but all the competition for your customers' time. Without raising money, you'll have very little money (if any) to spend on marketing (people or ads).
As a bootstrapped startup, your accountability is to yourself, your teammates, and your customers BUT investors can be a nice kick in the ass. The extra pressure is a good forcing function to staying on track and staying mindful of your numbers.
You get to keep more equity in your startup if you bootstrap... sometimes? When bootstrapping my first 3 companies, I gave up more equity to co-founders and teammates than when I raised money.
One thing that you can't dispute is that NOBODY can tell you what to do when you're bootstrapping. This can lead to more freedom to explore new ideas and new product features, but you have to be careful not to lose your focus.
Is quality of life better when bootstrapping? Nothing has really changed for me since raising money. I work just as hard as before, so 🤷♂️.
While I'd call you crazy 5 years ago if you told me I'd be coming out in favor of raising money after bootstrapping my first 3 startups, I do think it's preferable if you can raise money at good terms from great investors.
