Bootstrapping Strategies PDF

Bootstrapping Why Bootstrapping? "Army boots" by liftarn is licensed under CC BY-SA 2.0. Bootstrapping creates solid and independent businesses But most incubators don’t teach it We will discuss why it’s a great approach for (social) entrepreneurs...

Bootstrapping Why Bootstrapping? "Army boots" by liftarn is licensed under CC BY-SA 2.0. Bootstrapping creates solid and independent businesses But most incubators don’t teach it We will discuss why it’s a great approach for (social) entrepreneurs Jan 18, 2023 “Make bootstrapping sexy again” Jan 18, 2023  Capital is a Distraction Money teaches "Cat" by be creator is licensed under CC BY 2.0. entrepreneurs bad habits Capital harms product/ market fit Starting “lean” creates a solid foundation Raising capital is a lot of work Jan 18, 2023 Extraction Hurts Businesses Extraction of cash from a company is a competitive "California Oil and Gas" by blmcalifornia is marked disadvantage on the market with Public Domain Mark 1.0. Cash that is extracted can’t be reinvested in: R&D, higher pay, lower prices, better quality Ikea is a good example of a (non-social) non-extractive business Jan 18, 2023 Network Effects + Economies of Scale “Network effects” and “economies of scale” are widely misunderstood "Social Network" by neil cummings is licensed under Startups rush to gain market saturation, and “defeat” the (dominant) players on the market, CC BY-SA 2.0. assuming that business is “winner take all” and a zero-sum game We think: “Once we’re big enough, our business model will sort itself out” This “one big push” is hard to pull off Jan 18, 2023  Playing Darts There’s 2 ways that I can approach a game of darts: "Darts" by rafael-castillo is licensed under CC BY 2.0. 1. Stand across the room, and throw the dart 2. Walk across the room with my dart, and place it in the middle of the target This analogy describes the difference between capital-fueled hypergrowth vs. bootstrapping Jan 18, 2023  Software Engineering In software engineering, we build a machine can #iterate — #agiletourlille #sketch… http:// "Software development is upside down @allankellynet — bit.ly/2eduWZ5" by flexbox is licensed under CC BY 2.0. have similar concepts: Waterfall model Agile DevOps Lean Startup is the “agile of business” What is “DevOps for entrepreneurship”? Jan 18, 2023 Bootstrapping Principles "Concept principles" by psd is licensed under CC BY 2.0. Jan 18, 2023  Stone Soup Parable A poor man picks up a stone and uses it "Day 140 - Made up soup" by Phil and Pam is to collect ingredients from farms, to make a soup for everyone to share licensed under CC BY 2.0. Entrepreneurship works similarly: The poor man had a vision - his task was to convey his vision to others, collecting complementary elements It succeeded! His vision was realized, and all stakeholders were happy in the end. Jan 18, 2023 My Version of the Parable Jan 18, 2023 Talk To Everyone Who Will Listen Talk to anyone who will listen to you "Conversation" by ibm4381 is licensed under CC BY 2.0. You will gain increasing clarity as you repeatedly tell your story People are mirrors who reflect things back Listening is important Ask people about their pains, and inquire what solutions they would (and currently do) pay for Steal the best bits of feedback, and integrate them into your MVP If you don’t know where to start, read ‘The Mom Test’ Jan 18, 2023  Preach To Your Choir We don't need to convince everyone "Christmas Choir #2" by It's No Game is licensed under (including the 1% and politicians) Some people will never agree with our ideas, and that’s fine Start with those who understand and are CC BY 2.0. enthusiastic Mobilizing our “choir members” gets us started As we find success, our project will gradually move into the mainstream Read: ‘Crossing the Chasm’ Jan 18, 2023  Start Small Think big, start small "Austin through a magnifying glass" by oddharmonic is Moonshots ambitions are fine - but every journey begins with a single step licensed under CC BY-SA 2.0. Read ‘The Lean Startup’ Don’t put too much energy into early stage ideas Don’t get too focused on building technology Don’t make a detailed business plan A Business Model Canvas is better Jan 18, 2023  Refactoring Keep overhead low to start Find a service that launching customers want to "New York City - Home of the Repeating Patterns" by pay for kevin dooley is licensed under CC BY 2.0. “Refactor” as your business grows: Refactor repeating activities into a process Create a small piece of automation to perform a repeating process This is all financed by reinvestable margin These small pieces of automation will gradually and organically evolve into a supporting platform You will step back and realize you’ve developed a solid revenue base + critical mass of IP + processes + staff Jan 18, 2023  PGE Playbook Act I: How To Get Started Make sure that you’re not starved for money when starting. If you are, get a part-time job to earn enough money per month to take the edge off your desperation. It’s hard to build something with patience and integrity when financially desperate. Understand that no matter how ambitious you are you need to start TINY and grow organically. Growth must be financed by turnover! Avoid unnecessary overhead (offices, equipment, internal employees) - you won’t need this at the beginning. Setup your legal entities and Statutes to be as non-extractive as possible. (Consult a PGE knowledgable lawyer.) This is essential to avoid mission drift later. Jan 18, 