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5 Ways to Stretch Your Startup Dollars

After founding a couple of startups and being in the startup scene for a while, I've learned a couple strategies on bootstrapping and starting a company on a budget.

Here are my strategies on maximizing your runway and stretching your startup dollars:

1. Don't start a company without a "war chest"

This is counterintuitive to the title, but the best way to stretch your dollars is to have dollars saved away before starting your company.

I learned this one the hard way. I tried to start my last company with limited savings and the strategy to raise funding from investors. I ended up spending all my time writing the business plan, pitching to investors, and not working on the product...

Although we were able to raise a small seed round, eventually we ran out of money and the company fell apart.

I made sure for my next company to save money towards my "war chest", which freed me to focus on actually building the company.

2. Cut your living expenses

Rent is usually your biggest expense, particularly if you live in a major city. So I have a couple of unique strategies to cut your costs.

Go abroad. After I did my user research, I subleased my apartment and moved to Peru for a few months to build the MVP. Coming from San Francisco, that was a huge cost savings on both rent and general living expenses.

Airbnb your apartment. One of my friends paid $300 / month for his two-bedroom apartment in Los Angeles. He always rented the second room on Airbnb, then he occasionally rented out the whole apartment and would stay at his girlfriend's place for a couple days.

Mom and dad. Yeah it's not ideal, but if you're serious about your business you'll do whatever it takes.

3. Attend an incubator

Accelerators and incubators are great ways to get some extra funding and to expand your network. Not all incubators require you to give up equity as well.

Startup Chile will give you ~$30K for "free". What they want in return is for you to help build startup ecosystem there. This can include holding a workshop for students, giving a talk on a topic you know well, etc.

4. Leverage cheap marketing opportunities

Building awareness for your company is one of the harder aspects, especially if it's an area you don't have experience in. One route is paid advertising (Facebook, Adwords, Twitter), but that can get expensive very fast.

Here are some other strategies to build awareness on a budget:

Go to networking events. I've met a lot of interesting people going to events I found on Eventbrite and Meetup. I've made tons of connections that led to new connections and onwards. Plus most of these events are free.

Email. It's one of the cheapest ways to directly reach people who may be interested in your product. Lately I've been using this web scraper chrome plugin to capture a list of contacts, Email Hunter to get their email address, and Mixmax for sending and tracking opens/clicks.

Social networks. Yeah I'm sure you know, but Twitter and Facebook are great resources and an easy way to build up a following. One pointer, don't use it to solely post company updates. Try to be helpful and provide resources.

Press. Can be a bit challenging, but there are some great guides on how to do this properly. Check out Hey Press for their great guide on getting press.

5. Track your finances

Monitoring your burn rate is critical. You don't want to be in a position where you're out of cash and your back is against the wall. Tools like Quickbooks are a good starting point for your startup and most accountants are familiar with it.

When starting a company it's basically a race to build a product and get customers before you run out of money. Hopefully you find some of these strategies useful. Good luck out there.