Alternatives to bootstrapping?

Filed in archive Bootstrapper Resources on May 11, 2008

A post at the Global Security Challenge suggests these three alternatives to bootstrapping your new or existing business drawn in turn from an article in the Wall Street Journal:
• On line social lending networks. The post calls this a "credit-union matchmaker" and in this case the example given is Zopa.com. Read this for more details about how the site works
• A credit line on inventory and accounts receivable. A pretty standard way in which to turn value in your existing business into financing for growth, it is less of an option for startups than for operating businesses.
• Government funding from economic development groups. This is especially an option if your startup or existing business will create lots of jobs when it starts or increases in size.

I'm not sure I'd really call these alternatives to bootstrapping, however.

In the first example, the rate remains lower than a credit card, the method used by entrepreneurs like the founders of One Greek Store.

And nothing here will risk you loosing your home or control of your company as you might with a conventional bank loan or Venture Capital financing.

Some business cannot be started and many cannot be expanded without some kind of investment. The key for the bootstrapper is to finance a startup or expansion creatively without huge borrowing or capital reserves.

Photo Credit: Jane M Sawyer, MorgueFile