A Defining Time for Bootstrapping and Survival—Lessons From Business Leaders and Baron Munchausen
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your dollars,” Potashner says. For other things, he advises relying on strategic partners, consultants, and others. Potashner says he also likes to take advantage of technology licensing as much as possible. While he was the CEO of Maxwell Technologies, the San Diego energy device maker, Potashner says he licensed its pulsed power technology to purify water at McDonalds’ restaurants in Mexico and to sterilize intravenous bags for Johnson & Johnson.
—Get Creative. Potashner says when he first took over at Maxwell, the company was a stodgy government contract laboratory “with a big vision and no cash.” When he decided to move the company into a new building, Potashner says he got creative by negotiating a free lease with the new landlord by promising future business. He also negotiated to get exclusive signage on the building and borrowed artwork from La Jolla galleries to decorate the headquarters’ interior.
—Renegotiate. Negotiate with service providers for a lower rate, or see if they will let you pay later, Potashner says. “I think the environment is tough enough that you can get patent attorneys and others to renegotiate their rates,” Potashner says. And it’s worthwhile to take a stab at renegotiating everything from property leases to office supplies. “There is absolutely a lot of flexibility right now.”
Asked what the biggest risk of bootstrapping is, MaxLinear’s Seendripu said it’s merely losing the time spent on a project. “The important thing is not to fixate on an idea,” Seendripu said. “Try to identify what skills you have and what markets you can address.”
As Potashner put it: “Bootstrapping is a choice that’s thrust upon you, rather than one you choose to make. It happens when money is too expensive or just not available.” Potashner later added, “If you’re not living on the edge, you’re taking up too much space.”
As for the literary reference to Baron Munchausen and bootstrapping, I found a reference online from a 1948 edition of the Baron’s tall tale from the 18th Century:
“…with such violence I fell to the ground that I found myself stunned, and in a hole nine fathoms under the grass, when I recovered, hardly knowing how to get out again. Looking down, I observed that I had on a pair of boots with exceptionally sturdy straps. Grasping them firmly, I pulled with all my might. Soon I had hoist myself to the top and stepped out on terra firma without further ado.”