There are habits that you end up cultivating at the start of your business, that eventually don’t leave you. Startup founders therefore should begin with inculcating some basic rules to run their business. These rules often help them in better finance management leading to the growth of their business.
We bring you three such tips that don’t look like finance tips to start with. However, they have a real impact on your business finance.
#1. Good at something? Don’t do it for free
Startup founders often find it fulfilling to have conversations with other entrepreneurs about various issues. As long as it’s an exchange of knowledge, information and resources, it’s a win-win. But if you are giving away your time for nothing in exchange, you are practically losing money. How many times have you got yourself involved with a client issue which is not yours? If some of your clients have taken so much of your time that it qualifies in ‘consulting’, you should have charged for it. Giving away your time for free is almost like doing a free distribution of your service or product. If you are not getting any real value for this consultation, discussion or talk, you must stop immediately.
# 2. It’s okay to start small
Don’t get too bogged down by limited capital at the start of your company. Flipkart founders started with selling books and at the time, they used to wrap those books themselves before sending it to courier services. Eventually such factors impressed the investors along with their valuation that got them their first round of funding. Set examples of doing smart business, save costs when you can and charge for extra services where it’s due. These little factors play a big role in giving the investors the confidence that you know how to put their money to good use.
# 3. Investors invest in the pilot, not the plane
It’s your leadership and management skills with the available resources that would eventually get your investor’s money. Investors need to know that you have the ability to manage finances well, keep things within budget and increase or decrease marketing costs as the situation demands. As a founder, you should know how to tell your story well. Be very clear about the exact pain point you are addressing. Articulate well about your solution or the service and how you stand out. Investors are people and if they cannot connect with you as a person, they are not likely to put their faith in your startup.
As you learn to practise these tips, you will soon realize you are able to cut your costs and earn reasonable profits for your business. For more finance tips, stay tuned to Giddh. If you need help with automated finance management, call us.