Thank you for posting this. It's nice to see a startup article on here for a change that isn't about getting lots of investment money.
There are a few things I'd add, having done essentially what the article is about:
* Concentrate on making money, not on saving it. Saving money is important, but it's more important to continuously figure out how to grow your bootstrapped business, and it's easy to be distracted by various tactics for saving money.
* Focus on what's important for your particular business. I've poured a lot of time, money, and effort into various projects that weren't important to my business -- things like advertising, marketing, community projects. There's absolutely nothing wrong with those things, but they're probably not vital to your business in the first year or two.
* Do what you're good at, and
* Don't hesitate to farm out what you're bad at it. I'm terrible at bookkeeping, for example; it doesn't make sense for me to try to spend my time doing that, and making a mess of it, instead of having someone take care of it for me.
I bootstrapped by consulting while working a couple of part-time jobs. As the consulting work grew, I gradually freed myself from the jobs, and then as the consulting work finally merited getting more help, I've freed myself from that, too.
On your first point, are you saying not to shy away from paying for things?
A friction against action I have fought is that I could pay for a service through which I could create more value, but paying for it means I need so many X new customers a month to make it worth it.
Well, yes and no. I'm saying that knowing when to spend money, and when not to, is a fine balancing act for the bootstrapper, and that it's self-defeating to concentrate more on saving money than on generating more revenue.
As an example: very early in my business, I paid the monthly fees for crossbrowsertesting.com (a great service btw). Some months, I could barely afford it, but at the time I was doing a lot of web work and I justified the expense by how much time was saved dealing with follow-up issues from clients.
Conversely, I really struggled for a while because I waited too long to hire on help, and I could no longer manage my business's growth by myself. Clients got frustrated, deadlines lagged, and I wasted a lot of effort trying to save the additional cost each month of some help.
I've also found that, for me, having expenses helps to motivate me to keep growing the business. It would be possible to survive as a business by simply cutting costs until the costs were lower than the revenues, but I prefer to look at it inversely: keep growing the revenues so that they stay higher than the costs. I have no idea if that would work for you, but it might be worth trying for a while.
So, yeah, if you could pay for a service that would help you create more value, then maybe you should do that. You might find that when it creates more value for you, you're able to handle more customers, which helps you to find the time to go out and get those extra customers that you need to pay for the service.
I would throw in a 37Signals quote in here and advise "sell your byproducts." There is money to be had from residual assets used in the process of building your main product.
Did you create some nifty icons, or write a custom graphing engine for your mobile app that looks really nice? Cool. Put up a Paypal-based checkout site. Sell licenses.
The risk there is that it can take a lot of effort to productize an internal tool. You need to polish it so people think it's worthwhile paying for (good design, integrations, etc.), harden it against security concerns, and so on.
No doubt. Before taking that complicated step, throw the idea out there that you are willing to license it. Get a few developers to do that as single transactions, where you walk them through code integration. If it proves too popular for you to manage, you now know you have a market, and a reason to build out a full API and battle test it.
Entertaining, but not too useful. If you really can't spend $10 on a ___domain name, you'd better go out clean few windows, and then buy it. Being too cheap is a sure recipe for failure, or if not failure, for a lot missed potential growth.
I've always been economical in my business ventures, and respect people who don't hurry to spend money on stupid things. But many of the points givem here are just way too cheap, unproductive and plain bad.
Decent post, but really don't like being blasted with the AdSense right off the bat. Had I found that site through a search, I would have hit the back button. Just FYI.
There are a few things I'd add, having done essentially what the article is about:
* Concentrate on making money, not on saving it. Saving money is important, but it's more important to continuously figure out how to grow your bootstrapped business, and it's easy to be distracted by various tactics for saving money.
* Focus on what's important for your particular business. I've poured a lot of time, money, and effort into various projects that weren't important to my business -- things like advertising, marketing, community projects. There's absolutely nothing wrong with those things, but they're probably not vital to your business in the first year or two.
* Do what you're good at, and
* Don't hesitate to farm out what you're bad at it. I'm terrible at bookkeeping, for example; it doesn't make sense for me to try to spend my time doing that, and making a mess of it, instead of having someone take care of it for me.
I bootstrapped by consulting while working a couple of part-time jobs. As the consulting work grew, I gradually freed myself from the jobs, and then as the consulting work finally merited getting more help, I've freed myself from that, too.
It's a classic old formula that works.