BLACK COCKTALE

JAMES BAKER...Ceo of Dragon Systems
You don't need an MBA to be an entrepreneur

You are absolutely right.  You don't need an MBA to be an entrepreneur.  In fact, an MBA is not very useful in the early stages of a startup.  Real world business experience is more useful.  Prior experience founding a startup is much more useful.

The short answer to your "Why" question is that most people have no interest in being entrepreneurs and/or they are afraid to take the risk.  They take too narrow a view of the opportunities of bootstrapping and don't know how to reduce the risks. If you want a career leading to an executive position in a large company, then an MBA will be useful.  It might even be a good investment.

They look at the glamorous startups that have billion dollar IPOs and think "I could never do that" or "That would take millions of dollars just to get started."  They also correctly think that most startup strategies have high risk, which is also something that should concern you. 

You already have a very different view, starting with $60K and planning to start while still employed. 

So let's change the question: "Why not bootstrap?" or, better yet,

"How can I bootstrap with only $60K and minimize the risk?"

Create a golden bootstrap.  I introduced the phrase "golden bootstrap" so I get to define it.  A golden bootstrap has the following characteristics:

A golden bootstrap company follows the golden rule as a fundamental principleAll co-founders get equity proportional to the amount of sweat equity they contributeThe company provides value to customers; it strives to satisfy customer needs and wants and to provide quality products and service at an attractive value propositionThe company makes decisions to maximize its probability of survival, rather than the probability of becoming a billion dollar companyThere is a bootstrap stage during which all the co-founders contribute sweat equity; during this stage some or all of the founders may still be employed and may be only working for the startup part-timeThere is at least one co-founder who makes a financial investment at the founding (This is not true for most pure bootstraps.)Generating revenue takes priority over raising funds from investorsThe company gets to positive cash flow as quickly as possible and takes all reasonable measures to maintain positive cash flowFounders' salaries are delayed and limited by the constraint of positive cash flow; the difference between a founder's market rate salary and the actual salary received is sweat equityHiring of new employees and other incremental expenses are limited by this constraintIf necessary, steps are taken to reduce expenses, including down sizingThe company accepts outside investment only under terms and conditions that are consistent with the company's philosophy and that enhance the company's ability to meet is goalsThe company accepts outside investment only if the expected return to existing stakeholders is increased even after discounting for dilution and the increased risk of a more aggressive growth strategy

Note that a golden bootstrap allows, but does not require, founders to stay employed and to only work for the startup part-time.  That is my advice if you and your co-founders want to minimize your financial risk.  You have said you want to do that.  Encourage all your co-founders to do the same.  That leverages your modest $60K initial investment, rather than using it up paying co-founders' salaries.

Working only part-time is not the standard advice, and it is not my advice if you want to minimize the time to some key milestone, such as getting to an MVP and raising a substantial amount of angel investment.  For example, working full-time from the start is the right strategy if you have an idea that has limited time value and if there is a big advantage to being first to market.

However, as an answer to your question, a golden bootstrap is aimed at enabling you to become an entrepreneur while minimizing the risk.  Taking more time and keeping expenses as low as possible until there is positive cash flow minimizes the risk of the company running out of money.  Once the company is self-sufficient, it has an unbounded runway.  It is not in a constant race to get the next round of funding.  I think starting part-time is the best strategy in your circumstances.