As a startup, cash is everything. It gives you the power to forge forward and get things done. It gives you the ability to pay the people who make great things happen for your business, your team. And it provides you with a sense of security should anything go wrong.
Unfortunately, cash management in the early stages of running a start-up is one of the trickiest parts of business. As a consultant, I see many start-ups that seem to manage cash with no real rhyme or reason. The result can be chaotic and even fiscally dangerous for CEOs — the last thing you want is to have to put your own money on the line to prevent disaster!
While truly diving into the nuances of cash flow as an early-stage start-up owner would take hours, I can share five of the tactical tips I’ve learned along the way when it comes to using your cash wisely and making it last.
Keep your books extremely current. Reconcile them as often as possible so that you can get a sense of whether or not your company is on track to meet important financial goals. Another thing to keep in mind is that the more organised your books are, the better suited you will be if potential investors come along and want to do due diligence before giving you a “yes.”
Business can be wildly unpredictable. It’s always a good idea to have a solid cash reserve on hand in the event that unforeseen circumstances arise. Having some cash saved can also make you feel more secure in running your business and making decisions without having to fear being cleaned out.
As the founder of your startup, you’re most likely used to doing it all and wearing many hats within the business. But I’m here to tell you that if there’s one thing you should leave to the experts, it’s your finances. No matter how great you are with money, having a professional CFO or accountant on board is a surefire way to guarantee that your business finances are being handled with care.
Minimizing the money you spend on everything from office space to the number of software subscriptions you forgot to cancel after the free trial ended will make a big difference in the long run. Being able to prioritise what you NEED to move the business forward versus what’s ‘nice to have’ (like a swanky office space or top-of-the-line computer) can be the fine line between business success and financial disarray.
As an expert business consultant, I can help you create a financial plan that makes sense for your business and guide you through how to implement it successfully. For more help figuring out where to spend and where to save in the early stages of your start-up, click here to learn more about scheduling a 90 minute intensive with me.