As a student without much financial resource to start a business with big bucks invested, Chris Guillebeau’s The $100 Startup presented a possibility to “bootstrap” a business – an entrepreneur that starts a company with little capital – with the goal to increase efficiency and productivity by moving quickly. Through 10 years of experience on a quest of visiting 193 countries to meet with entrepreneurs and seek to understand how they’ve built successful projects, Chris found “unexpected entrepreneurs” – those without a formal business education nor tons of college debt – to be the most interesting and particularly good at bootstrapping, which he then included several ways to make bootstrapping successful.
Chris’ mention of having convergence – the overlapping point of passion and value to offer to society. Moreover, Chris gave me a new perspective on how failure is overrated. You can fail multiple times and expect to fail multiple times in a business setting. However, by bootstrapping, you can fail without being crippled financially; rather embrace the failures as a way to grow fast and stand-up fast – setbacks are setups for your comebacks.
- Find your passion
- Which leads you to become good (eventually great) at it
- Do when there’s a demand for it
- Fail many times, and either adjusts to a new approach to that demand or find the right demand
The intersection of these two points is the right choice in pursuing a career or in starting a business.
Another big idea Chris introduced that is strategically practical for me to implement in a business is the idea to “invest in winners”. The concept in “invest in winners” is that only by seeing the initial success of a business, should you invest more money and energy to it. I relate this concept to the Pareto’s Principle (80/20 Principle), in which pick the 20% of what you do as a business as it will likely to yield 80% of growth and dump the rest 80% to refrain from further loss of time and capital. In the grand scheme of things, I see that happen often in investors for Series B and C especially. As they want to achieve the most efficient result by investing companies that are already successful initially by reducing risks. However, something I disagree with is, often times, demand is hidden and needs to be exploited. People might not even know they need the product/service before it exists, such as the iPhone. So just because a company doesn’t initially succeed due to slow market response to its products/services, doesn’t mean the business should be given up quickly; that is from an entrepreneur’s standpoint especially what you are doing has a big impact and is potentially revolutionary. Although, I do agree that from especially an investor’s standpoint, “invest in winners” is the best way possible, statistically speaking.
Moreover, Chris mentions another characteristic of bootstrapping which is valuing organic growth over the traditional advertisements. I agree with him on this because by building a good relationship with customers (developing great products/services), the business can eventually be spread by the word of mouth. Although this process may yield slower growth, it is far more sustainable and can potentially build a reputable brand, not just a business. A good example is the cell-phone company OnePlus. Its ideas of building a stellar phone with top-notch specs paired with half the cost of a high-end phone, and its initial marketing strategy of hunger marketing (limiting the number of phones they sell to create a perception of scarcity and higher demand), they were able to quickly capture market attention. One of the major reason behind it (half the cost of the high-end phones) was by not promoting their products at all through advertisement, rather by the word of mouth.
Overall, with the arrival of the information era, we are at the convergence of a microbusiness revolution. Anything we are resourceful at – human or nonhuman – there are lots of demand out there to turn it into a business since we are still at the early age of this new era. Furthermore, according to historical trends, anytime when society has a major change, such as the Industrial Revolutions and the World Wars, there are possibilities to turn the unknown or even crisis into opportunities, by seeing the trend early on and embracing it with an open-mind and forward-thinking attitude. Something I would ask him is, what’s the most important/reoccurring characteristic of those entrepreneurs he has met? And what is his thought on Angelina Duckworth’s emphasis on having grit and a growth-mindset from his own experience?