What is Bootstrapping?
Bootstrapping is the act of starting and growing a company using only your personal resources and the revenue generated by the business itself. There are no Angel investors, no VCs, and no massive funding rounds. You are pulling yourself up "by your own bootstraps."
The Philosophy: Customer is King When you raise VC money, you technically have two bosses: your customers and your investors. Bootstrappers answer only to their customers.
- Control: You retain 100% decision-making power. No board meetings, no pressure to "grow at all costs."
- Equity: You own 100% of the company. A £5 million exit for a bootstrapper is often more life-changing than a £50 million exit for a diluted VC-backed founder.
The Challenges Bootstrapping is not for the faint of heart.
- Speed: Growth is constrained by cash flow. You can’t hire ahead of the curve.
- Risk: If the company fails, it’s your personal savings on the line, not a fund’s money.
- Resources: You have to wear every hat—sales, marketing, product, and support.
The UK Context: The Bootstrapper’s Lifeline For UK bootstrappers, R&D Tax Credits are a critical tool. If you are building innovative tech, HMRC may refund up to 18-27% of your development costs (even if you aren't profitable yet). This yearly cash injection often acts as "non-dilutive funding" that keeps bootstrapped teams alive.
Key Takeaway: Bootstrapping is the path of maximum freedom and maximum personal risk. You trade speed for control and equity.
