Pinstripe Suits, a Merc in the porch and month long vacations in the Caribbean. It’s almost certain that every single person who has stepped into Entrepreneurship might have atleast once thought of living such a life.
And though many do reach that prospect, it’s not overnight success.
It takes a brave person to start a venture on his own and an even braver person to keep it going. Sleepless nights, tight deadlines, living off on caffeine and adopting stress as your middle name; all happen to a startup entrepreneur at one point of time or the other. Finance is hard to come by and each penny knows its worth the way it rolls.
Depending on the industry, breaking even of revenue may take time or might happen from the first project forth. Growth may reach a negative stage at one point or might even flat-line. All these are part of the game. A game, which is nothing less than an intelligent gamble.
All gambles have money involved and same story goes true for startups. It is important to handle money carefully and not get carried away in the Silicon Valley stories of Opulent Offices, Tantalizing Takeovers, Avaricious Acquisitions and End-of-the-line Exits. One needs to keep track of the expenses and ensure to cut it down at all angles possible.
Its not about how much you make, but about how much you can keep.
1. Take up an Office Space only when its necessary – If you have loads of clients walking in and feel the need to have an office space, along with the finance to back it, only then go for it. Else, its just a luxury.
2. Don’t waste money initially on unwanted furniture and logistics
3. Don’t recruit immediately – You’ll anyways have to don a number of hats, so test your limits. Only when there are things which you absolutely cannot do, then hire.
4. Opt for Second Hand Items – A lot many things which you might need in your startup can be bought second hand – furniture, monitor, bean bags etc. A good deal of research should bag you good stuff at affordable prices.
5. Ask for free advice – You’ll definitely be networking around. So whether it be a professional contact or your Chartered Accountant, no harm in asking if they’d provide free advice. If its a no, fine. Else you get a good deal!
6. Use Open Source/Free Tools – Ranging from Dropbox/Google Drive for cloud storage, to Google Docs for collaborative work, to GNUcash to handle your accounting; there are a zillion free tools of all sorts to help you in your day to day activity of running the startup. Utilize them instead of jumping for paid ones.
7. Travel only when necessary – Travel forms a major part of the expense for a start-up. For the first round of talks with a client, in order to get a gist of the deal, have a meeting over Skype or Phone (Depending on your type of business, choose the best option: no travel/travel meagerly). This will let you understand the seriousness of the client in the deal and help you avoid incur unnecessary travel costs.
8. Utilize Social Media Marketing – Marketing is definitely necessary to spread word about your start-up. With internet as the major tool at your fingertips, utilize the power of Social Media to reach out.
9. Overuse the local library – Its necessary that a Start-up Entrepreneur reads a lot. And books are costly to come buy. So utilize the Local Library to the best possible means. Am sure you wouldn’t be disappointed.
If the local library isn’t a great one, try contacting local book clubs/associations or even Coffee Shops which nowadays house a range of books.
10. Have a network of freelancers – to help you out in cases when you need professional help with your work when overloaded. Still, I’d say try keeping as much work in-house as possible in the initial stages.
11. Try out barter system with other Start-ups – It works well and is mutually beneficial. I do that for my firm. We take care of design and content needs of one of our partnered start-ups and in return they help us with website and other technical requirements. Win-Win for both!
12. Delegate time well – If you learn to plan your time well, that itself in many aspects will make your work more efficient and hence cut down on your costs.
P.S. Thanks to my friend Arif for pointing out a slight correction in one of the above points.
Image Courtesy : cloudfront.net, smallbiztrends.com