Nov
18
The Bootstrappers Bible by Seth Godin Captured
Filed Under Business Ideas, Resources, Principles, etc., Favorite Books, Free Book Summary - Online
Seth Godin has rights to an ebook he wrote and he’s giving it away for free. I downloaded a copy and thorougly enjoyed the entire book.
THE JOY OF SMALL
Advantages of the big corporations
1. Distribution – they have huge, established distribution chains.
2. Access to capital – these guys are big and can borrow big bucks. They use this money to beat anyone out if they can.
3. Brand equity – Nike can command a pretty penny and has built a reputation.
4. Customer relationships – established customer relationships are a huge advantage. It’s hard to lure customers away.
5. Great employees – big companies, with their security and famous reputations, attract amazing people.
But the underdogs can play many things to their advantage:
Advantages of Bootstrappers
1. Nothing to lose – HUGE. While the big company’s beauracracy fumbles to make decisions trying to protect their old ways of doing business, you can move on the market and embrace new territory.
2. Happy with small fish – the first animals to die in the ocean are big fish because they need soooo much to eat.
3. Presidential input – the pres can actually positively influence the entire company.
4. Rapid R&D – Sometimes bigger teams doesn’t give a company an advantage.
5. The Underdog – Others are willing to help you out with discounts. Big companies are always charged full price.
6. Low overhead
7. Time – you aren’t forced to do things at certain times because you’re not answering to public shareholders. Big companies don’t have that luxury.
Don’t play the big companies’ game or you’ll get eatin. Play your strengths.
Id became famous for Castle Wolfenstein. The 4 guys who built it decided to follow their own rules against the big boys. They built Doom, gave it away for free, and millions loved it. Then in stage two they offered a deluxe version with more levels, more monsters, more everything and sold it directly by mail order. Id redefined the business and won.
A GREAT IDEA CAN WIPE YOU OUT
“What’s a great idea? Something that’s never been done before. Something that takes your breath away. Something so bold, so daring, so right, that you’re certain it’s worth a bazillion dollars.”
Stick with things that have worked before, in other industries. If it’s been done once, it can be done again. Get a real business model.
Key elements:
Distribution – Where is it sold to the customer?
Sales – Who is selling it for you and how will they be compensated?
Pricing – What do wholesalers and retailers and consumers pay?
Production – How do you make it?
Raw materials – Where do you get what you sell?
Positioning – How do the ultimate users position the product in their minds?
Marketing – How do consumers find out about it?
Barrier to entry – How will you survive when competitors arrive?
Scalability – How do you make it bigger?
First off, start the right business.
1. Profitable.
2. Protectible
3. Self-priming
4. Adjustable
5. Exit strategy (optional)
Decide whether you’ll be a free-lancer (skills) or an entreprenuer (for business models’ sake).
Great bootstrappers find an existing business model and embrace it.
1. You can be certain it can be done.
2. You can learn from previous mistakes.
3. You can find a mentor.
4. You’re not alone.
Look at the value chain in looking at a business model.
1. Who’s going to buy your product or service?
2. How much are they going to pay?
3. Where will they find it?
4. What’s the cost of making one sale?
Take an extra month to get the business model right. Don’t plan too much because you’ll never get out and do it.
DOING THE MATH
A few pointers on debt:
1. Don’t, unless it’s professional.
2. Only get into professional debt when it’s to make money.
3. It’s better to save the money than to go into debt for it.
4. When you borrow from family and friends, spell it out very well.
The most important things is that you sale. You have sales. You can do almost anything.
1. Sell something that people want to buy and know how to buy.
2. Own the sells process.
RINGO WAS THE LUCKIEST BEETLE
Rule 1. Find people who care about cash less than you do.
Rule 2. Survival is success.
Rule 3. Success leads to more success.
Rule 4. Redo that mission statement and business plan every 3 months.
Rule 5. Associate with winners (customers, employees, vendors, and peers)
Rule 6. Beware of shared ownership (or, why Ringo was the luckiest beetle) Try 5/5 and split the other 90 over time according to performance.
Rule 7. Advertise! Spend regularly as investment, Persist, be clear, test and measure
Rule 8. Get mentored.
Rule 9. Observe those birds that clean the hippos’ teeth
Comments
2 Comments so far
Neal, can you please email me a copy of the bootstrapper’s bible? i;d appreciate it.
thanks,
dave
Neal, I’d love a copy of Bootstrapper’s Bible too, if it isn’t too much trouble. Thanks!