Lesser Funding from MOSTI – Bad News for Technopreneur for the Year of Tiger
BOOTSTRAP OR DIE. Its time to tighten your belts Technopreneurs, funds are limited for the year 2010. According to source theStar inTech, 2010 Budget for Grant has been cut by RM 1 Billion, leaving RM 2.7 Bil to be handed to deserving applicants. The worst news for my company, is that the eContent fund has been dry out, where animation companies like us are most needed with such fund for content development. However, surprisingly I am not feeling sad nor depress with such news. The reasons is because I have shifted my mindset previously on reducing the dependency on government grants. Apart from that, we are in discussion with broadcasters, although the response is slow, but we had a good feeling that there will be projects coming in this year after Chinese New Year.
So, Start-ups, in such tough times what will you do to prevent from extinction?
- Pre-Sales works for all sectors – You need not have a perfect end product to sell. Take a home delivery service offering gourmet meals as an example. A bootstrapper will not waste a cent on making meals that nobody wants, instead, he/she will first compile an interesting menu, then goes into the market to get their interest and get orders first with just only the well presented menu. Another word, sell your ideas in the air, get the money, and developed. the upside for pre-sales is where you get a confirmed sales, and you need not waste a single cent on something nobody wants. the downside is, you need extra effort to convince your clients with just an idea or an unfinished product.
- Cutting Down Cost the creative way – There is always another way. Creative imagination is needed to face all obstacles. For examples, instead of printing hardcopies of glossy colour brochures, you can utilized the internet to spam the market. Share your office, share your phone bills, utilized 2nd hand furniture and computers. Employing the Art of Barter,create a win win situation for all parties. You need to loose some to gain some. Every lawyer tells you that contracts must cover all possible circumstances and they charge you at a fly high cost, but you have forgotten that there is no point in suing a bootstrap business because we don’t have money to give anyone. An astute way of avoiding hefty professional fees is to invite your key contacts joining your advisory boards.
- Getting alternatives Financing – If you had a rich father, lure him into the business ~ lol (without his control). Banks seldom borrows to a bootstrap business, the alternatives ways can only be friends and family or governments and clients. Getting your first line of credit can take time and patients, but please provide an “excite” to the creditors, is best with a confirmed Sales Contract on-hand. Or ask your clients to advance your payments for you to kick-start.
- Managing that Precious Cash – Create your cash flow forecast, plan your cost, and reduce any possible unnecessary expenses. Some research and negotiation with different vendors/suppliers/services provider is needed to understand your cost in-order for you to plan your cash flow. Employ progressive payments and advance payment and spend less. Motivate and maximized your staff capabilities. (If you don’t have money for meals, eat bread and cheese everyday to get you fuel up, joking.)
- Marketing on Shoestring – Ignore on Market Research and Advertising on the start. You can think of a FREE Model to assist your marketing objectives. Pick a clear cut message and promote your differentiation and take advantage of today’s technology with internet marketing. Put in clear strategy and avoid to be blown in all directions.
- Focused Directions and Vision – Small companies tends to diversify too much in all areas in-order to survived. Taking our animation company which focused on cartoons development as example, why not we take up some advertising jobs or graphic design job in-order to sustain the company. My answer will be NO. In my own opinion, being too diversify with different areas makes your company looks unprofessional, and worst, it may even get your company to no where because you do not have a clear objectives and directions for your company. I prefer to focused on 1 area, and be the best of that area.
Please do share with me if you had any other ways to bootstrap a business. Businesses have to help each other to ride through the tough times.
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Life is interesting, its all about experimenting, trial and errors and self improvments. This blog is all about my personal experience. I am full with ideas, and i will achieve every one of them step by step.
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