This article was written by Tom Ewer, a regular contributor for MyWifeQuitHerJob.com!
I love the concept of bootstrapping.
The idea of beginning with literally nothing and building it up stage by stage fascinates me. After all, money is a great facilitator, but we don’t all have thousands of dollars to invest in a business up front (and even if we did, we might not want to risk it). Being able to turn nothing into something is a very attractive prospect.
That is why I always preach the KISS principle (Keep It Simple, Stupid) to any would-be online entrepreneur.
The internet offers so many bootstrapping opportunities that it almost seems foolish for the majority of us to try anything else.
With that in mind, today I want to explore what I consider to be the five key principles of creating and growing your own successful online bootstrapped business.
1. Start Simple
Too many online business owners feel that they must start with a finished product. However, there are two immediate problems with that approach:
- Creating a finished product will probably take a great deal of time and financial investment.
- You don’t know if the finished product is what people actually want.
Editor’s Note: I started selling my Create A Profitable Online Store Course before I had any video content at all. People bought from me on faith that I would deliver.
Once upon a time, business owners had to take a leap of faith when releasing a new product or service. They would do market research, invest a whole load of money up front, then release a product to market and cross their fingers. Such events were often make or break scenarios.
That no longer has to be the case. The Internet allows business owners to release incremental iterations of their products or services on a small scale. It allows entrepreneurs to use the market as a testing ground.
2. Customers First, Product Second
The most important commodity to any business is its customer base. You could have the best product in the world, but its quality is irrelevant if no one is aware of it.
If you have an engaged customer base, everything else in your business can follow suit. Therefore, growing a large pool of potential customers should be by far your most important priority.
A modest example of this principle in action is a new blog I recently launched. Phase one of my plan is defined by three goals:
- Publish an enormous amount of free content
- Expose the blog to as many people as possible
- Grow my email subscriber base
Actually making money from it doesn’t come into the picture, because if I gather a big enough following, the making money part will almost take care of itself.
3. Let the Market Tell You What it Wants
Creating a fantastic product or service becomes much easier when you have an established customer base that will tell you what they want.
If you invest all of your upfront energy in developing a product, then go looking for customers, you’re exposing yourself to a great deal of risk. What if there is no market for your product? What if there is a market, but they don’t like your product?
If on the other hand you concentrate on growing your potential customer base, you can leverage it to find out exactly what you need to produce.
This is what I did when I decided that I wanted to publish an eBook. I had a few ideas as to what I wanted to write about, but the decision regarding the topic was essentially made by my blog’s readers. I had a good idea of what they were struggling with, and what they were (and are) looking to achieve. So, I tailored the topic of my eBook so that it offered a convergence point between (a) what I can deliver, and (b) what they want.
4. Do Not Submit to Financial Pressures
The worst thing a young business can do is make decisions based upon financial pressure. If your business simply must make money in the short term, you are likely to engage in far too much compromise.
A business led by short term financial priorities will ignore all of the above principles. Cash-strapped entrepreneurs will release a “finished” product to an underdeveloped customer base, in the hope that they strike gold. Every now and then that will happen, but for the most part, their rush to bring something to market will result in an underwhelming response.
If you are going to launch an online business, you should have a financial safety net that is large enough to support gradual growth. This was where I found myself after I quit my own job and launched my freelance writing business at the beginning of this year. I didn’t compromise the direction of my business because of financial pressure — I had a big enough safety net to allow me to pick and choose my clients, whilst also leaving plenty of time to work on my other projects.
5. Expand Cautiously
Reaching a point at which your business is breaking even is a great milestone, but any ambitious entrepreneur recognizes that as just the first step. Moving steadily towards and reaching that first stage of success is an admirable achievement, but you shouldn’t take it is a cue to break into a sprint.
At that stage, your approach to your business should not alter — the same principles still apply. Any expansion efforts you explore should be considered carefully, and you must be careful not to over-extend yourself in a fit of enthusiasm and misguided confidence.
This was something that I kept in mind when I decided to monetize my blog several months ago. I had built up a good-sized audience, but I had not yet made a penny from the blog. My initial monetization efforts were so small as to be practically imperceptible, as I did not want to damage the hard-earned trust I had built up with my readership.
I adopted the attitude that a modest affiliate income that I could gradually tweak over time was a more favorable outcome than a gung-ho attitude which could lead to the destruction of my reputation.
Steady Wins the Race
It may not seem particularly dynamic or exciting, but I believe that bootstrapped companies must work steadily towards their goals. I avoid the use of the word “slowly” deliberately, because there is no reason why your steady progress cannot be fast. It is less an issue of speed, and more an issue of getting ahead of yourself.
So remember — customers come first, then the “perfect” product, then steady expansion. That is the formula for a successful bootstrapped business.
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