Four Lessons Learned On Bootstrapping A Company

Cofounder and CEO, Berkley

Raising money for your business is always exciting, but to many entrepreneurs, nothing beats the feeling that you bootstrapped your own company and own 100% of it.

No investors, no bank and nobody to report to seems pretty cool, right? But don’t be so quick to assume. If you choose not to raise money and don’t understand the amount of financial stress this route can put on your business, you could sacrifice your own growth. Want to make that great VP hire? Sorry, you might not be able to afford that because you need to make payroll and pay your vendors.

So, how do you go about bootstrapping your business successfully? Here are some of the most important considerations to keep in mind.

1. Always be selling.

Without sales, you have nothing. At least, this is the case in the world of a bootstrapped company. Companies that raise significant amounts of money might be able to get away without making sales for a while, but if you are bootstrapping, sales are the thing that will keep you in business.

To get started, focus on your customers, and understand their needs. Understanding their needs might even lead you to update, change and improve your product or service.

This is your lifeline and your only lifeline. I was fresh out of college with no sales experience when I decided to bootstrap my own company. I picked up the phone and made hundreds of cold calls per day. I recorded myself, reviewed the recordings and got better and better and talked to prospects about my company.

You have to go out of your comfort zone and put yourself out there.

2. Don’t expect to make millions.

I reinvested every dollar for the first six years in business. I took no salary in the first year and a very small salary and no commission for the next five years. We needed every dollar to grow and make great hires. I had friends making more money than me, but we were grinding it out and building a foundation for future scale. I saw the bigger picture and the future.

My company now has more than 50 employees and has grown its sales significantly. Because of those early decisions we made and running the company to always be profitable, my business has a solid foundation that we can scale.

However, pushing through those challenging early years isn’t always easy. For this reason, stay laser-focused on your vision. You started your company, and your customers are buying your product for a reason. Stay true to yourself and know that there is a bigger picture here. A few years of running on tiny budgets and losing sleep can pay off for the rest of your life.

I also suggest finding a co-founder, business partner or mentor you can talk to about struggles and hurdles. Having someone by your side with whom you can discuss ideas is invaluable.

3. Find ways to make the journey less lonely.

I’ll never forget when my roommate was coming home from a night out when I was leaving for work in the morning. When you’re an entrepreneur, you might find that all of your friends went and got great jobs and immediately made friends at work. They have work happy hours, off-site retreats — all that fun stuff.

Meanwhile, you are in your office making cold calls trying to grind out a dollar. Again, I can not overstate how valuable a cofounder can be for your journey. My dad is my business partner and mentor. Without him and those thousands of conversations we have had, our company would not be where it is today. Share your thoughts and feelings with your mentor. Sometimes, just saying things out loud can make you feel better. Connect with other entrepreneurs. I promise you, they are going through the same things as you. There is comfort in that. Drop your ego, and don’t go at it alone.

4. Be OK with being scared.

Bootstrapping a business is scary. It’s your own money. You will have to work early mornings and late nights and likely won’t be able to make very much money from the business for a while.

Every business also hits a stage where they need to take the next leap. As we grew, we had to make some big and expensive hires to keep growing. You can’t do it all by yourself. When we grew even more, we had to take that next big step and open a new office and invest millions in new salaries to secure top talent.

It’s scary to take that next leap. You have worked so hard to get to where you are at, and you are jumping into the unknown. Again, you’re investing all your hard-earned money back into the business. And it never ends if you want to keep growing.

But you have to just do it. Like Maverick says in Top Gun, “Don’t think. Just do.” You might tell yourself 100 stories in your head and make excuses not to do something for the business. But I believe that if you aren’t scaring yourself a little, you aren’t pushing yourself to your limits. Life is all about the experience. Even if you fail, wouldn’t you rather look back in 20 years and be happy you tried it, rather than always wondering, “What if?” You don’t want any regrets in life.

I won’t sugarcoat it: Starting and bootstrapping a business is hard. Really hard. But getting through the lowest of lows and pushing yourself beyond your limits can help you come out the other side stronger. It will make you more resilient not only in the business world but also in your personal life as well.

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