Sample interview questions: What are your thoughts on bootstrapping versus seeking external investment?
Sample answer:
Bootstrapping
- Pros:
- Retains full ownership and control of the business
- No debt or equity obligations
- Freedom to pivot or adjust strategies without external constraints
- Potential for higher profitability in the long run
- Cons:
- Limited capital availability
- Slower growth potential
- Stresses on personal finances and lifestyle
Seeking External Investment
- Pros:
- Access to larger pools of capital
- Faster growth potential
- Expertise and guidance from investors
- Reduced financial risk for founders
- Cons:
- Loss of ownership and control of a portion of the business
- Debt or equity payments that can strain cash flow
- Potential for conflicts with investors
- Dilution of founder compensation and equity
Considerations for Decision-Making:
- Stage of Business: Early-stage businesses may benefi… Read full answer