Startup funding and bootstrapping

The article addresses various issues that face any entrepreneurs with an idea that they aspire to have grow into a profitable and significant business. It represents the various decisions that an entrepreneur has to make in order to distance themselves with things which can drag them back or prevent them from realizing their business dreams.  Ryan had to decide to venture out all by his own after years of working as a sales and business development officer, which allowed him to launch his startup in partnership with another partner. The courage to step away from this startup with a partner was an important starting point which allowed him to figure out a better way that would be his next venture. Finding Marco was the other main thing that enabled a startup idea to be borne and even implemented as a part of pilot project. The skills that Marco and Ryan possessed complemented each other more so for the technological business having worked for considerable time in the previous businesses from which they stepped away.

The concept the two settled on stemmed from an opportunity arising from the challenge Ryan experienced in their last business, which involved difficulties in finding email addresses for contracts that are hard to reach. The idea of SellHack, however, came with various challenges that includes the legality if the business ideas, whether to look for funding or turn to bootstrapping. Bootstrapping a venture requires a lot of courage especially when one is not sure about the outcome of the idea in terms of business and profitability (Cohan, 2012). Bootstrapping can be an excellent strategy that could assist the venture to move from the trial stage to a full introduction into the market, since the startup like SellHack is hard bent on achieving profitability. This strategy would allow Ryan and Marcus much freedom when it comes to decision making and even wider scope in following their instinct with the experience they have from past startups and work in technology and sales business. In addition, bootstrapping is quite effective in ensuring that there is positive flow of cash (Koester, 2016). When Ryan and Marco put themselves in the sink situation, they are aware of the hunger they to carry out their venture right. The start-up when bootstrapped would mean that the owners have to develop a business model and adopt innovative means which are as effective as possible.

However, if the business was to be conducted through a website which allowed many users to sign up for the SellHack, an opportunity would be available for the converting these into paying customers. This would require a lot of funding in order to market the idea to the potential customers. To get as many people as possible to convert paying clients would require funding even by outsiders or venture capitalists so that to get the business going and profitable. The advantage of funding in this case is the amount of resources that would be at the business exposure to acquire and maintain experienced and talented individuals who can steer the startup towards innovation, growth and profitability (Koester, 2016). Even though bootstrapping would allow Ryan and Marco to build something that is worth funding, funding can allow for growth.

Questions

At what point should an entrepreneur consider bootstrapping and funding of a startup business?

Would it be better for the business to combine both funding and bootstrapping?

How should an entrepreneur avoid the legal conflicts while establishing a start-up?

References

Koester, E. (2016).Green Entrepreneur Handbook: The Guide to Building and Growing a Green and Clean Business. CRC Press .88-82

Cohan, P. S. (2012). Hungry start-up strategy: Creating new ventures with limited resources and unlimited vision. San Francisco: Berrett-Koehler Publishers. 71-73