Steve Murch knows a thing or two about building a startup without taking outside funding, as the founder and CEO of bootstrapped startup BigOven, a mobile grocery and recipe service with more than 7 million downloads and 1.6 million registered users.
A veteran of companies including VacationSpot, Escapia and Expedia, and a student of a certain “Saturday Night Live” sketch, Murch shared startup bootstrapping lessons at the recent Seattle 2.0 Startup Day, presented by GeekWire.
For anyone who missed the event, or wants to relive the highlights, we’re rolling out video and related content from talks by Startup Day speakers. Continue reading for a few of our favorite takeaways. A big thanks to the team at (appropriately enough) Bootstrapper Studios for their help on all of this content.
The benefit of control: Bootstrapping allows you to really have complete control over the culture decisions, the products, the employees that you choose to partner with, the partnerships that you make, the financing, the overall strategic direction of the company. You have, of course for as you can maintain that, zero dilution, which has an economic impact, to be sure, but it also has a pretty important control aspect.
The ability to focus on something other than raising money: It’s awfully nice to say, you know what, the trip to Sand Hill Road wasn’t necessary. Instead we rolled out a new feature that hundreds of thousands of customers have already used.
A different mentality: You really have far fewer resources, of course, because there’s less cash coming into the company. In almost every case, I think I’m slightly more conservative in certain decisions, because I’m like, well, I kind of want to manage this to break even this month — which by the way, I should say as an aside, is generally the way I’ve been running BigOven. I get pretty good visibility as to what the revenues are going to be like on a monthly basis, and I say, oh, we can add a new employee and that will basically keep us at the break-even level.
Key data point to watch: It really does come down to cash flow. You have to look at the pace of revenue growth and the pace of your expenses, and the anticipated bumps in the road that you might have. How quickly can you get to positive cash flow?
More cowbell! If you’re any kind of entrepreneur, you absolutely have to have the passion for what you do, and you have to iterate. In that cowbell sketch, you saw legendary producer Bruce Dickinson come in time after time and say, “It’s not quite good enough! We need more cowbell,” and you should be doing that, too, with yourself and with the team.
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