> [!AI]+ > A bootstrapped business is a business that is started and grown using only personal finances or the operating revenues of the new company. This means the entrepreneur does not use external funding sources like venture capital or angel investments. Instead, they rely on their own savings, reinvesting profits, or other non-traditional ways to fund their business. I'm inspired by [obsidian.md](https://obsidian.md/) as a business -- I think it would be great for the world if more companies could be small businesses with highly aligned values and a stronger decoupling from capitalism. # What makes bootstrapped businesses work? ## My (working) hypotheses: ### Product / Market Fit You have to find something that is intentionally small so that you can't be out-competed by scaling. This means finding an intentionally niche customer segment that can't sustain a $1B business. VC funded companies will bounce off in search of bigger markets. ### Positioning / Dividing Lines / Values Sometimes you can segment a larger market by having clear values that segment the market. This means that you can focus on one half and build a superior product that one that tried to cater to both. Thus, if you want to build a bootstrapped business, you need to [[be opinionated]] and [[exercise taste]].