Going from full-time employment to chase your dream is a very liberating experience.
You have dreamed of this day for so long, the freedom of not having to clock in and clock out on an emotional level as well as physical.
Running your own business or working with a business partner brings a peace of mind in one respect. On the other hand, it actually means working long(er) hours, giving a lot more dedication than you ever did in your usual job, and making many different sacrifices.
You may have to sacrifice family time or finances to get that website set up on time. You will see that running a business is a completely different beast to the 9 to 5 slog, but you already knew that, didn’t you?
Never fear! There are ways to keep your finances (and your sanity) in check.
Yes, it does.
A number of small companies or startups that are in circulation in the world now means that there is a small window of opportunity to get your business to compete with the bigger businesses.
The marketing and allies you acquire on the way will be very important to you in the long run. But what can you do to get the capital behind you at the start?
You can get advice from Top Fee Only Financial Advisors, but some of the basics are laid out here.
A Start Up Loan
This is a typical method of getting money behind you at the start. If your business is up to two years old, you are generally eligible for a start-up loan. You can get quite a large amount at the start to cover your overheads.
This could be your savior. Business angels are generally entrepreneurs so they will have an understanding of your position.
When it comes to actually pitching to a business angel, it is a lot less stressful than your standard business pitch. If you are happy to give up a share of your company in return for investment by an angel, this could be the best route.
The way this works is that a piece of your own equipment is used as collateral. A lender will fund the amount that the specific piece of equipment is worth.
If you are running a farm business or a large operation, this is worth it. But if you do not have much machinery, it might be worth passing over.
If you have custom or clients but they’re not paying, this can really put the stressors on your company. If you have invoices to pay right at the beginning, having a cash advance will help a lot.
The way this works is that the financier will purchase a fixed percentage of future card transactions, in return for putting the money into your account. It is usually within 10 working days. The repayments are a percentage of each transaction, which is usually around 10% to 20%.
This way you can plan ahead financially while also having enough behind you to push the business forward.
Peer To Peer Loans
This is where a peer to peer site puts you in touch with private money lenders. The benefits of this are that a more hands-on approach is implemented, and a personal relationship can be developed.
So if you are able to negotiate terms or funds personally, this could possibly aid you in getting more funding.
A more left field approach of raising your money, yet all manners of companies will go down this route. From tiny startups to independent filmmakers and everything in between.
Having a great pitch and asking for a donation, however small, in return for a small token of your appreciation, can be a great way to earn your money very quickly.
… AND BUSINESS WALKS
Getting ahead of the business curve while maintaining your finances will prove to be a struggle in the interim. You need to be aware that it is a short-term problem.
There are things that you can do to help your business image, and these can be very minimal costs that can have a maximum impact on the company.
Hire A Virtual Assistant
Virtual assistants come in many different shapes and sizes. If you have a small business without a stable location, you can book meeting spaces for the important meetings.
Or you could set up a mailbox for all correspondence to go to. Doing this over having mail go to your residential address will give you that more professional image. Virtual office services can also provide you with phone receptionists to “hold the line,” which will give your business that image it needs.
Investing in the right systems to either help your back-office functions work more seamlessly, or forking out for equipment like a VoIP phone will be a cost upfront, but these systems will work so well to minimize business issues, you won’t know what you did before you had them.
It is dangerous to think that small tasks are insignificant in the long run, but these can be the ones that are either overlooked or shoved aside for more pressing tasks.
Getting a back-office system in place will help make these things less of a niggling thought in the back of your mind.
Seek Guidance From Businesses That Were Once In Your Shoes
People will naturally choose careers using skills they are gifted in.
If you are setting out on a venture where you may think you know all there is to know, and you will have researched meticulously, but there are always people that have been in your shoes and made mistakes. While you cannot avoid mistakes, it is worth getting advice from people in your industry.
Whether you take that advice on board is up to you, but these people have been there and can warn you about certain market trends or mistakes that are all too common.
Finances in business is a plethora of forms and problems that can be overall quite overwhelming. Having the know-how before you go into business is the best preventative measure.
So what methods are you using to keep your business financial sound? Share your thoughts in the comments below.