We’re all familiar with Robinson Crusoe, the adventure novel by Daniel Defoe, published in 1719. The book follows the title character after he is cast away on a remote tropical desert island, encountering cannibals and mutineers before being rescued.
Crusoe has many sea faring adventures. He first sets sail from Hull on a sea voyage against the wishes of his parents, who wanted him to pursue a career in law. After a tumultuous journey his ship is wrecked in a storm. Despite this, his desire for the sea remains so strong that he sets out to sea again. This journey also ends in disaster, as the ship is captured by pirates. Two years later, a captain of a Portuguese ship rescues him. With the captain’s help, Crusoe procures a plantation in Brazil.
Years later, Crusoe joins an expedition to Africa, but his luck fails again, and he’s shipwrecked on an island off the Venezuelan coast, which he calls the Island of Despair. Only himself, the captain’s dog, and two cats survive the shipwreck. Overcoming his predicament, he fetches tools and other supplies from the ship before it breaks apart.
After being shipwrecked, a bamboozled Crusoe makes his island prison habitable. Salvaging what he can from the wreck, he fortifies a cave. He hunts, grows barley and rice, dries grapes to make raisins, learns to make pottery and raises goats. He fills his improvised shelves with pigeon, turtle and other foodstuffs. He also adopts a small parrot.
More years pass and Crusoe discovers cannibals visit the island to kill and eat prisoners. He dreams of obtaining one or two servants by freeing some prisoners; when a prisoner escapes Crusoe helps him, naming his new companion Friday after the day of the week he appeared. Eventually Crusoe is rescued and goes back to England.
After spending 28 years, two months and nineteen days trapped in a Kafkaesque nightmare marooned on a remote desert island, Crusoe showed all the attributes of a bootstrapping startup founder – from sheer necessity. Besides escaping pirates and shooting cannibals, like a startup founder his real battle is against scarcity, which he defeats through careful management of the meagre resources at his disposal, including his own labour.
There are a lot of economic insights in the story, here are some we can take into our bootstrapping startup practices.
1. Balance your time Nothing is simpler than a one-person Robinson Crusoe economy. He was a one-man market of supply and demand. Such an economy features in a textbook by Hal Varian, chief economist at Google. Crusoe must decide how to divide his day between gathering coconuts and working on his tan. In keeping with diminishing marginal utility, each extra coconut or hour of sunbathing is worth less than the last. Each hour of work also yields fewer coconuts than the last.
Under these assumptions, Crusoe should stop working at the point when an extra coconut is worth no more to him than the additional leisure he must sacrifice to gather it. Of course, far from working on his tan, Crusoe hid from the sun, making a clumsy, ugly, goat’s-skin umbrella to ward off its rays.
Takeaway: Crusoe is a rational man, always equating marginal this with marginal that, mercurial and conflicted. As such, he lends himself to psychologically informed theories of decision-making. He could become an icon of behavioural economics! The lesson is work on your priorities and balance your time, ration, and schedule your work activities to move your startup forward holistically, not just on your ‘favourite’ tasks.
2. Control your emotions. Emotional control is a vital characteristic of successful entrepreneurs because decisions made in an emotional state are almost always bad decisions.
At one point, Crusoe uses his scarce ink to take stock of his predicament, drawing up a balance-sheet of comforts and miseries. He is a lone castaway (a debit), but he is alive (a credit). The island is uninhabited (a debit), but it is not barren (a credit). He has no defences (a debit) but the island has no obvious predators (a credit). No companion survived the wreck (a debit), but provisions could be salvaged from it (a credit).
The choice of reference points when bootstrapping is not always obvious. On each line of his balance sheet, Crusoe entertains alternatives. His shipwrecked isolation represents a grievous loss, but it counts as a gain from an alternative scenario in which he drowned or washed up on a more perilous shore.
Takeaway: keep a balanced perspective, just because things are tough, don’t fall for a victim’s mentality as the default. Bootstrapping is really about bootstrapping yourself mentally and physically, so check in on your own well-being to secure a sense of balance and achievement – looking after the founder mindset demands this.
3. Survive until you thrive. After Crusoe abandons the wrecked ship, it drifts closer to shore, allowing him to return to it and strip it bare. He survives on the island through a combination of common sense, determination, and ingenuity.
When things go wrong and your startup veers off the rails, bootstrappers do whatever it takes to survive. They work around the clock to fix what went wrong, they find the resources to solve a seemingly intractable problem, they prioritise finding a solution.
