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think big, start small

3 Reasons You Need Bootstrapping For Your Startup

All startups need to learn that in order to have a success business, they need to dream BIG but start small. I have seen many businesses that have started BIG but find themselves struggling to sustain itself and hence they close down. Here are some of the reasons why you should start small.

Reason #1 – Avoid the Temptation of Getting a Large Office

I know some entrepreneurs would like to show off to people that they are running a successful business by spending unwisely on luxury items. What you don’t know is that you are putting your business at risks. You need to consider that your business is still young and needs to be able to sustain itself. The first 3 years of running a business is crucial. According to statistics, 80% of startups fail within 3 years, so don’t expose your business to be part of that statistics.

Start today by sharing an office space with someone. This will save you a lot of money on rent especially on days when your sales go down. If you can do your business from home, then that would be the best starting point. You won’t have to stress over rent arrears and you will lower your overhead giving you the best chance of surviving in the first 3 years of operation.

See Also: What You Need To Know About Bootstrapping

Reason #2 – Write a Budget & Keep to it 

Before you start a business, you need to write a budget. This should be in your financial plan when creating a business plan. You need to access what assets you already have in your possession. If you already have a mobile phone and a computer then you can start with that from your home. Limit your spending based on your income that you are receiving from your business. I usually make sure that 60% of business profit is injected back into the business for growth and the remaining 40% of profit is what I can afford to use for anything I want.

Remember, spend wisely only where necessary. Don’t spend on anything that takes your money out of your pocket. For example, don’t buy a car because it is a liability. It will cost you more money to maintain it. Only buy a car if it is bringing you more money into your pocket.

Reason #3 – Avoid Quitting Your Job For Quick Money In Business

If you are still in employment, then you don’t need to quit just yet. You can start your business on a part-time basis. What many people don’t know is that, it takes time for the business to generate sustainable income that will take care of the business operations at the same time take care of the entrepreneuer. So don’t rush to business because you want to make quick money in the short term, you will be hit with a reality that you won’t like.

My advice for those who are still working, make sure that your business is earning at least 50-60% of your salary consistently before you decide to quit your job.

Here is to your Success in Dreaming BIG but starting small!

Photo Courtesy of kevinelworthlive.com

About Enock Kiprono

Enock Kiprono is the founder of Fenesi.com & Dealpoa.com. He loves to connect with entrepreneurs that are success driven, passionate, action-taking whose goal is to make a difference in the business world!

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