Bootstrapped Businesses Eager for 2013 Growth
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Despite lingering economic uncertainty, the majority of bootstrapped companies are optimistic about what 2013 has in store for them, new research shows.
In fact, 65 percent of bootstrapped businesses — those that have been started with little outside capital — anticipate higher growth than last year. However, that's down from 87 percent last year, the study by growth equity firm Mansail Partners shows.
The drop was attributed to the slower-than-expected economic recovery, combined with ongoing uncertainty in the macro-business environment.
Overall, nearly 42 percent of the bootstrapped executives surveyed think the U.S. economy will perform better this year than last, compared with 26 percent who expect it to fare worse.
"We think bootstrapped companies are an especially insightful barometer on economic trends, since their sharp focus on profitability makes them more sensitive to economic headwinds and changes in the business environment," said Gavin Turner, a Mainsail co-founder and managing partner. "So we're heartened by the optimism expressed by our respondents — although we believe the results also reflect some concern about broader macro-economic volatility."
The general optimism is leading many bootstrapped businesses to consider adding new employees in the year ahead, with more than half of those surveyed expecting to hire more people this year than last year.
The research revealed that finding those employees is the top challenge bootstrapped executives face this year, with nearly half saying finding qualified candidates is their biggest obstacle. Other challenges they expect to deal with in 2013 include not having enough capital and paying for increased operating expenses.
With the money they do have, bootstrapped companies plan to invest most heavily in product development, sales, marketing and public relations this year.
The study was based on surveys of 500 executives from bootstrapped companies.