With the headlines hitting the newspaper every day about hoards of investments, it might sound pretty luring. In fact, stigmas exist that growth is by and large dependent on investments. The reality, however, is a whole new ball game. Deciding to go for investments is a big decision altogether and hence there are a good deal of things that are required to be taken under consideration. Is it the right time for investment? Does my startup really need investments? Should I consider bootstrapping for some time? These are the most common questions that hit an entrepreneur’s mind.
Yes, there is no denial that continuous investments are required to grow and generate profit. But bootstrapping is not a bad idea at all as there stands multitude of advantages. Especially if you are someone who has launched just initially, you have got enough reasons to bootstrap.
- You get a strong drive
If you are a family man, you just can’t afford to lose your way. Responsibilities are huge, and so are the dreams to sit in a lavish office cabin one day. If you bootstrap your company initially, you have no other option other than generating revenues. The path may seem long and lonely. Depression may lead you to hit the wall hard, but then, revenues mean an eagle’s eye which has to be hit. A positive energy starts to burst out of all the negative circumstances. You get filled with tenacity and grid. Also, as an entrepreneur, you start valuing money since bootstrapping means every penny matters.
- You are your own boss
Giving away equity instead of one-time cash simply means building a bond; a bond that will exist till your company exists. The result is that you start losing control. Now it’s no more just your decisions that matter. Moreover, actions and decisions start getting segregated once investors step in. Differences in opinions start popping up. Now it’s a team that you have built with members superior to you; superior in the sense of money dependency. So, after investments, you have a boss who will guide you and your startup. But wait, didn’t you start up to be your own boss?
- You lose focus
Startups may seem luxurious and investments may seem like a crown on it. But investments may become a bane rather than a boon. When you suddenly see a lot of money to scale up, you may start burning it double quick. You will not realize but by this time, you have started taking funds for granted. But remember this is not a long term thing and you are bound to make returns. You may enjoy short term results- customers, revenues, employees, fame and nonetheless parties but long term results can be fatal for your startup.
- You get a positive result if you wait
The idea you are working on may not be convincing enough. Experience has shown that you meet 50 investors and only 5 of them show interest. Why not prove yourself? Bootstrap, scale it up, and don’t waste time. Put your energy in building your product. Why not let the investors come to you? Why not let them accept your idea at one single shot? That can happen only after you make a good market presence. Investors get really impressed by numbers, I tell you! So, go ahead and don’t let your business ideas end up as a record of your aspirations while waiting for funds.
- It eats a lot of time and energy
Raising funds is a nightmare for early stage startups. It is like a marathon that you need to run every day to the investor’s office. You are consumed with meetings and your life starts revolving around pitches. The irony is you pitch your product several times but you yourself get lost and lose focus on building it. If you are just starting, it is time that you believe in yourself and do your best to keep your customers happy.
- Investors may take a different position
It’s not just the amount of money that’s a huge factor to consider, but also the right investors to seek money from. Most of the investors may turn into mentors while some may get bossy. Some may help, some may not. Some may become your partners in the long run if you are in good terms with them. Some may become a Trojan horse while some may become well-wishers. So they may take different positions in your life and this may not look appealing enough. Nobody wants deep penetration when it comes to their life. And a startup is an entrepreneur’s love, life and breath.
