The Modern Startup Gambler: Knowing When to Hold Em’ and When to Fold Em’
Welcome to the world of modern startup business finances, where we strive to be successful and roll in those benjamins (or any currency of your choice, really).
Financial success and freedom can be daunting for a budding entrepreneur – what steps can you take to be sure you and your staff are covered and cash is flowing?
Before you start making it rain, keep these tips in mind and be closer to achieving your startup's financial goals.
End in sight
It may seem counterproductive to begin at the end but stick with us here. As a business owner, an entrepreneur, a wizard of innovation – you must always have the end goal in sight.
Picture yourself lounging on a beach, sipping cocktails while your business thrives. Now that's motivation! But to get there, you need to budget around that goal. Every dollar counts, so make sure your spending aligns with your ultimate vision of where you hope your product and business end up in the market.
Long term strategic plans will help you with this – accountability on a daily basis can be hard but make it easier on yourself and have that end goal at the forefront of your decision making and allocate your resources wisely and you may even be able to smell that ocean air with each step.
Knowing your profit split is crucial. It's like knowing who gets the biggest slice of cake at a birthday party – except in this case, it's all about money.
Make sure everyone involved understands their fair share and is motivated to work towards increasing those numbers.
Knowing what that magic break even number is is less about magic and more about analyzing and assessing – two words that might sound boring but trust me, they're crucial for financial success.
Take a deep dive into your numbers, scrutinize every expense, and find ways to optimize.
Importance of Cash flow
Cash Flow is king!
You might have heard this phrase before, but it holds true for startups too. Keep an eye on your cash flow – money coming in versus money going out – because without cash flow management, even the most promising businesses can find themselves drowning in financial woes.
How long can you keep going before you run out of money? Don't panic though; just be aware of how much runway you have left so you can plan accordingly.
And finally, once you've mastered all these financial shenanigans, you can thrive!
Remember: It's not just about making money; it's about building something amazing while having some fun along the way. So go forth and conquer those finances like the financial wizard I know you can be!
Buckle up and get ready to conquer the financial challenges that come with running a startup because success awaits those who play their cards right (and maybe even wear a lucky pair of socks).
Based on Excerpts of the Biz/Dev Podcast Episode 99.