Want to Start a Business? Here's 7 Financial Tips For Success
You will need all of the guidelines you can get when it comes to starting a business today. The following 7 guidelines are necessary and crucial to financially securing your business long before you open the doors.
- Do plan to start with your own money, not someone else's. The money to start your business will come from your right or left pocket. In fact, there are three pools of money you should have before your start a business: an emergency savings account, enough budget to go from 12 to 24 months without a paycheck, and the first year of operating capital to run your business.
- Do request major funding long before you need it. Maybe you recently saw The Social Network, the movie about the launch of Facebook, and thought that you could score big dollars fast from venture capitalists? Think again. Realize that getting money from VCs and angel investors can be a longer-than-expected process, sometimes 6 to 12 months to secure.
- Do seek "trade credit" from vendors and suppliers. Too many entrepreneurs dream of going to a bank and getting a business loan or line of credit for their enterprise. But maybe you don’t need a traditional bank loan at all to launch or grow your business. If you can get your vendors and suppliers to agree to provide you with trade credit—i.e., the ability to pay for goods and services over time—you can creatively and more frugally run your operations.
- Do get buy-in from your spouse/partner. Many new (and veteran) entrepreneurs will tell you one of the biggest dream killers they’ve encountered is an un-supportive spouse. Make sure your partner is on board with your entrepreneurial ambitions. If not, you'll face a host of financial arguments and money-battles that will be counter-productive to you building a business and to your relationship. Read more here.
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