7 Successful Bootstrapped Startups
What is a bootstrapped startup? And who has successfully bootstrapped their startup?
Firstly, what is a bootstrapped business?
Bootstrapping is the process of starting and running a company with little to no outside funding.
It's where a company is usually started through either: personal savings, credit cards, and loans from friends and family.
This term originates from the saying “pull yourself up by bootstraps.” The phrase has been mentioned throughout history in a many books with the sentiment that it’s a sign of a self-starter who needs to use what current resources are available to keep moving.
Bootstrapped founders are sometimes forced to be more creative and resourceful.
Bootstrapping founders have limited resources which forces them to have a clear focus on building a business with revenue and profits - while also closely watching expenses.
However, bootstrapping can be an advantage, as bootstrapped companies are independent. They are not beholden to outside investors and can therefore make decisions based on what is best for the company, rather than what will please investors.
It’s acknowledged that bootstrapping can be a really hard journey for founders but there are benefits to remaining independent. Learn more about the pros and cons of different types of startup funding.
Below are seven successful bootstrapped businesses that have made a big impact.
7 bootstrapped startups
Meet Edgar
2014, Laura Roeder
MeetEdgar is a social media management tool that helps businesses automate their social media posting.
Roeder bootstrapped the company with $50,000 of her own savings from previous businesses. She has since grown the company to over $12 million in annual revenue. In a discussion from Business of Software Conference Europe, Laura explains some of the advantages with examples from MeetEdgar.
“The math of being bootstrapped means that you and your co-founders own probably all the business right and then that gets really lucrative as it becomes larger and it becomes profitable. And you have an asset you can sell.“ In an interview with Business Insider, Roeder said that she decided to bootstrap the company because she wanted to retain control of the business. She also said that she didn't want to give up equity in the company or take on debt.
Ghost
2013, Hannah Wolfe and John O'Nolan
Ghost is a powerful and simple publishing platform that enables people to easily create and manage their own online publications.
“We're still an independent, self-funded nonprofit organization that can never be bought or sold. And, everything we do is still decentralized and open source. Can't count how many people said ‘that will never work’ - but we're still here. Each year there seems to be a new hype-cycle competitor that pays wild sums of money to get people to use their product, tries to centralize creators under a proprietary iOS app, and convince everyone that their "network" is going to solve everything – but each year we stick to the same thing we've always stuck to: Just quietly making a better product.” - John said.
Myles Cars
2013, Sakashi Vij
Myles Cars is a self-drive mobility service in India, completely self-funded by the founder Sakashi Vij. In an article for Entrepreneur.com, Vij shared some crucial points about the importance of bootstrapping.
"In my view and experience, bootstrapping enables brands to work towards sustainable growth. The focus on the lifetime value of a customer is far more significant because of resource limitations. At Myles, we are trying to bring together a change in the way people use cars. Therefore the long-term change in customer behavior is important for us." - Sakashi Vij
According to her, brands can pursue sustainable growth by bootstrapping, and the emphasis on a customer's lifetime value is far more important.
Basecamp
1999, Jason Fried, Carlos Segura, David Heinemeier Hansson, and Ernest Kim
Basecamp is a simple project management platform build by 37 Signals.
With tens of millions in revenue and consistent single digit percentage in revenue, Basecamp have bootstrapped well and are known for their “no-nonesense strategy”.
Pinkcolada
Ana Gavia
Pinkcolada offers stylish and affordable swimwear.
Ana Gavia is the founder of Pinkcolada, a brand that sells stylish and affordable swimwear. She started the company at 25 years old while taking up Medicine in Australia. As a self-funded entrepreneur, she started with only 200 dollars and eventually, grew into a multimillion-dollar company. In a Forbes interview, she shares some useful advice for entrepreneurs who are putting money into starting out a business.
“I probably worked for free for a while… At the same time, I found that it was important for people to get to know the brand and get that brand out there somehow.” - Ana Gavia
Create & Cultivate
Create & Cultivate is an online platform for women who want to start and grow the career of their dreams.
Jaclyn Johnson is a self-funded entrepreneur, CEO and Founder of Create & Cultivate. When she was turned down on multiple jobs she started her own company and managed to turn two companies from self-funded side projects into multi-million dollar businesses.
“There are pros and cons to being self-funded and pros and cons to being venture-backed, and I think a lot of women get hung up and obsessed on the idea that I need to raise millions of dollars for my company to be legitimate. But I don't think it's the right path for everyone.” - Jaclyn Johnson
Collabosaurus
2015, Jessica Ruhfus
Collabosaurus is a marketing tool that connects brands for clever collaborations and partnerships.
When partnerships are 25x less expensive than digital ads, Collabosaurus is serving the hundreds and thousands of businesses that use partnerships to extend their reach. With 100-150 new brands monthly on the platform, Jess has bootstrapped the business after a few major lessons in business. In an interview with Smart Company, Jess shared some of the costly lessons along the way including building apps, trying to raise capital, and what ended up working for them.
“Everything as a bootstrapped founder is inch-by-inch… We can’t take huge risks financially.” - Jessica Ruhfus
Want to learn more about startup funding? Read the pros and cons of different types of startup funding.
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