Connect with us

Featured

5 financial tips to keep your new business afloat

Starting a company often feels like a gamble, but a lot more is within your control than you might think.

Published

on

5 financial tips to keep your new business afloat

When you start a garden, you plant seeds in the ground, water them and hope for the best. You cant control the weather, and you cant stop the many insects and animals that might try to disrupt your garden; all you can do is plant your seeds, tend to them and hope they grow.

In some ways, starting a company is like planting a garden. The economy is sort of like the weather, as its changes are totally out of your control. On the other hand, there are a few things that you are absolutely able to influence.

Among the things that you can change and control, the biggest is your company’s finances. In entrepreneurship, managing finances successfully is as important to growth as water is to a garden.

If youd like your startup to bloom as beautifully as the Gardens of Versailles, follow the top five financial tips for startups below:

Build a budget

Theres a known fact about startups thats hard for many entrepreneurs to stomach: 90 percent of startups fail. A variety of issues can lead to this outcome, but one of the most common fatal mistakes is having an insufficient budget. Many new business owners underestimate how much money they will need for their startup, and this misconception often forces them to stop operating before they have a fair chance to succeed.

To avoid this issue, entrepreneurs can create a realistic budget before they start their companies. During the planning process, upcoming business owners should also budget for their personal lives. It often takes months or years for a startup to start making money, so entrepreneurs need to build their salaries into their budgets.

Understand your credit

When a business first starts out, it has no credit history. Therefore, the credit history of the entrepreneur stands in its place. If you have a 690 credit score, youll be able to avoid the poor personal credit history stumbling block that often delays other entrepreneurs. Alternatively, if youre an entrepreneur that has a poor personal credit history, you can work with a credit repair company (or engage in some do-it-yourself credit repair) to improve your history.

Focus on cash flow

If you do not track where every single dollar is coming from and where its going, your startup will run into financial trouble. One of the best tips for startup survival is to meticulously pay attention to cash flow. If you have a strong understanding of exactly how the cash is moving in your startup, youll be better equipped to stick to your budget and position yourself for positive cash flow.

Remember, time is money

Entrepreneurs are forced to wear many hats at one time. Due to this requirement, its easy for them to forget that they still canand shouldbe protective of their time. If you start your own company, youll be stressed for time, and giving away the little extra time you do have will be a big mistake.

5 financial tips to keep your new business afloat

Every moment of your time has a monetary value. (Source)

You might feel like you cant say no as an entrepreneur, but before you agree to anything, understand that every moment of your time has a monetary value. With this mindset, youll be able to only agree to opportunities thatll help you improve yourself and/or your business.

Work with a mentor

If you speak with an entrepreneurship expert, theyll tell you that one of the top tips to startup survival is to find a mentor. These seasoned individuals are experts at running new companies, and they provide the guidance and advice thats needed to keep entrepreneurs going through the ups and downs of starting a company.

A “pro-tip” to finding a great mentor is to select someone that has strengths different than your own. This way, youll have the best guidance in the areas that plague you the most, enabling you to overcome them with proficiency.

Starting a company often feels like a gamble, but a lot more is within your control than you might think. More specifically, your companys money—and how its managed—is within your control. As long as you take the time to implement the tips above, youll be well on your way to running a successful company thats sure to produce fruit.

SEE ALSO  'Doctor Who' news: Jodie Whittaker revealed as the first female Doctor

DISCLAIMER: This article expresses my own ideas and opinions. Any information I have shared are from sources that I believe to be reliable and accurate. I did not receive any financial compensation in writing this post, nor do I own any shares in any company I’ve mentioned. I encourage any reader to do their own diligent research first before making any investment decisions.

Lucas Miller is freelance blogger, direct response copywriter and content marketer at Echelon Copy. When he’s not reading, writing or fiddling around on the Internet, he enjoys spending an hour or two on lengthy runs in the mountains near his home in Provo, Utah.

Continue Reading
Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

Most Popular