Introducing the ‘Bootstrap Business Plan’

When investor sentiment goes south a successful entrepreneur will often look to create an alternative business plan where they rely upon themselves for any/all financing. This is called a Bootstrap Business Plan.

One great example of a bootstrap plan is George Lucas, who upon filming his epic space opera, Star Wars didn’t know if it would find an audience. Indeed, he and his distribution partner were said to be extremely nervous about the potential for success. As a way of mitigating the risk for its sequel he imagined two versions, one where Star Wars was successful and another where it was not. We all know what the sequel was called, but what is not commonly understood is that if the original Star Wars had flopped George Lucas would have made a sequel. The story was much smaller in scale and called ‘Splinter of the Minds Eye’.

The bootstrapped plan is not used as a marketing document or driver of an Information Memorandum. It is an agile (not Agile) approach to creating a plan. As a result, the document does not have to include the normal constituent parts of a formal business plan, such as exec summary, share ownership, or exit strategy. Instead, it is meant for you and your team. A plan to help you understand your business.

Below are six key ingredients of a bootstrapped business plan: