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BAP #1: Bootstrapping a business vs playing a business

Published May 29th, 2005 edit replace rm!

[ Just added this to my new series on Antipatterns ]

A mistake I myself have made as well as many other smalltime entrepreneurs is that we have wanted to appear like a business to early. Symptoms of this are things like:

  • Incorporating
  • Renting office space
  • Buying a fax machine (You know a business needs one)
  • Fancy stationary
  • Fancy graphic designers
  • Multiple fault tolerant high availability servers
  • Human resources officer (If you’re a startup and have one these you really are on the slippery slope)
  • etc. etc.

These are all fine at the correct phase of your business, but don’t waste these huge money suckers without an actual need.

I for example have rented a server which hasn’t really been in use since february. That is ¢49 out the door every month. Stupid really. Now is when I need it and I could have saved ¢147.

I also just bought business cards from VistaPrint because I’m going to Reboot in a couple of weeks and it’s handy to have at such events, but if not it would have been a waste of money at this time.

If you think about it one of the traps that leads to big businessitis is playing a business. This is often necessary if you want to attract venture capital, after all they want to know that you are serious and have things like a fax or an hr department. But really, I think the businesses who really succeed are the ones that focus on their business model and not how they appear outwards.

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My name is Pelle Braendgaard. Pronounce it like Pelé the footballer (no relation). I live in wonderful Managua, Nicaragua. I work with Clojure, Bitcoin and Ethereum.

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