In a world of 7-figure seed rounds and 9-figure acquisitions, it can seem like growing your startup is impossible without significant capital. The companies that raise the most get tons of attention, and the companies that don’t are generally viewed with a questioning eye.
“There must be something wrong with their model if they haven’t raised capital!”
But here’s the reality: countless companies are getting customers and creating significant revenue without ever raising anything beyond what’s in their own wallet.
GoPro was started with $10,000 of the founder’s own money as he grew the business camera by camera out of his trunk. 37Signals is one of the most successful software companies of the past decade, and they notoriously preach the bootstrap gospel. GitHub was started as a side project, and never raised a round until four years into the business, using the capital for expansion, not creation. And these are just a tiny sample of the notable examples. Thousands of other startups are making a splash in their own right without ever pitching an angel or VC.
When I started Bodeefit in 2012, I started it with less than $100, thanks to a personal challenge from the classic book The $100 Startup. I had lost a significant amount of my own money on my previous startup, so bootstrapping Bodeefit sounded like a dream. Fast-forward a few years, and now Bodeefit has over 350,000 users, generates a moderate revenue with very little overhead, and delivers well over a million workouts per month. And I’ve still yet to hit my $100 bootstrap budget.
Below are a handful of methods I’ve used first-hand to grow my startup without raising any money.
Don’t Build an Audience. Tap into Existing Ones
Where does your target audience hang out on the internet? What sites do they visit? Where do they get their industry news? These are the people you want to seek out and get in front of.
Position yourself as a subject matter expert and become a contributor to these publications. When you contribute, you’re usually given a contributor bio and minor self-promotion, which can be enormous in terms of referral traffic driven to your site. Whether it’s Inc.com, Men’s Health, or a trade magazine, there are plenty of publications out there that need quality content. Editors of these publications are responsible for sourcing or creating the content for their publication, and if they don’t find it from outside contributors (like you) then they have to create it themselves. Lighten this load for them by offering yourself as an unpaid, regular contributor.
Here’s how to do it:
- Make a target list of publications. The list doesn’t have to be huge, especially if you execute well on the following steps. Even becoming a contributor to one or two of the larger publications can move the referral traffic needle in a big way for your company.
- Find the editors at each of these publications. Online publications always have a staff page, and editors’ contact information is usually listed here. If they don’t list it, find someone else’s email on the site and use the same email structure for the editor (i.e. firstname.lastname@example.org).
- Email the editor letting them know why you should be a contributor. Simply wanting to contribute isn’t nearly enough. They have to trust that you are a subject matter expert in your field and have valuable knowledge to share with their audience. Focus on your story. What makes you unique? What specific topics do you know better than anyone else? What knowledge do you have that can be extracted by their readers? Position yourself as the go-to person in these areas, so the editor knows they’re working with someone who knows what they’re talking about.
- Offer a pre-written piece so they can check out your writing style and see the value it could provide their readers. If you do this, be sure to mimic the other articles on their site. If they average 400-500 words per article, submitting a 2,000 word article will probably annoy the editor, and you’ll come off as someone who hasn’t done their research. If you don’t want to write a full article, you need to at least pitch the editor a few possible pieces that you think would be valuable to their readers.
- In your outreach, touch on an editor’s pain points. Editors want contributors that don’t provide junky, unedited content. This means you should edit the article at minimum a couple times yourself before sending it to them. Make sure to get a second pair of eyes to edit it, too. The less work they have to do in the editing process, the more valuable you’ll position yourself as a contributor. Editors want contributors that are dependable, so let them know that you can contribute on a regular basis, ideally weekly or every other week. They have content calendars to stick to, and having an irregular or undependable contributor can be an enormous pain for them. Make it clear that they can expect quality, pre-edited content from you on a regular basis.
- Follow up. A lot. Editors, like all of us, are busy people. Onboarding a new contributor is rarely top-of-mind for them. You have to stay in front of them to push yourself over the line from “possible contributor” to “active contributor.”
By using the methods above, I was able to become a contributor for extremely high-traffic publications like Men’s Journal, Men’s Fitness, Huffington Post, and Lifehacker.
You don’t build a website audience by winning visitors one by one. Tap into large, existing audiences to start getting the attention of potential customers.
Partner Above Your Weight Class
What are the companies that would make a huge impact on your business if you partnered together? These companies are often more willing to partner than you realize. The key is to:
- Offer them something of value for free. This can be work hours, content, development resources, anything. From the outside looking in, is there a pain point this company has that you could solve? Is there something the company is putting time or capital resources into that you could take off of their plate? Offer to do it for them.
- Exchange your hard work for visibility. Partnering with a larger company provides you with the one thing you need – an audience. Much like becoming a contributor for large publications, the goal in larger partnerships is to gain visibility where there previously was none.
Early on at Bodeefit, I noticed that Greatist, one of the largest health and fitness sites on the web, was creating daily workouts and posting them on their site. They were going out of their way to find different personal trainers every single month, and these trainers would provide them with workouts and pictures, which they then posted as their “Greatist Workout of the Day”. Given that Bodeefit already created daily workouts, and had beautiful, professional photography and videos to accompany them, I offered to take this task off of Greatist’s plate and load it onto ours. They were happy to hand off this task to Bodeefit in exchange for pushing a significant amount of traffic to us. That partnership has lasted almost a year and a half. To this day, Greatist is still the largest referral traffic source for Bodeefit.com.
One of the biggest challenges of of running a startup is simply getting noticed. But partnering above your weight class can help you get there. You may have to give up resources like time and talent, but the exchange is well worth it.
The One Thing Any Startup Can Do
Sell. And don’t stop selling. There are a lot of theories around when, why, and how you should sell, but my theory is that you should sell early, and sell always. Revenue is king when it comes to bootstrapped startups. Since you don’t have funding to float your company as you build, revenue has to be the driver. Whether it’s implementing an outbound sales process with your team or testing paid funnels like AdWords and Facebook, you don’t know if you’re building something valuable until someone gives you money for it.
Above all, don’t spend months or even years building something no one wants. The only way to avoid this is by offering a paid version of your product from the beginning, or as soon as you can, and using verbal feedback (“do this, don’t do that”), as well as nonverbal feedback (seeing both how and how often they use the product) to drive future product developments.
Raising capital is one way to grow your startup quickly, but it’s not the only way. Bootstrapping can allow you to save cash, retain your equity, and build without excessive risk. And truly creating something out of nothing is incredibly rewarding in the long run. Seeking outside capital certainly isn’t a bad thing, but it isn’t the only thing.
Do you know some great ways to grow your startup without raising money? Let me know on Twitter. I’d love to share them with the Galvanize community.