3 Financial Tips For Startups & Small Business Owners

Tips For Startups & Small Business Owners

As a small business owner, your thoughts are consumed by the status of your startup. Through the flurry of ideas, feelings, hopes, and dreams, one thing stands out at the forefront of your mind: money. Regardless of your product, service, or industry, your finances determine how — and even if — you can achieve your goals.

When your strengths lie elsewhere, managing your startup’s finances can pose a challenge. It’s a herculean task. It may take all of your fiscal concentration, and your personal finances — which were once stable and dependable — can suffer from a lack of attention. If money management is not a skill you can claim, follow this short guide to help you keep on top of your finances and save money where you can.

Consider hiring an expert

Your business might not be large enough to justify hiring a Chief Financial Officer just yet, but outsourcing your accounting to a professional can help take the sting out of managing your finances on your own. A small business accountant or experienced auditor will track the comings and goings of your finances, freeing you up to focus on your day-to-day operations.

The extra expense in payroll is worth it when they can keep your records organized immaculately. Not only will you always know where your finances sit, you’ll also be in a better position should you be audited come tax time. A professional can highlight problem areas they see in your budget, alerting you of cash flow mistakes early on before they can compound into a larger issue down the line.

Investigate online lending opportunities

At the very start of your business’ life the boundary between personal and professional is still a little blurry. You’re always the last one to get paid, and you may dip into personal savings to help things along. While a traditional loan, venture capitalist, or angel investor is a great way to get your startup off the ground, these aren’t always the right solutions to your personal cash flow problems.

When your business needs take over, it’s easy to forget the timing of important monthly payments, like your utility bills or your mortgage payments. You may use personal savings to help cover business costs, only to realize you needed those funds to pay for costs like car repairs and essential medication.

If you’ve blurred the lines between your professional and personal finances like this, then a short term personal loan from an online lender like MoneyKey may help re-establish boundaries. Due to a convenient online process, they provide an easier and faster way to secure cash via a personal loan, so they’re ideal for when short-term bills and other necessary purchases need immediate attention. Note that these types of personal lenders do not offer business loans, so make sure to do your homework and understand that you are in fact applying for a personal loan to help cover personal expenses.

On the other end of the online lending spectrum is crowdfunding. Thanks to online platforms like Kickstarter and GoFundMe, many entrepreneurs typically locked out by traditional lenders can fundraise the money they need online. Without the need for applications or pitch meetings, it can be an easier way to collect funds for those without substantial financial histories. Some crowdfunding campaigns are incredibly successful. The Pebble E-Paper Watch raised over $10 million in just 37 days.

Make smart purchases

You have to spend money to make money, but that doesn’t mean you always have to pay full price in order to get the goods and services your startup needs. Consider all of your options before you lock-in on a purchase. There are opportunities to negotiate a vendor’s terms or prices, especially if you’ve had the time to build a mutually beneficial business relationship.

Until that happens, research how you can cut costs without sacrificing quality. You can reduce unnecessary expenses by searching out pre-owned equipment, tech, or furniture. Don’t hesitate to take advantage of coupons and rebates when making purchases. Despite what you might think, you won’t have to waste hours trawling through fliers and online databases. With the right app, you can get sent relevant deals and promotions right to your phone.

Though you may have a brilliant plan for a niche service or product, your startup’s finances could keep you from ever offering these things to your customers. Don’t let poor money management hurt your potential — personally or professionally. Use this guide to help you keep on top of your finances.