Bootstrapping brings competitive advantage

Filed in archive Bootstrapping Thoughts on December 16, 2007

So, why can having no or limited money and resources be an advantage?

Well, consider these possible competitive advantages that a bootstrapped enterprise might have over better funded corporate enterprises or even independent entrepreneurs:
• The power of instant gratification. Well backed businesses can go for a while without making a buck or turning a profit. The good side to that is that they can wait to develop a market. The bad side is that it will take them longer to realize there isn't one.
• The power of concentration. Trapped in the Wilderness with limited food or water will force you to conserve. Limited money and resources will make you use what you have most efficiently.
• No need to make a phone call. While a better funded business is contacting the board of directors to discuss a trend, you'll already be exploiting it and moving on to the next.
• The best products sell themselves. And you'll need these because you've got no money for marketing.
• Nobody likes a know-it-all. Investors will be sure at some point that they know better than you how to proceed. If they're right, the tug of war may cause funding to dry up. If you're right, your business will go downhill listening to their advice. Bootstrappers succeed or fail based on just one thing. The success of their business model.

For more on the benefits of bootstrapping, see Greg Gianforte's tips and please join our Bootstrapper's Yahoo! Group to talk with other bootstrappers and those interested in business bootstrapping today.