The traditional VC model funds a risky search for product-market fit, argues guest author Richard de Silva of Lateral Investment Management, while bootstrapped founders typically start with known customer problems, prioritize profitability and grow steadily from revenue rather than outside capital.

In Silicon Valley, if a founder wants to build the next unicorn, there's a formula: find a bold idea, surround yourself with well-heeled advisers and investors, and raise a war chest. With cash and fundraising buzz, go after a large market in search of product-market fit. That journey sometimes leads to winning pilots, more rounds and real customers. More often, the company pivots into a different niche or quietly dissolves.

The more common path is bootstrapped or self-funded: Start with an existing customer problem and get paid more than it costs to solve it. For entrepreneurs without the luxury of risk capital, product-market fit can't be an odyssey. It has to be a starting point. Much of the global economy has been built this way.

Customer-focused and experienced founders ask VC-backed founders how they built their company, and you'll hear about the team and investors first. Bootstrapped founders tell it in reverse: the customer comes first, and the team is built around them. Consider Atlassian and Basecamp. For every VC-backed startup, there are hundreds of bootstrapped founders building profitable businesses without any outside investment.