Deciding to be a startup entrepreneur can be an exciting adventure but it can also be a little scary, particularly when it comes to your finances. If you’re like most startups, you have a limited budget and want to save money whenever possible.
One of the many reasons that startups fail is because of poor money management or simply running out of cash flow. Nearly 30 percent of startups run into money problems but you don’t need to become another statistic.
Here are some money saving tips whether your startup is a few months or a few years old.
Don’t Mix Business With Pleasure
Your startup, without a doubt, is a part of you and you probably spend every waking moment trying to find ways to keep your new business a success. Many startup entrepreneurs make the common and seemingly harmless mistake of dipping into their personal finances to pay for business costs.
Mixing your business and personal finances is a recipe for disaster. Not only can it get unorganized (particularly at tax time) but eventually you won’t have a clear idea of how much money your business is making.
Use Free Online Tools
Not ready to hire someone to do your payroll or don’t want to pay for expensive software and other services? The Internet is full of valuable online tools and many of them are free (just make sure you read the fine print to find out if they are really “free”). Some tools offer free trials, which can be great if you’re interested in buying.
An can help you determine if the return on your investment is good; if not, you can get guidance on how to make improvements. Analytic tools, such as Google Analytics can help you find out your visibility on the Internet and ways to improve.
As a startup, it’s important that any information that’s published on the Internet is as accurate and positive as possible. Updating your business page on sites like Yelp can help stay connected with potential customers as well as do some free advertising.
Be Frugal Yet Fair With Employees
If you have a team of employees who believe in your startup and have followed you from the very beginning, you want to treat them well (and they deserve it, too). It may be tempting to spend a lot of money on your employees and giving them a huge benefit package.
Being frugal yet fair to your employees can get a little tricky. You should pay them well but offer the basic benefits, particularly in the early years of your startup. There are other ways to show your employees that you care and appreciate them without depleting your finances.
Pay for lunch a few times a month or invest in a coffee cart for the office. Offer a paid Friday off a few times a month or let your employees pick and choose their benefits. Get creative with keeping costs low but always let your employees know that they are valuable.