‘Bootstrapping – Doing more with less’ is a book meant for would-be entrepreneurs and everyone else who want to understand more about how people start businesses with limited resources. This book has been written by Sramana Mitra.
“In this volume, we explore a dozen stories of entrepreneurs who have mastered the art of doing more with less, creating a lot many options in the process”
That summarizes the book in the words of the author. The book starts with an explanation on how people starting a new business have a steep learning curve ahead, and how that becomes a reason for Venture Capitalists to not invest in first time CEO’s/their ventures.
“Don’t look simply for capital, but look for mentor capital”
What is the option then, for first time CEO’s? The author suggests that they could look at getting investors (like Angel investors) who have had prior experience in mentoring similar businesses and more importantly, have a lot of valuable industry contacts which could be useful to grow the business. Well, the investors do charge a hefty sum and they might as well contribute to the business.
Once the business has been established and the business model proven, it might be easier to get Venture Capitalists to fund further expansion.
Entrepreneurs could also consider funding their ventures by themselves (with help of family/friends) or even start a venture without much investment. In this book, the author interviews people who share their experiences on how they started their venture with their own (limited) funds or no funds at all!
“The best money comes from customers, not from investors”, says Greg Gianforte.
Well, Greg was one of those entrepreneurs who was interviewed and he says that he started his venture, ‘Rightnow’ with an investment of $50,000 and his office was an extra bedroom in his own house, initially. Later on, they expanded to 75 people and were making $25 million in revenues, before getting sold to McAfee.
Cree Lawson of Travel Ad Network started his venture by getting the best publishers (with travel based websites) to form a network and sold the combined ad inventory to advertisers. Individually, the publishers might not have been able to make much money, selling ads. But as a group, there was a clear value proposition which appealed to high quality advertisers.
Mobissimo was another such venture in the travel domain. Beatrice Tarka, the founder of Mobissimo created a travel search engine which allowed users to search for the best travel deals across a lot of travel websites. Others interviewed in similar segments were Om Malik of GigaOM, Rafat Ali of PaidContent, J.R.Johnson of VirtualTourist and Guillaume Cohen of Veodia.
“One of the big learning experiences for me, as a first time CEO, is bringing in smart people who are much better than I am in their fields, then staying out of their way” – Guillaume Cohen, Veodia.
Wayne Krause was another entrepreneur who was interviewed in this book. His venture was, “Hydro Green Energy”.
“I remember seeing a National Geographic drawing of a big ocean device to create energy and I kept thinking that there had to be some way to make energy out of these waves. That’s how it started”
Have you ever seen sea-waves and wondered, ‘Wow, that’s a potential source of energy?’. Well, that’s what this entrepreneur did! After a long struggle and some luck, he developed the technology to convert the energy of the sea waves into electricity. He plans to sell both energy and the patented equipment design. Helping the world go green while making some money, is a good idea!
Then we get to read about Scott Wainner of SysOpt/ResellerRatings (review platform for small resellers/stores) and Ramu Yalamanchi of hi5 (social network).
“No matter how many businesses you start, it just takes one successful business to make up for all the other attempts” – Ramu Yalamanchi, hi5.
Then, there is Murali Thirumale of Ocarina who created a business out of reducing the ever-increasing data storage costs, for enterprise customers. Manoj Saxena of Webify says that he built his company (an e-commerce platform) out of a $200,000 initial investment raised by him using ten of his own credit cards. Now, how many of us would think of that? 🙂
“Take a little money and build a lot of value” – Manoj Saxena, Webify
Probably the best was saved for the last – Lars Dalgaard of SuccessFactors (HR solution for businesses). This was definitely the most entertaining, frank, energetic and informative interview.
“I just went in there (auction house, where they were selling some failed dotcoms) and I made a credit bid, which means I said, ‘I’ll take on the debt for this company, personally’. I was taking on $3.2 million in debt to own this company”
I felt that some of the interviews could have been longer and the author could have probed for additional information. Also, the unnecessary advise to Obama could have been avoided.
It’s a good read if you are looking for inspiration from others on how they managed to start and hold on to their ventures, in spite of having little or no capital. The book is structured in an interview format that makes it easy to read. This book is a bunch of real-life case studies, actually. Recommended for weekend reading.
- You can buy ‘Bootstrapping: Doing More With Less’ by Sramana Mitra from Amazon.in in India. [Disclaimer: This is an affiliate link. I may get a small commission if you click on the link and buy the product. Your price will not change.]