Having a VC Mindset as a Bootstrapper
James M. Benham
Bootstrapped InsurTech CEO & Co-Founder @ JBKnowledge & Terra. Co-Founder of SmartBid (exited). Bestselling Author "Be Your Own VC". InsurTech Geek Podcast Host. Regent @ Texas Southern University. YPO.
The line between being a traditional bootstrapper and a VC is starting to become?increasingly blurry. The difference is that as a bootstrapper, you tend to be out of the spotlight. You don’t get a lot of press as a private entrepreneur because you are?focused on generating cash on your own and building a business in a long, slow, painful way.
The reality is that no matter how you start your business, there’s a much higher failure rate than people care to admit. To be a VC, you need to think strategically and always keep an eye out for new opportunities. A bootstrapper’s mentality should be no different.
Some founders have an out-of-control mindset: “We’re going to raise 50 million dollars and we’re going to spend all of it in 18 months.” When they inevitably pivot their business model, they’ve already run out of cash, and they go out of business.
By bootstrapping your business while keeping a VC mindset, you can make smarter decisions, inevitably making money last longer and scaling your company to long-term success.
When diving deep, I noticed that bootstrappers and VCs tend to?have these 3 things in common:
1. A willingness to be flexible and ability?to?adapt:
No matter what industry you are in, change is always on the horizon. Continuing to learn, stay?informed, and adjust?to the market is critical to a founder’s success.
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2. A willingness to educate themselves on scalability:
A VC or bootstrapper?needs to think about building what they?have to build, in order to build what they?want to build. Sometimes they?can’t always start off doing exactly what they?have in mind, they?need to generate?cash first.
3. A clear vision for their?future:
I have 5, 10, and 20-year goals for my company and myself. Forward-thinking enables bootstrappers?to make decisions that align with their main goals when situations arise.
At the end of the day, trusting your gut and thinking like a VC are what made my business’ successful. To learn more about how to push through and generate cash to survive, check out my book “Be Your Own VC,” available on Amazon.
Important Question to Ask Yourself This Week:
How can I implement the VC mindset into my bootstrapped business?