3.0 out of 5 stars
a handful of golden acorns, 25 Aug 2009
Some say that small businesses will lead the way out of the global economic downturn, presumably because hard times create necessity - the mother of invention.
I am not so sure, although I would be pleased to be proven wrong. I suspect that the credit crunch will give us only a handful of golden acorns - but not a forestful.
Very few newly-founded, small businesses get sufficient traction, quickly enough, to have the broader short-term impact that we will need to restore much-needed economic 'normality.'
For sure, history teaches us that even the largest enterprises all begin with an individual with an idea. However, not every acorn fulfils its potential to become a mighty oak tree.
For every multinational conglomerate founded in a back bedroom or garage, there are millions of would-be entrepreneurs who don't realise their ambitions.
That's life - the world of business is a harsh environment, even in the best of times, and we have to deal with it. But having a go is what it's all about. Actually doing something new and risky; not just daydreaming.
Building any sort of new business needs substantial investments: time, effort and money - especially money. But where do you go when the money supply for risk has pretty much dried up?
During hard-pressed times, the traditional sources of funding (e.g. Banks, Venture Capitalists) tend to sit on their hands and raise the drawbridge - or at least make borrowing difficult and expensive. The would-be entrepreneur has to look elsewhere for investment. Or, perhaps, become even more inventive.
Sramana Mitra has written a book (Bootstrapping: Weapon of Mass Reconstruction) to show that successful businesses can be built without formal borrowing. The book contains a dozen case studies of successful [mostly online] businesses that have been built on the principle of bootstrapping - development through progressive re-investment of revenue, rather than borrowing money and watching the burn-rate until the business either prevails or fails.
Mitra has structured the narrative interviews with the successful entrepreneurs into four useful sections:
Doing more with less;
Getting started with little or no capital
Validating the market - on the cheap
Resurrecting the dead
All of these topics are attractive to readers keen to start out as business owners. I must say though that this is not a 'how-to' book, more of 'how we did it' compendium. The case studies are particularly relevant to online/ intellectual property propositions and somewhat less relevant to 'bricks and mortars' entrepreneurs.
Bootstrapping: Weapon of Mass Reconstruction is a fair insight into how a previous handful of golden acorns was nurtured into healthy maturity. You will also find some useful war stories of what was less successful too. Could be a useful book, if you are about to embark on the search for your own golden acorn.
Disclosure: the publisher sent me a free copy of the book.