Big companies have better distribution, access to money whenever it is needed, a brand that customers trust, access to the people who buy, and great employees. They have lots of competition, big and small, and they have sharpened their axes for battle.
As a bootstrapper what is your advantage?
You have nothing to lose.
This is huge. Your biggest advantage: Nothing to lose.
Big, established companies are in love with old, established ways. They have employees with a huge stake in maintaining the status quo.
How many of the great rail companies got into the airline business? Zero. Even though they could have completely owned this new mode of transport, they were too busy protecting their old turf to grab new turf.
Whenever a market or a technology changes, there is a huge opportunity for new businesses.
The challenge with big businesses is that they always slow to adjust to changes in the market because they have to be extra cautious because they have something to lose.
The bigger you get, the small the margin of error becomes.
Big businesses’s investors and employees want stability, more years like the one they iust finished. They do not want to hear about investing in new markets. They want to hear about profits. So they do more of the same.
A few years later, they out of business.
Elephants don’t turn, well they do, but very slowly.
When I was at business school, we had to interview an entrepreneur as part of an assignment. I spoke to an entrepreneur who was in the printing business. His business premises were next to a big printing business.
When I asked him how he managed to compete with the big business next door, he said, the big brother’s machines next door are set up to print big batches. If you want smaller print jobs, to set up their gigantic machines to print smaller job was not cost effective for big brother, and this is where he came in because he was able to execute small printing requests.
In fact he got most of his business from big brother next door because big brother, like an elephant couldn’t turn.
The big do not always eat the small but the fast always eat the slow.
Like elephants, big businesses takes time to turn and seize opportunities, therefore as a small start-up entrepreneur your ability to adopt changing environments is far quicker that big established businesses.
The bankruptcy of Kodak, a big established company is proof that the big do not eat the small but the fast always eat the slow.
Strap your boots to think fast, to decide fast, to operate fast and to move fast.