One of the few things I am taking from ESADE is the concept of bootstrapping. As I was working on two entrepreneurial ideas, I swept into this magic world of no external funding and low costs. A start up, that is bootstrapping, is basically sustaining itself on the basis of positive cash flow. To have a better idea of how this can work in the online world, you can have a look on video from David Heinemeier Hansson (37 Signals, Ruby on Rails, book Rework – recomendable). In his speech, everything seems really simple as he puts it that way. And I think his way makes a lot of sense.
Recently I´ve been shown the difference between a novice and an experienced entrepreneur. Between those two approaches, try to find five diferences:
Novice entrepreneurs primarily look for:
- how novel the idea is
- extent to which the idea is based on new technology
- potential to change the industry
- superiority of the offering
- intuition and gut feel
Experienced entrepreneurs are in the search of:
- solving customer´s problems
- speed of revenue generation
- ability to generate positive cash-flow
- manageable risk
- others in the network whom to develop the venture with
You´ve got them? And now guess what … surprise, surprise … David is just trying to show all the other entrepreneurs that starting a business doesn´t mean you need to be a genius! His simple three step start up is:
- Having a nice application/solving customers´ problem a little bit better then all the other guys / treating clients nicely
- Asking money for that
- Being profitable / becoming a million dolar company
There´s basically no need for taking the big waves, developing the next Facebook. It is all about simple ideas! Solving problems! And a positive cash flow …
Klara writes 