Know Why Bootstrapping Your Company Is Good For You

Whether to seek external funding or take the bootstrap route is a common dilemma in entrepreneurs. Many entrepreneurs take the help of funding to make sure there are adequate resources and to reduce risks. Because entrepreneurs think that will help them to grow their business faster and quicker.

But many companies have proved that bootstrapping is also a very effective formula that works. Companies like GrabOn, Zoho and Wingify are some of them. CEO of Zoho Corp Sridhar Vembu has said that it has helped them to be bootstrapped. Because they want to stay uncompromised in their business field. Zoho is a unicorn company, and the revenue of this company has grown to INR 4,274.7 crore in 2020, which was INR 3,308 crore in 2019.

The most satisfactory advantage of bootstrapping is having the freedom in decision-making. Because when you take resources from outside, you will always be under pressure that you need to make the other person happy with your work. There will also be pressure upon you that you need to achieve quick success.

If you are taking money from outside resources then you are sharing your own with them. But if you have been bootstrapped, then you have been the owner of 100 per cent of your business. You may lose the sense of equity in your business.

Entrepreneurs always have a clear vision of their company when they start their journey. But as the entrepreneurs keep on adding people to the company, there will be more deviation in that goal that the entrepreneur has set in the beginning. A positive cash flow and profits takes an important role for bootstrapped companies to survive in the market.