Financial Tips for Starting a Business
Starting a business requires money, and getting the desired funding requires startup business owners to have a realistic view of their finances. It is important not to exagerate claims or promises to lure investors in; this is not only dishonest, but it will also not help a startup business to become successful. Three practical tips along these lines are: 1. Be realistic about numbers. Use actual figures and projections to develop a business plan and financial model. Financial predictions are better based on accurate data than on feelings or ideas. 2. Don’t spend more -or less- than you need to. It’s important not to overspend and bounce checks; a startup business run in that way will not make a profit and employees and customers will not wish to be in business with them. However, it is equally important not to underspend. Quality employees and materials cost money, and paying too little for either of these may lead to an inferior company. In other words, you get what you pay for. 3. Clients of startups are special. New companies rarely have many customers or clients, if any. However, that can be used to a startups advantage by making those select few clients feel like they are members of an exclusive club and that they are getting in on a good opportunity at the very beginning. Make the first client feel like the #1 client.