Should You Bootstrap or Seek Investment?
So, you’ve launched your MVP and have been anxiously wondering, “Should I raise funding or bootstrap my startup?”
(By the way: If your product isn’t live yet or you haven’t received market validation, do that first. You’ll have a much better time.)
At my last startup, I applied to two angel investment networks, got rejected, then decided I’d just continue bootstrapping. Why? Because I could continue running the startup without investment. Sure, investment would have provided a whole different set of opportunities, but I eventually came to the conclusion that it wasn’t necessary.
And I was glad I did.
Investment isn’t right for everyone. Then again, neither is bootstrapping. Every company is different.
Here are a few things to keep in mind when deciding whether or not you should bootstrap or seek investment:
Do you really need funding?
Ask yourself why you’re looking for funding. How much work can you do on your own? If you have a diverse skill set, you can probably take on a lot of necessary tasks on your own. Yes, it will be a lot of work, but if you are passionate about your startup, it won’t seem like work.
Were you going to use most of that budget to hire a developer? Well, brush up on your coding skills and learn to do it yourself by taking some online classes. Udemy and Code School offer some great courses.
The more skills you acquire, the more prepared you will be as a founder.
Alternatively, you can talk to friends and see if they’re interested in your idea. Find a co-founder with complementary skills and build a lean, mean founding team. You can offer up equity.
For founders, raising funding is a full-time job. It’s time consuming and you really have to be on top of your game. Between creating pitch decks, investor meetings, networking, building an AngelList profile and running your startup, there won’t be much time to spare.
If raising capital is the answer for your startup, it’s totally doable if you manage your time efficiently. Many startups outside Silicon Valley have done it, so don’t get discouraged.
It all comes down to what is best for your company. If funding is required to meet certain necessary milestones, then it might be the solution for you.
If, however, you are able to run your startup and gain traction without funding, why not continue bootstrapping and see how it goes?