Show Me The Money, Part II

In the second of a two-part series, the author explains how to fund your business from within, via customers, consulting, and cost control.

Sometimes it’s best to bootstrap before seeking a structured financing round with outside sources. In this column, I’ll talk about financing your business without going to someone else for money via customers, consulting, and cost control.

Customers

One of the most traditional ways to fund your company is to have your customers fund your growth. Wow, what a concept! In the days of the high-tech Internet boom, entrepreneurs all but forgot what spurred a lot of the biggest businesses around: selling products to customers and funneling the revenue back into the company’s operations and development. This is a great way to maintain control of your company and generate positive cash flow.

Take this example: One of the startup companies I worked with had a client that needed its sales executives to be more effective at managing its third-party resellers. The startup company had a sales-force compensation product that, with a few enhancements, would have solved the customer’s problem...