UlTImATE SUccESS GUIdEThe best and usually the only way to start your own small business is for
you to accumulate the money that you need personally. You will have
to use your savings, loans against your home, and money from your
friends and family. When I started my first business many years ago, I
learned how to sell again. I sold my house, my car, my furniture and all
my investments. This is quite common.
Plan to grow your business by bootstrapping, one of the most popular
and powerful routes to entrepreneurial success. In bootstrapping, you
pull yourself up with your own efforts. You start small and you grow
on a solid foundation of sales and profits. This takes longer than if you
were to start off with money in the bank, but it has one distinct advan-
tage. Bootstrapping forces you to develop the knowledge and skills you
need to be successful as you go along. Because you do not have money
to throw at your problems, bootstrapping forces you to become more
creative in generating sales and profits. You learn early on to rely on
yourself and your own abilities to succeed. Your skills develop as your
business grows. You learn strategies and techniques of business success
that last you all your life.
Many of the biggest businesses in America started on a hope and prayer,
and the strategy of bootstrapping, on the part of an under-funded entre-
preneur. Some examples are Ford Motor Company, Hewlett-Packard,
Microsoft, Apple and even McDonalds. What thousands of successful
businesses have done, you can do as well.
Be ReAlIstIC When YoU stARtWhen you begin your business, you must practice the “two times, three
times rule.” This rule says that, no matter how conservative your financial
projections, everything will end up costing you twice as much as you have
budgeted and everything you need to do will take three times as long.
For example, if you think that it will cost you $1,000 to develop a prod-
uct and bring it to the market, it will invariably cost $2,000 or more.
Some start-ups actually end up paying ten times what they had planned
to get the first product out the door. If you think that it will take you
three months to break even once you have started, you should triple
that number and calculate that it will take you at least nine months. I
have worked with companies that have taken three years instead of three
months to get their first product to the market.