Bootstrapping and

Bootstrapping and

Extreme Bootstrapping

How to Become a Millionaire

Most millionaires in the United States are people that started their own small private business. These millionaires outnumber those who inherit their wealth as well as highly-paid professionals such as doctors and lawyers. They far outnumber those who start they own business and succeed by raising venture capital and cashing out with a successful IPO.

How do these people succeed without venture capital? Primarily they do it by bootstrapping: They cut business and personal expenses to the bone. They reinvest all they can afford into growing the business. They work hard. They persevere. They spend as long as it takes to reach their goals.

Although the vast majority of successful small businesses get along without venture capital, most high-tech entrepreneur act as if raising venture capital is the only way to proceed. However, consider the example of Dragon Systems, Inc.

Starting with about $30,000 initial investment, Dragon bootstrapped for 12 years while speech recognition technology matured and personal computers became more powerful. By the time of its first outside investment, Dragon had already grown to over $10 million in annual revenue and a market valuation of $80 million. Although Dragon later fell victim to being acquired by a company that went bankrupt, Dragon bootstrapping effort was highly successful.

Extreme Bootstrapping

Extreme Bootstrapping starts with the principles of bootstrapping and, well, takes them to the extreme. In Extreme Bootstrapping, the founders don't even pay themselves salaries until there is revenue to cover it. They do whatever is necessary so that the business spends less than it makes.

They keep their regular job. They live off their spouse's income. They borrow from friends and family. They cut their expenses. They do whatever.

Thay are passionate about their work and they love what they are doing.

When the company starts making money, they still don't pay themselves full salaries. They put all the money they can back into the business. They keep the business expenses low, but they spend on the business before they spend on themselves.

They persevere. They succeed.

The Extreme Entrepreneurship course teaches these principles for bootstrap start-ups and many more techniques to help a company grow from start-up to IPO and beyond.