2023  PGE Playbook Act I: How To Get Started (2) Start with the pain in the market. What kindof service you can offer that someone would be willing to pay for? Get them to put their money where their mouth is. As long as customer requests align with your values and interests, leverage freelancers (and your own time/energy) to fulfill those services, paid by your launching customers. Start out doing everything by hand - give everyone involved concierge treatment. Pair producers with consumers. Make sure that both are treated like kings! The key to success is finding arrangements that are win-win-win. (Win for the Producer, Win for the Consumer, Win for the Platform). Business is the fine art of getting interests aligned. Business is NOT a zero-sum-game, where someone wins and someone loses. Jan 18, 2023  PGE Playbook Act I: How To Get Started (3) Perform lots of experiments (MVPs). Expect that some percentage of what you try will fail - and that’s okay. Fail, fail again, fail fast. Collect validated learning. Pivot to follow the pain in the market. Repeat and remain flexible. Rely upon word-of-mouth and “evangelism” (conference talks, workshops, media coverage, etc..) for marketing. If what you’re doing is sufficiently valuable to your ecosystem, this is the only advertising you should ever need. Start to refactor processes when you see frequently occurring activities. This is financed by margin on your revenue. Build a piece of automation when you see frequently repeating processes. This is financed by margin on your revenue. Jan 18, 2023  PGE Playbook Act I: How To Get Started (4) Isolated bits of automation will evolve into a supporting IT platform over time. With time and patience, you’ll discover that you’ve built an entire platform of IP + processes + staff - all financed by reinvested margin. This platform will make things progressively smoother - and your margin will improve. This is when network effects and economies of scale kick in. Focus on delivering quality and maintaining a stable happy ecosystem - NOT on growth! Growth should be a byproduct, not an objective. As you progressively hire staff (supported by customer revenue), you can delegate more and more of your responsibilities to others, to create room for strategic thinking and creative projects on your side. Jan 18, 2023  PGE Playbook Act I: How To Get Started (5) If you’re patient (and pivot when something isn’t working), then the critical mass of what you’re building will gradually increase over time. One day, you’ll look back and realize that your progress isn’t so slow anymore. Over time, you will (slowly) start displacing the (less socially inclined) market leaders. Exiting is not an option. (If you setup things right, this should be impossible.) If/when you ever get bored of your company, delegate more and more of your work to your staff until you’re no longer needed. Create a succession plan. Then decrease your hours (or leave completely) in order to focus on something else. Congratulations.. you’ve built a non-extractive business of integrity that will live on for long after you’re gone. Be proud of yourself, and realize that you’ve left a positive legacy in this world. And if enough of us do this together, we can change the world for the better! Jan 18, 2023  PGE Playbook Act II: Serial Entrepreneurship Think about your next steps: what non-extractive passion project do you feel called to start? Can you find a commercial service to provide, grounded in the pain of a market? Can you get it launching customers? Go through the bootstrapping process again - your old business will continue growing (aided by support staff), and you can spend your time and energy bootstrapping the new initiative. Your original company can even help to support your new one, as long as it’s win-win. Rinse and repeat! Don’t forget to also take time off. Even heroes need rest sometimes! :-) Jan 18, 2023 Possible Non-Extractive Companies Here’s a few ideas, that are by no means exhaustive: Non-Extractive SW Development "Hippy-Dippy-Kaleidoscope-640x960-115319d3" by Non-Extractive Music Streaming Andrew Norrie is licensed under CC BY 2.0. Non-Extractive Carbon Offsetting Non-Extractive Circular Waste Handling Non-Extractive Accountancy Firm Non-Extractive Law Firm Non-Extractive Childcare Platform Non-Extractive Food Delivery Platform Non-Extractive Bank Non-Extractive Insurance Company Non-Extractive Pension Fund These are just a few examples. The possibilities are endless… Jan 18, 2023  Business Model Recipes Pick any kind of company, and "cookbooks 009" by Polka Dots and Pastries is licensed imagine a non-extractive social version of it Hypothetically work through its under CC BY 2.0. bootstrapping process on paper We can create a “cookbook” of such “business model recipes” Some people suggest recipes, other people may decide to “cook” them Jan 18, 2023 What Does This Look Like In Practice? Feb 1, 2023  PGE Startup Bootcamp 5 days in Terschelling (Feb 2020) Left brain + right brain Combination of traditional startup bootcamp and personal development retreat Diverse organizer team Jan 23, 2023 Journey Jan 23, 2023 Journey Jan 23, 2023 Location Jan 23, 2023 Location Jan 23, 2023 Ideation Jan 23, 2023 Check-In Jan 23, 2023 Community Jan 23, 2023 Nature Jan 23, 2023 Peer Learning Jan 23, 2023 Presentations Jan 23, 2023 Art and Culture Jan 23, 2023 The New Normal Jan 23, 2023 Online PGE 10 Week Incubation Program Jan 23, 2023 2022 Cohort Jan 23, 2023 Monicah Muhoya (PGE 2021) Jan 23, 2023