Editor’s Note: Happy Sunday. If you missed this morning’s post on the second part of the Sustainability Strategy tackling hard social issues such as homelessness and affordable housing, you can read it HERE. Right now, we have local small business consultant Emma Payton back on site discussing bootstrapping as an alternative way to fund start-up businesses. Here she is:

In the first article of this series, we explored some of the myths and realities of self-employment or owning your own business. In part two of the series we explored entrepreneurial attributes. In this article we will explore the concept of bootstrapping.

When thinking about starting a business, one of the first things people must think about is how they will fund the business start-up and, depending on the type of business, how they will fund the business as it goes through its early stages. Despite common mythology, not all businesses make money in their first one to three years, and often business owners are not in a position to draw much of a wage in that period of time.

A well researched business plan should give you a pretty good idea of what you can expect. However, you must always expect the unexpected and have backups in place.

Many people simply do not have any money they can invest, do not have access to venture capitalists or conventional financing, or simply do not want to go into debt to start a business.

According to David Worrell, “99.9 percent of business owners will struggle alone, pulling themselves up by their bootstraps. And that’s not necessarily a bad thing. With a little luck and a lot of pluck, bootstrapping a business can be both financially and emotionally rewarding”. Finding less conventional ways to finance your business can be better in the long run – you learn to work within a tight budget and make do and you appreciate the struggle and celebrate your successes.

Bootstrapping can be defined as everything an entrepreneur does to both raise and minimize the resources needed to launch his or her business and carry it through its early stages. In other words, starting a business without external capital (i.e. bank loans) and finding creative ways to make the business work.

There are many examples of bootstrapped businesses. Dell Computers started out of Michael Dell’s dorm room, which saved on overhead costs such as commercial rent. Craig Newmark of the now famous Craigslist bootstrapped his business.

There are many ways to self-finance or bootstrap your business. Here are just a few:

- A baker might start out by renting commercial kitchen space on an hourly basis from another business and selling the products at a farmers market.

- A massage therapist might start out by doing “home visits” or by sub-letting space from another therapist.

- A manufacturer might lease equipment and upgrade regularly to avoid tying up capital by purchasing equipment.

- A photographer might keep their day job while building up a clientele. As the business grows, he or she could reduce their dependence on employment and become increasingly self employed.

I know of someone who planned for their business well in advance. Her family lived on a portion of her income and saved the rest to invest in her business start up for almost two years. Not only did she have the money to start her business but her family was also used to living with less.

If you’ve decided that you can’t, or won’t, look for external sources of funding to start your business, then bootstrap it. Look for creative ways to support yourself and your business while you start and grow it. It might not be easy, but in the long run you may feel a unique sense of pride in your accomplishments.