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The New Garage: Bootstrapping Your Startup


I came across a Google Plus debate awhile back discussing what the new garage was for startups. To give you a brief background, a few famous startups actually started in a garage.

The Apple boys used Jobs’ parents’ free garage. The Google boys used a friend’s garage for free (initially). HP founders used an unattached garage that was part of the home for which they shared the rent (Dave Packard and his wife lived in the house).

Thus the G+ thread was a discussion about what has replaced real garage spaces as a place where startups should startup. In the post’s comments, a number of apparent startup founders were praising the virtues of co-working spaces, claiming that they are the new startup garage.

I found this statement odd. Bootstrapping founders don’t pay for anything until they absolutely need it. Even if a startup has more money than they know what to do with, wise founders don’t pay for something until it is essential. To me, whatever is the cheapest location option for a startup is the new garage.

The key with the startup-bootstrapping approach is to minimize expenses upfront. Use space for which you are already paying but not using efficiently–your bedroom, dining room, garage, shed, basement, one-room apartment, or dorm room. Or borrow (for free) extra space in your parents’ or friend’s home or apartment. Coffee shops or even libraries might work too but co-working spaces definitely do not. Why spend precious resources when you can get space for free. Once you have an initial product to demo, and you’re beginning to gain traction, it may make sense to look for better facilities.

Renting an expensive place will not make you successful. The “it’s key for networking” mantra is a thinly veiled excuse. Nothing prevents you from networking if you work out of your house. If people only networked with people whom they share the same physical office building, then the world would collapse.

Whether you’re a bootstrapped startup or a well-funded startup, the key is execution on building your prototype, creating your MVP. Don’t foolishly waste cash just to be in a cool place. If you don’t have a founder’s team that can successfully execute the startup’s vision, then the team is flawed. Having the coolest place on earth will not change that. Besides, what can be cooler than starting up in a real garage — especially in the winter!

Note: Before any of my readers get a guilty feeling that I’m talking about you and your startup, relax. I’ve held this view for years and decided to share it after reading the interchange on the aforementioned G+ post. After all, my current startup uses the already-paid-for space in my house and my business partners’ houses. Although there is a fabulous co-working space in a high-tech park less than three miles from my house, I have zero interest in paying for more real estate when I already have real estate that I can use.

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