A good idea and a good team can get investment from Angel Investors, Venure Capitalists, and Banks. However- I would recommend to 99% of web entrepreneurs out there that you personally fund the first phase of your website. That means bootstrapping: or relying on your own bank account (or that of friends and family) to pay for the initial phase of your web company. Below are my reasons.

1. Most Phase 1 or Prototype sites an be built for $1k - $5k.

If that’s outside of your price range; ask people around you. Get friends and family excited; get them involved. If you can’t sell your family and friends on the idea; perhaps the idea needs rethinking.

2. Bootstrapping shows commitment

If this is your first web company; bootstrapping the first iteration of your site shows all future investors that you are competent enough in developing a product and bringing it to market. The first version does not need to be perfect; but it shows that you are committed.

3. You can start it now

I know a lot of people who waste 10 years of their lives chasing investors; and without a product to show for it. Smart bootstrapping will give you a product in less than 6 months; and you might even see revenue in the same year. Start something while you and your team are excited about it.

4. Bootstrapping builds leverage

No investor is going to give you $100k for 5% of your company if you have no product and no revenue. They might put in $10k and expect 50% of your company- since you have nothing (no product) and they have everything (the money). When you have a product, if you have revenue- you get more investment for less equity. That’s leverage.

5. Rapid Prototyping

Getting an early iteration of your product to market might just change your perspective on what you are building, and what you are selling. Get something out there. Rapid Prototyping dictates that you rapidly try new versions of your web idea- getting feedback, seeing what works. And after several months of rapid prototyping; your investors will notice the higher quality of your product.

6. Reality Check

In some situations, the only person who is going to invest in your idea is you. Whether that makes you an eccentric visionary or a hero who must prove himself by action: actually making a website will get you the proof of concept- and perhaps revenues- that you need. Ask yourelf- how long have I been thinking about this idea? How many people have offered to invest? They will be more inclined once you put your funds in first.

7. Pressure’s on

Having your own personal funds on the line puts pressure on you to generate revenue fast- and that can be a good thing. I know several entrepreneurs who received funding for their venture and then relaxed; since their necks were no longer on the line. But often it is healthy for an entrepreneur think to himself- I need to sell this, or the rent doesn’t get paid.

8. Would you invest in your own start-up?

If you had $100k, would you invest it in your idea? Sometimes the answer is no; maybe your idea is too risky or the revenues are too delayed for the entrepreneur himself. Now a risk-averse entrepreneur can build a high-risk venture with an ambitious investor- but that’s often unlikely. If you had $100k- where would you invest it?