When you’re starting a new business, the first thing everyone tells you is that you’ll need a lot of money. This is not necessarily true.
Personally, yes – unless you want to live on ramen, you’ll need at least a year of savings. If you have a family and a mortgage, then prepare for considerable stress as you bootstrap your way to success. But for your business, money is not as important as most people say.
After placing in the NextBC Top 5 Innovative Digital Media Companies, I’ve been reflecting on how we managed to take Tradable Bits so far, so fast, all without funding. To all my fellow startup founders – here are my hindsight-20-20 tips on how to build a startup without investors.
1) Just start doing
You don’t need money, you don’t need investors, you just need a really good idea. Do your research, chat with some friends, refine your idea and then start doing. Put that idea into action. Build it, prototype it, program it. You’ll never know if you can run a business on your idea unless you give it legs. Dmitry and I worked as consultants for six months, and would meet once or twice a week to work on our idea.
2) Find the right partner
Find someone who is smarter than you. Look for someone very different than you, that you can still work with well. Your personalities and skills must complement each other. Find someone equally as passionate as you, but who is willing to listen. If you learn how to fight out conflicts, you’ll ensure you’re always in the same boat, rowing in the same direction.
3) Use your network
You don’t need to ask your friends and family for money to gain their support. Maybe your friend knows of somewhere you can host for free. Maybe your brother can introduce you to a prospective client so you can chat about your value proposition. Take advantage of the contacts, resources and insight embedded in your networks – not their money.
4) Prove concepts by rolling out
Freemium is great, even for B2B. When you have no marketing budget, you must grow organically. The best way to do this is to give something away for free! Build sharing functionality into your products, and link every freemium tool back to your website. Just know that spreading awareness naturally won’t take days or weeks – it’ll take months or even years.
5) Constantly adapt and improve
Every client you bring on will have ideas and requests. Don’t silo these improvements into only their contract – add them to your overall technology. When you’re working with partners that share your vision, improving the product for them helps you become better. Much of our roadmap and ideas for our platform came from conversations with our first clients.
6) Don’t be afraid of Goliath
Building a startup gives most people an inferiority complex. Don’t be afraid to approach big clients. Everyone needs innovation – even Fortune 500 companies. If the timing is right, approaching a large enterprise can give you an excellent partner in the industry. Even if they don’t buy your solution, if they are willing to introduce you to someone else, you gain instant acceptance. Ask your friends for introductions. Go to events – we met the Canucks at a Facebook meet up. Find your champion and be forever grateful to them.
7) Gradually, carefully hire
Do not hire hordes of people in one batch. Expanding your team is your key to growth, but every person will add their own colour to the company culture. Carefully ensure that culture stays true to the founders. Look for go-getters; independent people who already have pet projects on the go. Even if they own their own startup, that’s good! It shows they’re willing to work in that environment. Many of our first hires came out of coop programs – university grads are great because they’re passionate and you get to try each other out for four-month periods. Just keep an eye out for multifaceted, quality candidates who have both the skills and the personality.
8) Go with in-house
Don’t contract a part-time designer. Don’t outsource your development. It’s better to hire a few people you really believe in than waste your time and money with one-offs. People who are employed by your company have a vested interest in its success, and will go the extra mile. Consistency is also essential when you’re developing a product, and every designer and programmer will have their own style. Find one you like, and do everything you can to make them yours!
9) Remember PR
Sometimes you get so busy building things that you forget to tell anyone about it! Talk about your ideas to friends, at events and do your best to get press. Marketing doesn’t have to cost gobs of money – if you have a newsworthy idea, find a journalist who covers similar topics and pitch an exclusive story just to them. Promoting your company doesn’t have to be expensive, but it does take time. Trust me – it’s worth the effort!
10) Don’t be afraid to kill failed ideas
The hardest thing to do as a startup is bury a project that’s just not working. Sometimes you dedicate months to a project, but it simply falls flat. It may seem expensive, but it’ll save you in the long run if you just let it go. Just make sure you learn from it, and apply as many pieces as possible to your newer, better idea.
After a year of hard work, careful hires and fine-tuning your product, if you’re lucky you’ll start making money! Once you’ve become profitable, then you can start looking for investors so you can rapidly grow. But now that you’re stable, you’ll be in a much better position because you get to choose because it’s right, not because you’re desperate. But beware – as I’m learning quickly in my own search for the perfect investor – finding the right funding time consuming! I’ll be sure to let you know how it all turns out.