Bootstrapping A Technology Startup

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Bootstrapping A Technology Startup

• Dorai Thodla
• Twitter dorait, email dorait_at_imorph.com

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A Few Random Quotes

• Invest In Yourself
• http//tinyurl.com/cnkoto
• In the information economy staying current is the
  name of the game. http//g2th.com/?gsiwqqi

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Four Startups

• iMorph, Inc. California, USA (Current)
• Coromandel/Integra, New York, NY (Previous)
• Information Technology Systems Bangalore, India
  (Second)
• Digital Software Systems Chennai/Bombay (First)

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Funding Models

1. Family Business
2. Venture Funded Business
3. Bootstrapped Business
4. A mix of 2 and 3

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Bootstrapping

• Start with your own savings, Or
• Earn your way through consulting

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A Few Terms

• Angel/Seed Funding Family Friends
• Series A VC(s)
• Series B, C Bridge, Exit
• Exit can be IPO, Merger or Outright Purchase

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Typical Pattern

• Bootstrap till you get an initial product
• Find the first customer (may or may not pay)
• Find a small set of paying customers
• Establish a market
• Be self-sustaining OR
• Get Funding to Grow the Company

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The Saga of Four Startups

• iMorph, Inc. California, USA (Current)
• Coromandel/Integra, New York, NY
• Information Technology Systems Bangalore, India
• Digital Software Systems Chennai/Bombay

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Questions A Startup Must Ask Itself
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The 6W Framework
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Who?

• Who is my customer?
• Who uses the product?
• Who pays?
• Who else is in the market?
• Who sells to the same customer?
• Who can I partner with?
• Who controls distribution in the channel?

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What?

• What industry segment?
• What Category?
• What is the market size?
• What is the right price?
• What is the right discount?

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How?

• How will I validate my product idea?
• How do I reach my customer base?
• How will I find the first customer?
• How will I generate leads?
• How will I convert leads to prospects?
• How will I find who my competition is?
• How will I get referrals?
• How much can I charge?
• How big is the market?

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Where?

• Where do I advertise?
• Where do I find leads?
• Where do I locate my business?

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When?

• When do I expose my product?
• When do I approach VCs
• When do I go to beta?
• When do I release the product?
• When should I hire key people?

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Five Ways

• Find Needs Fill Them
• Find Trends Leverage them
• Find Gaps Cover them
• Find Opportunities Explore them
• Find Disruptions Exploit them

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A Few Trends
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Exploring a Few Trends
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Mobile Computing Trends
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Web Trends
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Web 3.0 or Open Linked Data
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Software Trends
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Software Trends (contd)
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The Power Law

• Out of 1,000 crazy ideas, only 100 will merit
  serious consideration. Of those, only 10 will be
  worth a serious investment, and out of that
  modest bundle, only 1 or 2 will have the power to
  transform a business or spawn a new one.

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Ideas Trigger Ideas
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Ideas Trigger Ideas(ex MP3 Player)
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Idea Pyramid
Prototyping, Implementing, Testing
Thinking about Ideas Filter based on interests,
goals, research
Free Thought. No judging, no selection. Write
all ideas down
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Idea to Innovation

• Value
• Implementation (skills/resources)
• Risk
• Potential

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Can a Teacher or Student Start a Company?
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What Skills Are Needed?
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Is It Better to Do a Job First?
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What Kinds of Job(s)?
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Start Alone or With Friends?
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What Kind of Team?
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Products or Services?
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How To Get the First Customer?
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Questions! Questions!

• Funded or Bootstrapped?
• Local or Global?
• Products or Services?
• Give it Away or Charge for it?
• Breadth or Depth?
• Low-end or high-end?
• Use a platform? Or Be a platform?
• Tools or Applications?
• Improve Existing Product or Build New Product?
• Incremental Innovation or Radical Innovation?
• Established categories or New Categories?
• Do I scratch my own itch or find a few people
  with itches?
• Small or Big?
• Direct Sales or through internet?
• Java or dotnet?

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And More Questions

• What is the business model?
• How does the world know we exist?
• How do we keep up with information?
• How do we validate an idea?
• How do we know what it is worth?
• How do we know that there is a market?
• How do we get your first customer?
• How can we be different?
• What if I am a marketing guy?
• What if I am a techie with no marketing
  expertise?
• How can we ride a wave? How do I catch one?

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Questions?

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