start your company with 0 $

Filed in archive Entrepreneurship , Venture Capital on October 14, 2003

Jeffrey R. Cornwall has pointed me to this interesting article from Inc. magazine. It gives half a dozen of examples how start a company with basically no money upfront.

"Kitty Hawk Group Inc. � Founded: 1978 � Start-up capital: $0 � 1994 revenues: $108 million

How do you start a $100-million company with no cash? Well, you don't start a $100-million company: like your older brother's hand-me-down dress pants, a $100-million company is something you grow into.

Tom Christopher started what would eventually become the Kitty Hawk Group in 1978. And he had no cash whatsoever...."

While it's true that there are business models, which are very difficult to proof without a five or six digit amount, money is mostly just one ingredient. I have seen so many business plans just displaying an idea and lacking of prototyping, proper market research and beta customers. It does not make sense to raise seed money having nothing in hands. The bootstrapping variant has the advantage to discover the biggest benefits of your innovation or differentiation. It also protects you from too big and wrong investments. Start small, make many mistakes and grow fast and make few mistakes. There is no success without suffering....