7 ms·

This is bad news for bootstrapped startups. If cash stops being a cocaine-tier obsession for these guys, we might have to compete with them. Sad.

manigandham 10y ago
This is great news for bootstrapped companies which are likely used to running lean, might actually be profitable, and can outrun and outlast an inflated competitor. Major cashflow changes tend to be disastrous for most companies, it's just not that easy to realign everything. If you're up against a competitor that has raised a lot easy money and now needs to show results, you should be happy to see this.
- x0x0 10y ago
  Perhaps. Or you can be stuck competing with a company that is pissing money into a hole and offering what appears to be a similar product for free. How are they ever going to become a functioning business w/ revenue > expenses? Underwear gnomes! Been there, done that, it sucked.
  - infinite8s 10y ago
    That's what is happening now. Once those companies run out if easy money they'll be forced to actually compete on value instead of just handing product away. Which is great news for bootstrapped companies that are used to functioning without bleeding cash.
cylinder 10y ago
Downturns favor smart people. I'd like a return to reality.
joelrunyon 10y ago
I think it's the opposite. The people that are used to easy VC money (without growth or a business model) will probably wash out of the ecosystem. I doubt they're going to reshape their business structure to be a bootstrapper competitive one.
darpa_escapee 10y ago
How did the definition of bootstrapped business get redefined as "running a questionably sustainable business on millions of outside investors' dollars"?
morgante 10y ago
Could you explain your point? Conventional reasoning is that decreased VC investments is actually good news for bootstrappers, as it winnows down the competition of people offering unsustainable unit prices with outsized markets. If everyone is forced to seek fast profitability, bootstrappers are the most experienced at it.
- carsongross 10y ago
  I was joking that the lack of free cash might focus the VC-backed startups on areas where bootstrapped (and presumably profitable) startups already are. I don't actually think that will happen much: typically the structural costs associated with VC-backed companies is too high (e.g. SF rents) to even get close to what bootstrappers can do.
jacquesm 10y ago
It's the best thing to happen for bootstrapped start-ups. They'll eat over-funded start-ups for lunch, those won't be able to get follow on money when they eventually run out and so will implode. I weathered the dot-com crash in exactly that fashion, it did wonders for us by decimating the competition.

manigandham 10y ago

This is great news for bootstrapped companies which are likely used to running lean, might actually be profitable, and can outrun and outlast an inflated competitor. Major cashflow changes tend to be disastrous for most companies, it's just not that easy to realign everything. If you're up against a competitor that has raised a lot easy money and now needs to show results, you should be happy to see this.

x0x0 10y ago
Perhaps. Or you can be stuck competing with a company that is pissing money into a hole and offering what appears to be a similar product for free. How are they ever going to become a functioning business w/ revenue > expenses? Underwear gnomes! Been there, done that, it sucked.
- infinite8s 10y ago
  That's what is happening now. Once those companies run out if easy money they'll be forced to actually compete on value instead of just handing product away. Which is great news for bootstrapped companies that are used to functioning without bleeding cash.

cylinder 10y ago

Downturns favor smart people. I'd like a return to reality.

joelrunyon 10y ago

I think it's the opposite. The people that are used to easy VC money (without growth or a business model) will probably wash out of the ecosystem. I doubt they're going to reshape their business structure to be a bootstrapper competitive one.

darpa_escapee 10y ago

How did the definition of bootstrapped business get redefined as "running a questionably sustainable business on millions of outside investors' dollars"?

morgante 10y ago

Could you explain your point? Conventional reasoning is that decreased VC investments is actually good news for bootstrappers, as it winnows down the competition of people offering unsustainable unit prices with outsized markets. If everyone is forced to seek fast profitability, bootstrappers are the most experienced at it.

carsongross 10y ago
I was joking that the lack of free cash might focus the VC-backed startups on areas where bootstrapped (and presumably profitable) startups already are. I don't actually think that will happen much: typically the structural costs associated with VC-backed companies is too high (e.g. SF rents) to even get close to what bootstrappers can do.

jacquesm 10y ago

It's the best thing to happen for bootstrapped start-ups. They'll eat over-funded start-ups for lunch, those won't be able to get follow on money when they eventually run out and so will implode. I weathered the dot-com crash in exactly that fashion, it did wonders for us by decimating the competition.