The Real Cost of Bootstrapping
How many times have you told yourself that if you only had a few extra hours in the week that you could start your own business? How many times have you seen money and opportunity squandered at other companies and thought “if I only had a business…”? Well you know what? I wonder if it’s better thought than executed.
Believe me, I am the biggest bitch in the neighborhood and I am also a person who thinks if I had $10 and 4 hours, I could make a million overnight. But bootstrapping (in real life) is a hell-of-a-lot harder than you think it is… and the costs aren’t just financial.
Bootstrapping is defined as “a collection of methods used to minimize the amount of outside debt and equity financing needed from banks and investors”. Having been inside at least three bootstrapping companies (I wouldn’t call all startups bootstrappers), I am pretty aware of the methods used by companies to minimize cost and increase profits.
But let’s turn this thing on its head and think about the real cost of bootstrapping a company with your spouse while you are still trying to maintain a day job (to fund your company).
Fuck finances, I think the real cost of bootstrapping is:
1. The Cost of Time and Life
Not everyone is lucky enough to have a savings account they can dip into or have been given a small startup loan. Some of us out there are working a day job to fund our prospective startup company. Such is the case with my wife and I. And you know what happens? My existing work slips and my lifestyle gets pinched.
I end up pumping out crappy work (which then endangers my “funding”) and I end up working until all hours of the night, not sleeping, eating Doritos like it’s the last substance on earth and never leaving my house for fresh air.
2. Cost of Relationship
After a 40+ hour week with my day job and another 20+ hours on the startup, the only thing you seem to have between yourself and your spouse is the pure language of timelines and economics. There ain’t no honeymooning when you are bootstrapping. You never get loving time and your marriage becomes all business.
In business terms… this is not a sustainable growth pattern.
3. Cost of Social Life
First off, let’s be clear: I never had a social life… or, at least, not how you are thinking. If going out on a Friday night, drinking more than 10 sailors, offending 90% of the people I meet, and eventually passing out on the couch while fighting with my wife is a social life… then I’ve got one. Otherwise, the idea eludes me. Though my point stands; when you never get to go out or you’re always talking about your company, you’re going to quickly find that no one is standing near you and your friends stop calling you for that “after work drink.”
4. Cost of Sanity
Let’s recap: working 7 days a week at about 70 hours, my relationship has become a business utility and I never leave my home because my friends don’t want to hear me talk about my ideas anymore… hmmm. I wouldn’t say that I was ever the “sane” type, but I did always have a grip on reality. And that grip is slipping like the California shores into the Pacific Ocean.
5. Cost of Self-Esteem
This is actually the biggest cost for me. I can deal with having no time to myself; I know that I can find time to repair my relationship; I don’t care about having a social life; and I kind of like the odd things that pop into my head now that I have lost my mind BUT the real problem is my loss of self-esteem. This has been the biggest cost in bootstrapping to date.
I thrive on self-esteem (everyone does) and consider it the element in my life that helps me think of how to build a better mouse trap and keeps me driving. The problem is, as you put more time in, you worry about failure and that worry gets to you quickly. You start to feel like you don’t know as much as you thought when you don’t hit the goals you set for yourself (or when you don’t yet have revenue coming in). I’ve had a lot of success in my life and I am great at pitching my ideas to myself and others… but when I don’t see results (because I don’t have enough time to hit milestones), I start looking in the mirror and asking ifI have been blowing smoke up my ass for the past 7 years. Or maybe everything I achieved was just a fluke.
Anyone can make money – anyone can make a lot of money. Funding your own business from a financial standpoint isn’t tough. You may not have as much money as you want to get things done overnight, but if you are smart enough then you’ll make enough to get yourself to the next jump off.
What will kill your business if you let them are the intangibles. The real cost of bootstrapping are those things that you’ll never put in a financial model or revenue forecast.
- Kris Keimig
Tags: Bootstrapping, startup costs