Many of you Geekpreneur readers are probably dreaming of a successful entrepreneurial career. If you haven’t started, what’s stopping you? Sure, funding isn’t exactly easy to find, especially with current goings on in the market. However, bootstrapping a business is just as relevant as before, maybe more so, and the Internet makes it easier in many ways.
What Is Bootstrapping?
Bootstrapping, in a nutshell, is a simple business self-financing process whereby an entrepreneur spends only what is absolutely necessary and reinvests most or all of the profits until the business is self-sustaining. Or sold. I.e., little or no outside capital is used, at least initially.
By bootstrapping, entrepreneurs have built many successful businesses. If the business means enough emotionally or financially to the entrepreneur, the lack of capital can be the impetus to run the startup as efficiently as possible. Or they can go broke trying – which does happen, of course.
One of the most entertaining examples of the application of a bootstrapping mindset comes from the website One Red Paperclip. The right-hand sidebar has a pictorial explanation, but it goes something like this… Canadian Kyle Macdonald started with one red paperclip and, through a series of swap transactions across North America, managed to end up with a house. He started with essentially nothing and kept trading up in each transaction.
The fact that other people participated made a huge difference, of course, but these people were likely fascinated by his mindset and were glad to participate. Now this is not exactly how bootstrapping works, but the mindset is similar: start with what you have now and build it into something better. Kyle Macdonald did “work” for each transaction by starting conversations with people and promoting his “cause”. This helped him achive the transactions he needed to increase his “value” until he got what he wanted.
You can apply a similar bootstrapping mindset to a business startup. Even for an offline business, you can leverage the Web to promote and build your startup.
Mind Mapping Your Bootstrapping Plan
For this article’s example, I’ve used MindJet MindManager Pro software to create the mindmaps. You can get a free, fully functioning trial of MindManager Pro for Windows (30 days) or Mac (21 days).
Alternately, you can use any other mind mapping package, including FreeMind (multi-platform), Mindomo, MindMeister, or Comapping. (The latter three are web-based and only basic or trial versions are free.) Note: Mindomo has a desktop version which actually runs on Adobe Air.
Mind Mapping Process Overview
The assumption here is that you are picking an entrepreneurial opportunity that has some potential, and that you’ve done your research already. You’re simply going to map out your current status and some of the goals that you hope to achieve. The example I’ve used below is for building a web video publishing business.
Start with two nodes: here/there, start/end, now/then or whatever you prefer. I’ve used Now/ Then in the example.
See the diagram above.
For the “Now” node, list what you have to start your business with, including equipment, skills/ knowledge, leads, partnerships, startup funds.
For “Then” node, list what you aim to achieve. Include a time frame if possible (but be flexible), what revenues you’d like to be earning and how, whether you’ll have any staff or freelancers, equipment, etc.
This is an administrative step I’ve added simply for reader clarity. Here, I’ve split up each list to prepare them for Step 4.
Pair up current and desired items as best as possible, using a “strategy” node between pairs. In some cases you might have multiple lines in or out of a “strategy” node, as per the diagram above. Use what’s appropriate for your business scenario.
Now fill in each strategy node with a brief note about what approach you might take. Don’t get too detailed just yet. Keep bootstrapping principles in mind: spend only what you have to; reinvest as much of the profits as possible.
You now have a very basic roadmap for working towards what you want business-wise. By breaking down short- and long-term tasks this way, the process should feel less intimidating than, say, “achieve success in this venture”.
Of course, you’re not done yet. This is only a starting point. You still need to produce a more detailed plan for each strategy node (not to mention perform all the necessary tasks over time.) If you’re using mind mapping software to produce the detailed strategy mind maps, you can link each strategy node to a sub-map. So your master map will be organic, growing as necessary, or linking to new sub-maps.
To produce the detailed strategy maps, use whatever methods of problem solving (e.g., brainstorming, visual thinking, etc.) that you prefer. Use diagrams and images in your strategy maps, to help visualize what you are working towards. Try listing multiple options and later filter out those which are not feasible. Let your overall bootstrapping plan develop.