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4 Ways Bootstrapping Beats V.C. Money
By Kara Cutruzzula
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4 Ways Bootstrapping Beats V.C. Money

All money is good money, right? After all, who doesn’t want a little helping hand? It’s normal to seek outside investors or V.C. money. But one recent success story might make you think twice.

Ron Rudzin started his online mattress company Saatva in 2007 with $350,000 of his own money (granted, that’s a sizable sum!). Without accepting windfalls from investors who wanted in on his future, Rudzin grew the company himself. Now  he’s projected to take in $180 million in sales this year — and he didn’t have to answer to anyone.

Here’s how bootstrapping changes your focus.

You’re more meticulous.

Rudzin told the New York Times that people who raise money always spend more money, because it’s not their own.

You keep all the profits.

That early boost might look nice in the beginning, but as you get more successful, you might start to resent sharing the profits with someone else.

No one will kick you out.

Because you don’t have to answer to investors, you’re not in danger of being out of a job.

You don’t have to answer to a thousand masters.

Sure, you might miss out on some valuable insight, but you’re also able to choose whose advice you want to take.

All money may be good money. But money you don’t have to share is even better.

photo: iStock

TAGS: Venture CapitalistsFunding


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