Selective Bootstrapping Strategy

Andrew Wilkinson shares insights about bootstrapping businesses, particularly agencies, and how to approach growth and hiring. He emphasizes capital efficiency and selective scaling based on business type and personal preferences.

Key Points:

• Starting an Agency is Capital Efficient:

  • Young entrepreneurs only need enough money to live for a year
  • Can hire just-in-time for contracts
  • No office needed in modern times
  • Avoid expensive offices which are a common mistake for agencies

• Growth and Management Philosophy:

  • Personal sweet spot is 15-20 people for direct management
  • Beyond that size, transition to CEO leadership
  • Now meets with CEOs once yearly, with as-needed check-ins
  • Early agency work is "exhilarating" - gives access to high-level meetings and clients

• Hiring and Delegation Strategy:

  • Only hire when you have budget for 2+ more people
  • Complete delegation to trusted leaders
  • Makes only two key decisions:
    • Who runs it
    • How they're incentivized

• Incentive Structures:

  • No one-size-fits-all approach
  • Different motivators for different people:
    • Some want partner title and equity
    • Others prefer performance-based targets
  • Example structures:
    • 5% of growth above 15% baseline
    • Stock price milestone payments

• Business Evolution:

  • Prefers "base hits" over complex ventures
  • Learned to avoid "10-foot hurdles" in favor of "1-foot hurdles"
  • Pattern matching helps identify what works and what to avoid
  • Takes "15 years" to develop this business insight