Starting a business is exhilarating. It’s your chance to develop something that’s entirely yours, and take it from a sketchy idea into a thriving, growing entity that creates profit and gives you the lifestyle you want.
Of course, that’s the long-term plan. First though, you have to build it. And if you want to do it off your own back, with no (or as little) outside financial support as necessary, you’ll need to bootstrap your startup business.
Going lean might seem unappealing. But it’s perfectly normal for the millions of businesses that start each year around the world.
There are plenty of ways to cut back without hurting your fledgling enterprise. Here, we’ll take a look at some of the most common ways to grow your startup while saving money.
Streamline tasks with the help of free apps and tools.
Saving on little things goes a long way, and there are tons of free apps and tools out there to help you get the job done. Sure, eventually you’ll outgrow the free version, but for now it gives you the service you need without the cost commitment.
You can find free services for all sorts of different services like Dropbox for online storage and Mailchimp for email campaigns. Writing for Fundera, editor and financial advice specialist Meredith Wood says:
“When trying to discover how to grow your small business on a budget, limited staff and lower cost are both requirements.” Wood offers some examples of useful apps and softwares that can help you do more with less:
- Hootsuite for social media scheduling
- QuickBooks for small business accounting
- Trello for project management and workflows
- TurboTax for fiscal year end tax accounting
- When I Work for shift-worker scheduling
- Zapier to connect various softwares and create automated processes
Do you really need it?
Before any significant purchase or investment, ask yourself, do you really need it? Discipline yourself. Don’t fall into the ‘shiny new object’ trap. Will it help your business and your end users? If the answer is ‘no’, then shelve it for another day. There’s a time and a place for everything, and this may not be it.
Pass on expensive office space.
That fancy downtown corner office with the awesome views? It’s one of those ‘shiny things’. Leave it for another day. In the meantime, work remotely and use a virtual office, which gives you a business address and takes care of all your mail receiving and forwarding. A virtual office is a service run from a physical office building, which also has on-site meeting rooms and offices you can rent by the hour. So you can still use that fancy downtown office from time to time — but you won’t need to burn through your cash reserves to do so.
Outsource to trusted professionals.
It’s a useful idea to take a long, hard look at the repetitive tasks you do on a day-to-day basis. You can take care of some of them, like accounting, with the help of a free app (see list above). However, others will require human help.
For specific projects, such as a new website or an email campaign, consider hiring a freelancer through a jobs platform like People Per Hour, Upwork, or Freelancer. Post your requirements and invite bids — but don’t just go for the cheapest option. Ensure the person you choose has the experience, and if necessary the qualifications, to see your job through to a high standard. Otherwise not only will it fail to meet your needs and support your business growth, you’ll also pay to have it done again further down the line.
You might not realize it, but one task you can outsource is customer service. Through a remote live receptionist service, your incoming calls will be answered daily (through the working week) by a customer service professional, which not only improves your callers’ initial impression of your company, it also helps with essential requirements such as client inquiries and lead capture. What’s more, live receptionist professionals can do much more than handle calls; the service often includes appointment scheduling and bookings, too.
However, don’t outsource every job that you can do yourself.
There’s a fine line between outsourcing work in favor of recouping that time for other important jobs, and doing some of that work yourself. In an interview with Fast Company, Rodrigo Santibanez, cofounder at EAT Club, says:
“When bootstrapping, hiring out for a job you could do yourself is an avoidable expense and a wasted organizational learning experience. For example, I delivered lunches myself for three months before hiring our first driver. This saved us $1,200, which may not sound like a lot, but it was actually 12% of our capital.”
Referrals, reviews and testimonials.
Marketing is invaluable for every business, especially bootstrapping startups. And one of the best ways to bring in new leads and to increase brand awareness is through good old fashioned word of mouth advertising.
Referrals, in their many different forms, are a form of compliment for a business. And it’s usually free, too (unless you operate a paid referral system). But you must remember to ask for them! If customers are happy with your product or service, don’t just settle for a friendly ‘thank you’ over the phone. Ask your client to pen a few words saying what they think of your service and most importantly, how it helped them.
With your clients’ permission, you can collect and publish reviews in numerous places — on your website, on your blog (perhaps with a video testimonial to accompany it), in marketing material, and on third party platforms like Yelp or Trustpilot. One of the most important places to collect reviews is Google My Business. Anytime your business appears in search results, you have the opportunity to display a high star rating alongside public feedback. It’s a great way to grab attention but it’s also incredibly important for SEO.
Google reviews is also a public two-way conversation. So if a customer’s experience falls below expectations, and their review reflects that, you will have the opportunity to reply and show the world how you resolve the issue.
Also keep in mind that Google My Business is free. That’s a pretty powerful marketing and customer service tool.
Finally, if something isn’t working, know when to cut your losses.
In an interview with Foundr, Laura Roeder, Founder and CEO of MeetEdgar, offered some helpful words of wisdom for fellow bootstrapping business owners: “Repeating your mistakes can be pretty costly for a bootstrapped business.
“Know when to cut your losses. Identify things that don’t work, and find alternatives. Even when your bootstrapped business is established and off the ground, the costs of making the same mistakes over and over can add up fast!”