10 avoidable mistakes for bootstrapped entrepreneurs: 🧵
Bootstrapping takes a mental & physical toll on founders.
It did for me.
Had I avoided these mistakes, it would've been more bearable.
Success would've come faster too.
Steer clear of the following :
It did for me.
Had I avoided these mistakes, it would've been more bearable.
Success would've come faster too.
Steer clear of the following :
1. TOO MANY OFFERINGS
Whether services or features - less is more.
With limited resources solving two problems simultaneously is impossible.
Diluted messaging leads to confused customers & removes perceived expertise.
Customers choose experts.
100% on 1 offer.
Whether services or features - less is more.
With limited resources solving two problems simultaneously is impossible.
Diluted messaging leads to confused customers & removes perceived expertise.
Customers choose experts.
100% on 1 offer.
2. RESPONSIBILTIES:
Record roles in an operating agreement.
It prevents future arguments & creates clarity regarding who is doing what.
Job functions should align with strengths & desires.
Without a big salary, competence & passion are fuel.
Record roles in an operating agreement.
It prevents future arguments & creates clarity regarding who is doing what.
Job functions should align with strengths & desires.
Without a big salary, competence & passion are fuel.
3. TOO MUCH DEBT
Without investment, credit cards & high interest loans seem attractive.
They're not.
Financed working capital is long term pain disguised at short term relief.
Don't do it.
Stay lean & grow profitably with customer acquisition.
Without investment, credit cards & high interest loans seem attractive.
They're not.
Financed working capital is long term pain disguised at short term relief.
Don't do it.
Stay lean & grow profitably with customer acquisition.
4. FEWER MARKETING CHANNELS
Attention is like currency.
More is better.
But, the world is noisy & being loud is expensive.
Bootstrappers can't fund massive omnichannel campaigns.
Instead, go deep on one.
Maximize creativity & conversion.
Attention is like currency.
More is better.
But, the world is noisy & being loud is expensive.
Bootstrappers can't fund massive omnichannel campaigns.
Instead, go deep on one.
Maximize creativity & conversion.
5. LOW PRICES
The ideal future is realized by bridging today & tomorrow.
Low prices force a short term survival focus.
Without time to plan, the future stays some distant dream.
Low prices kill growth & attract subpar customers.
Raise prices!
The ideal future is realized by bridging today & tomorrow.
Low prices force a short term survival focus.
Without time to plan, the future stays some distant dream.
Low prices kill growth & attract subpar customers.
Raise prices!
6. CUSTOM SOFTWARE
Service companies - use SaaS as long as possible.
Custom systems will not yield tech valuations, but they do add line items that can't be eliminated.
Dev support & maintenance.
The wasted time & money isn't worth it early on.
Service companies - use SaaS as long as possible.
Custom systems will not yield tech valuations, but they do add line items that can't be eliminated.
Dev support & maintenance.
The wasted time & money isn't worth it early on.
7. NON IDEAL CUSTOMERS
Servicing non-ideal customers creates resentment towards them & the business.
Its an endless cycle of adding costs to service unprofitable jobs.
Intentional growth > Any growth.
Never add costs to service specific customers, it's not sustainable.
Servicing non-ideal customers creates resentment towards them & the business.
Its an endless cycle of adding costs to service unprofitable jobs.
Intentional growth > Any growth.
Never add costs to service specific customers, it's not sustainable.
8. PROFIT > CASH FLOW
Profit can be manipulated, but cash flow can't be.
Vendors & employees don't get paid with profit, they get paid with cash.
Learn the difference & make collection the top priority.
Profit can be manipulated, but cash flow can't be.
Vendors & employees don't get paid with profit, they get paid with cash.
Learn the difference & make collection the top priority.
9. LACK OF SALES PROCESS
Strategically identify the stages of the buying process.
Without them, all deals feel final as a "win" or "loss".
Most sales require nurturing & follow up.
Lacking a plan, many future sales are lost.
Strategically identify the stages of the buying process.
Without them, all deals feel final as a "win" or "loss".
Most sales require nurturing & follow up.
Lacking a plan, many future sales are lost.
10. DISCOUNTS
There are 3 outcomes:
1. Attract price shoppers
2. Offend past customers
3. Prospects wait for sales
All are detrimental to current & future cash flow/ relationships.
Frequent sales signal desperation & result in low margins - which doesn't help anyone.
There are 3 outcomes:
1. Attract price shoppers
2. Offend past customers
3. Prospects wait for sales
All are detrimental to current & future cash flow/ relationships.
Frequent sales signal desperation & result in low margins - which doesn't help anyone.
When bootstrapping, errors are inevitable..
But, you can make a concerted effort to avoid making mistakes other have made for you.
Start with the ones in this thread.
But, you can make a concerted effort to avoid making mistakes other have made for you.
Start with the ones in this thread.
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Follow me @barrettjoneill for content on business & growth.
Follow me @barrettjoneill for content on business & growth.
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