Important Bootstrapping Techniques to
Minimize the Need for Capital:
Buy used equipment instead of new
Borrow equipment from other
businesses for short-term projects
Use interest on overdue payments
Hire personnel for shorter periods
instead of employing permanently
Coordinate purchases with other
businesses (mutual purchasing of goods)
Lease equipment instead of buying
Use routines to speed up invoicing
Cease business relations with
customers who frequently pay late
Offer same conditions to all
customers (that is, no expense on preferential treatment to some)
Buy on consignment from suppliers
Obtain trade credit from suppliers
Deliberately choose customers who
Share business premises with
Employ relatives or friends at
Run the business completely from
Financing: Key Documents
One of the least used methods to
minimize the need for capital is constant sharing of equipment and employees
with other local businesses to reduce fixed commitments.
Finance: The Art of Start-ups" by Bhide, A.
2. "Who Bankrolls
Software Entrepreneurs" by Freear, J., Sohl.J.E., and Wetzel, W.E.
Bootstrapping in Small Businesses: A Resource-Based View on Small Business
Finance", Winborg,J., and Landstrom.H.
Investing", Osnabrugge,M.V., and Robinson, R.J.,