Bootstrap Financing Your Way to Business Success

Do you need to start or grow your business but have

little money? Before you look to banks and similar

sources of financing, why not bootstrap your way to

business success?

A bootstrap is a small loop of leather or other

material that is found on the top rear or sides of a

boot. The purpose of the bootstrap is to help you

pull your boot on.

In business, bootstrapping has come to mean helping

oneself without seeking outside help. It means using

your own resources to finance, promote, and develop

your business.

Here, then, are some ways of financing your own

business by using your own initiative and depending

less on outside bank financing.

1. Operate a Home-Based Business

Operating your business from home could save you a

fortune. First of all, you eliminate the costs of

expensive commercial rent, commuting, et cetera.

As well, your business use of home expenses would be

deductible for income tax purposes. Since your home

is your base of operations, your travel and automotive

expenses from your home to clients would be deductible.

2. Accept Credit Cards

Rather than financing receivables and assuming the risk

for bad debts, why not accept credit card payments?

For more information about accepting credit cards, visit:

3. Drop Ship Products

Rather than financing and stocking inventory yourself,

consider drop shipping.

With drop shipping, when you make a sale you contact

the manufacturer or authorized distributor who ships

the product to the customer with your invoice and

shipping label. Advantages include no warehousing,

shipping, or inventory costs.

For more information about drop shipping, visit

4. Use Your Customer`s Money

Selling memberships, subscriptions, gift certificates,

and coupon books are just a few ways of getting your

clients to pay upfront. Obtaining advance deposits

and retainers from your customers can help finance your

business operations and reduce or eliminate the need

for bank financing.

5. Licensing

Instead of trying to finance the manufacturing and

marketing of your invention, which could cost millions

of dollars before you have your first sale, why not license it

to a company with the necessary expertise and capital?

You will then receive royalties in return for your idea.

For more information about licensing, visit:


6. Other Bootstrap Financing Methods

Aggressively control costs, barter, get extended terms from

suppliers, establish strict credit and collection policies

and procedures, rent (or lease) instead of buying equipment,

buy used equipment instead of new, sell off excess inventory

and equipment, obtain free publicity instead of paying for

advertising, and do whatever else is necessary to generate

cashflow and profits.

In these ways and many others not listed here, you may be

able to start and grow your business successfully with very

limited capital. Thus, you will avoid having to obtain

expensive debt or equity financing.

Many who were unable to obtain financing from any other source

have successfully bootstrapped their way to business success.

For more information about financing your business,


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