November 14, 2016
There’s probably no tougher time than when you’re beginning a startup. Money and time are especially tight at this stage. The work is never ending as you try to get your product off the ground.
On top of those concerns, there’s always that nagging doubt over whether you’re doing the right thing. These are all totally normal problems that every startup — even the super successful ones — have gone through at one point.
There are only so many hours in the day, as anybody in a startup knows, so there’s not much to be done about saving time. Money, however, is a far different resource. There are ways for any startup to save money when they’re in their earliest and leanest stages.
Saving money, even a little bit at a time, goes a long way in making a startup sustainable. If you’re wondering how to stop burning through resources, you’ll want to follow these three strategies:
1. Don’t Buy New Unless You Have to, and Trade If You Can
Stocking up on new equipment, whether it’s machinery, computers or just about anything else, is especially challenging in the earliest days of a startup. Instead of buying new, it’s almost always a better idea to go second-hand or upgrade your current equipment when you’re trying to get your business off the ground. While the equipment might not have the satisfying “new” feeling, second-hand goods will be considerably cheaper and are often at least as good as a brand new version.
Scour website listings and check your contacts for leads. If you do your research right, you will likely find items that suit your needs perfectly.
Alternatively, you can even try bartering your services in exchange for other services or equipment. This isn’t uncommon, as some startups have an unused capacity that other businesses could benefit from. Maybe you’re an exceptional bookkeeper who can help out, or perhaps you have top-notch programming skills. Whatever it is, you can use those skills to save money and help out a fellow business owner.
2. Turn to the Gig Economy If Needed
Money can be your best friend or biggest enemy when at a startup. To earn some extra cash on your own time, consider the gig economy. Time is no doubt tight, but there are a number of micro-job sites out there where you can put your skills to use.
Helping out with some coding, for instance, won’t make you rich or solve all your financial troubles. It does, however, help stretch out your money so it can last longer than it otherwise would.
If you’re starting off in the gig economy, keep close records of the time you spend and the money you earn to see if the jobs are worth your time. In some cases, the money isn’t worth the time. If you play your cards right, however, then you can earn a decent amount of money.
3. Know the Most Important Numbers
Data is totally underrated as an asset, even though it’s one of the most valuable things a startup has. If you track your data, whether it’s sales, website traffic, engagement, etc., then you can make smart decisions. The right calls based on the data will make your startup more efficient and ensure you aren’t wasting your resources.
These numbers don’t have to be solely about customers or revenues, either. Knowing internal figures about how your startup is operating can ensure you’re investing in the right places. For example, businesses report that 74 percent of ongoing client communication is done by phone. If that figure applies to you as well, then you’ll be able to come to a sound decision about what kind of communication system to use.
Getting Into Good Habits
There are so many things to stress about at a startup, but developing good financial habits will lessen those stresses. Follow these practices, and you’ll find your startup in a strong position.
Image by iDriss Fettoul