A Love Letter to Bootstrapping, Part 3
In honor of Independence Day this Friday (if you’re in the U.S., that is, which we at Snappy are!), we’re continuing our ongoing Love Letter to Bootstrapping series with a celebration of FREEDOM!
Our founder Ian gave me a list of arguments for avoiding venture capital investments in favor of “pulling yourself up by your bootstraps.” A list of the true costs of VC funding. (read Part 1; read Part 2)
The third item on that list is that bootstrapping allows a kind of freedom and flexibility unheard of in the VC-funded world.
Freedom can mean many things, and we touched on some of its definitions in Part 2, Loss of Control. That point was specific to how you run your company: When you maintain full ownership of your company, you maintain the freedom to run it how you like.
The other side of this coin is that you maintain control not only of your company, but of your entire life. A bootstrapped entrepreneur enjoys liberties unavailable to virtually everybody else on Earth. When you hear a disillusioned employee grousing about his boss, and expounding on his pipe dreams of working for himself someday, he’s not dreaming of trading one boss for another in the form of a VC investor. No, he’s dreaming of being his own boss.
The impetus behind the dream of entrepreneurship has always been the freedom inherent in “working for myself.” And what does that entail? For most of us, it’s about more than just building a company the way we want to build it.
It’s about quality of life.
Work when you want
I love bootstrapping. While I don’t think that bootstrapping is better than funding (or the other way around), I think it’s the right approach for me right now. That’s because the most important things to me are freedom and flexibility.
For example, I’ve gone months working less than 5 hours a week. I’ve gone years working 10 to 20 hours a week, while still growing a profitable company. I can live anywhere, travel as much as I’d like, and keep the team as small as I want. I also never have to explain myself to anyone. As a bootstrapper you’re 100% free to build the type of company you want.
Of course, I worked hard to get to that point, but it’s something that anyone can do as long as they’re providing value and keep their goals in mind when making decisions that can change the business.
How many of us are truly at our best every weekday from 9 to 5? Many of us work better early in the morning, or late at night, or in two-hour blocks spread out over the day and punctuated by long naps. How many of our jobs truly fill exactly 40 hours per week? Maybe we finish all of our work in 4 hours a day and spend the rest twiddling our thumbs, racking up the hours until we can go home (not you. I know you don’t do that. But I’m sure somebody out there does).
If you owned your own business, you could just stop when you were done, and start again when you chose. You could work in the middle of the night when the kids were asleep, and spend your days at the park or taking the Boy Scout troop on hikes or playing golf. You could get up at 4 a.m. and work for several hours in the pre-dawn darkness before your family awakes and fills the house with noise and activity. You could work whenever, however, and wherever you chose, because the only one answering for your habits would be you.
Obviously if you’re building a business, you must work. But the point is, you have the freedom and flexibility to determine how that work best fits into your life, and nobody to tell you otherwise.
Now, if you’ve accepted piles of VC money, it’s possible you’ve used some of that money to obtain office space. You’d better be in that office when your investors stop in to visit unannounced.
If you’ve accepted VC money, your investors will expect regular updates, and for you to be available during office hours to answer their questions and give them the information they need. You’d better answer the phone when it rings.
If you’ve accepted VC money, you probably have more presentations to give, to justify your investors’ continued faith in you. You have people to impress, and meetings to attend, and bosses to answer to. You’d better be there, to earn their money.
Work where you want
Steve McLeod of Barbary Software has seen 111 countries since starting Poker Copilot in 2008. He runs his successful software company entirely from “the road,” and shares this anecdote with me as an example of the kind of freedom most of us can only dream of, but that constitutes his everyday life as a bootstrapper:
My friend has free access to a yacht in the Mediterranean. He wanted to go sailing for a week in Croatia, exploring beautiful islands amongst crystal clear water. Many people were interested, but as my friend would only find out at the last minute which week he could use the boat, all the invited people had to decline. Except me. I have my own business I can run as I see fit. If I want to spend a week on a boat, doing just the bare amount of daily work needed from the boat’s cabin, I can, and I don’t need to seek any boss’s permission. So sail I did. We were informed two days beforehand that the boat was available, and all I needed to pay was the return flight from Barcelona, where I live, to Croatia, a share of the boat cleaning fee, and a share of the gas.
A VC is just The Man in a more stylish suit.
In contrast, what is the stereotype of the Silicon Valley entrepreneur, backed by millions of VC dollars? He’s working 80 hour weeks. He’s a workaholic.
Obviously these are extremes! Not every VC-funded entrepreneur works himself to death, and not every bootstrapper is a jet-setting world traveler who works 10 hour weeks. But the basic truth remains: when you work for yourself, and only yourself, you call the shots. When you owe somebody money, they have a say in how you spend your days.
As Steve McLeod told me,
When one takes money from investors, one is beholden to their expectations, and their reasonable demands to recoup their investment.
VCs have a goal, and your business is a means to their end. They invest their money not out of charity, nor out of some Willy Wonka dream of handing out Golden Tickets to the deserving few. They invest with a reasonable expectation of turning a profit. It’s now your job to make that happen.
[Tweet “VCs are not Willy Wonka, handing out Golden Tickets. They invest to turn a profit.”]
Imagine your father hands you the keys to a new car on your 16th birthday. Your own car! Bought and paid for! You can taste the freedom of the wide open road, and you’re ready to fly.
Imagine now that he hands you a list of weekly errands, and a copy of your younger siblings’ schedules. Your days fill up with soccer practice, ballet lessons, grocery shopping. Sure, it’s still your car. But you’ll use it the way your dad tells you to, or it won’t be yours for long. After all: He paid for it.
You already know VC money means you’re not in control of your company. But by extension, you’re also not in complete control of your life. You have a boss, and you’re working for the man, just like the rest of us. When you have to answer to somebody about how you’re using their money, a 10 hour workweek from a yacht in Croatia is probably not an option.
“I want to work for myself.”
By contrast, a bootstrapper gets to decide what kind of life to live. And that’s why when we think of the old-fashioned American Dream, the dream of “owning your own business,” of freedom and independence, of working for yourself and only yourself, we’re not thinking about the hotshot VC-funded startups we see in the news. No, what we’re really thinking of is a bootstrapper.
[Tweet “When we think of the American Dream…what we’re really thinking of is a #bootstrapper.”]
A Love Letter to Bootstrapping is a series exploring arguments in favor of bootstrapping your small business, all based on the idea that even if you CAN get funded, you might not want to. If you want to keep up and haven’t signed up for our newsletter yet, now might be a good time to do so. (Don’t forget, there’s a free ebook in it for you, as well.)
More in this series:
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