Photo: Marvin Meyer / Unsplash
Startups tend to be vulnerable in the early stages of their journey, making every dollar you spend important. The great news is that with the art of bootstrapping, you can successfully launch your business with very little money. The six tips below are an easy and effective place to start:
- Avoid Wasteful Costs
Some startup expenses – like legal advice, market research, marketing, and branding – are essential. However, some are definitely not essential, such as fancy offices, costly corporate outfits, lots of staff, and fancy business cards.
Instead of spending frivolously on things that look good but lack substance, put the bulk of your money into the essentials. For the rest, make savvy workarounds. For example, opt for self storage instead of warehouse storage, virtual office addresses instead of a physical office lease, and freelancers rather than full-time staff. These and other workarounds can help you funnel money into the right areas of your fledgling business.
- Focus on Excellent Customer Service
According to a recent survey published in Forbes, around 96% of customers will stop using a business because of bad customer service. As a startup on a shoestring budget, you can make a lot of progress on very little money by focusing on good customer service. Using social media, engaging with customers, being polite, helpful, and kind – these are easy ways to garner business growth on very little money.
- Create a Business Plan
A staggering 9 out of 10 startups fail, and one common reason for this is an insufficient business plan. To avoid this pitfall, develop a roadmap for your business that highlights all your goals, funding sources, market research, risks, and more. By putting the time into a detailed business plan, you’ll give yourself a better chance at reaching your goals and avoiding the big financial risks that can sink a vulnerable new business.
- Network
For 78% of startups, networking is essential for success. This is great news for any business operating on a budget because it means you can boost your brand via a range of online and offline avenues, many of which are free.
Networking is about talking to the right people, collaborating, getting to know leaders in your industry, and ultimately making as many connections as you can. Doing so will benefit your growing business, potentially connecting you with investors and fantastic deals on things you do need to spend money on.
- Test Before You Launch
Nearly half of IT startups fail because there is no real need for the product. However, it’s important to recognize this risk as a startup in any industry. The last thing you want is to invest money into an idea that simply won’t work. So instead of going all in, create an MVP (minimum viable product) which is a basic version of what you want to offer. It should solve the problem you want to address in the most efficient way. This will protect your capital and help you get quick feedback as to whether or not this startup in its current form is viable.
- Stay Focused
Monitor your cash flow and invest in professional advice to help you master those areas of business you don’t have the expertise to handle alone. Successful startup owners are aware of where every dollar is being spent, so they have plenty of time to act on potential risks and opportunities for investment.
By embracing the insights above and maintaining resilience and passion for your venture, you can make yourself part of the esteemed 10% of startups that not only survive a decade after starting but flourish far beyond expectations.