The number of balls entrepreneurs have in the air can overwhelm. They have to figure out a way to grow their business with limited funds, simultaneously manage staff, customer relationships, product roadmap etc. They have to create processes that work.
Takeaway: Founders, like Crusoe, are often pulled in ten directions at one time, which saps them of their energy. Unlike Crusoe, most founders also have a family to support which requires dedicated time and emotion. Focus on surviving, focus on building your team and customers. Like Crusoe, focus on what you can control and where you have an impact. Build your Minimum Viable Startup.
4. Pivot to be thrifty. When in survival mode, self-starting founders figure out, very quickly, what works and what doesn’t work and then pivot. Successful bootstrappers are master pivoters. They learn how to shift gears, change direction, and alter the path they take in order to keep moving forward towards their goal and navigate around barriers.
Success (however you like to define it) does not come in a straight line. There’s a great quote from John Lennon that captures the essence of a bootstrapper’s determination: Everything will be alright in the end, and if it is not alright, it is not the end.
Pivoting means being thrifty, using your resources optimally. Gathering up whatever you can and thinking about how to preserve it is essential when you’re bootstrapping. Crusoe takes pains to furnish himself with many things I foresaw would be very necessary to me.
Takeaway: Making rapid but considered decisions is vital to founders when resources are limited and stretched. Always have your north star and OKRs held high in your mind to guide and pull back any wayward thinking.
5. Be resilient. Crusoe’s resilience comes through time and again. In one instance, finding supplies on the recently wrecked ship but without a boat to transport them onshore, he exclaimed must joy always be followed by bitterness? He bounces back as it is in vain to sit still to wait for what’s not to be had? He improvises and works with what he has to improve his situation.
When faced with challenges, he finds it within himself to face them and be resourceful. You may have to fight a battle more than once to win it. Resilience powers grit. Purpose gives your efforts meaning. In starting from a desperate position, Crusoe discovers that even the simplest development is a minor miracle of economic choreography.
Takeaway: Crusoe accepts his fate and creates diversions for himself. He reads the bible, keeps a journal of important events, marks the days on a tree trunk, and crafts things., Crusoe spends his time in constructive activity to keep his mindset on survival.
6. Be grateful. In the midst of his misfortune, Crusoe finds a way to look more upon the bright side of my condition, and less upon the dark side, and to consider what I enjoy, rather than what I wanted. He is in distress but has what he needs for survival. What he needs is not a lot, probably less than he thought. Finding a goat and taming it made him happy.
In the melee of uncertainty that is the natural status of bootstrapping, be grateful for what you have. There is no condition so miserable that we cannot find something to be thankful for. Don’t lament about lost opportunities or be too concerned with making the right decision. Embrace the experience and perspectives that comes with your chosen path.
Keep calm. Crusoe often demonstrates the importance of the rule in exception rather than observance. He relates how he first vomited with the great quantity of salt water which was gotten into my stomach, and recovering myself a little, I ran about the shore, wringing my hands, and beating my head and face, exclaiming at my misery. But then he calmed himself, recognising that it was up to him to take control of his direction.
Takeaway: Carry on the journey with positivity and gratitude. Find your inner Crusoe. Think ahead and do what is both useful will give you pleasure – but be mindful of thinking things through. Some of Crusoe’s frustrations are self-inflicted. At one point, he constructs a heavy canoe only to find that. never being able to bring it to the water, was obliged to let it lie where it was, as a memorandum to teach him to be wiser next time.
Bootstrapping is challenging, but it nearly always affords founders a better result. Surveys on why startups fail reveal that funded startups were more likely to run out of money than those bootstrapping, because they were less judicious in their decision making. There is clear evidence that external funding distracts founders. Independence isn’t missed until it’s gone, in the sense that external money dictates your journey. All this may sound like I have a lack of aspiration. I like to call it modest, realistic, achievable and common sense to build a sustainable, profitable venture.
Ultimately, like Crusoe isolated on his island, bootstrapping is making an investment in yourself, by yourself, for yourself, hope is the fuel of progress. Bootstrapping is my preferred minimalistic startup approach, characterised by simplicity, starting a business growing by using limited resources. Other people’s money changes everything, it does for sure help you move faster, but there are high costs to be considered – time, dilution and loss of control.
Don’t obsess over landing investment. Bootstrapping means you are laying the groundwork for growth that is manageable and sustainable. Working solo allows you to refine your own vision for the business, and not be forced to adopt an investor-led agenda. Be eager to learn as you go, and DIY everything you can.
