Zoha Khan

5 Financial Tips to Ensure Smooth Operations at Your Startup First and foremost, we give our tip of the hat if you are someone on the road to launch a startup because it is everything but easy.  Speaking of this, about 92% of the startups miserably failed as per the Startup Genome Report Extra. However, a lot depends on the kinds of strategies you employ and how broad is your spectrum of knowledge where startups are concerned. That being said, with the right approach and attitude, you can build a nice, lucrative business out of your startup in just a matter of few years. One has to be adaptable and welcoming towards change to ensure success. The driving force of a startup is the capital and its reign rests with you. If you know how to handle the finances, then you know how to both survive and thrive. Here in this blog post, we bring you five tips that can help streamline your finance handling for you. Let's get started. Management is the key: The mismanagement of cash flow is one of the prime reasons that takes a startup down the hill. As we discussed earlier, capital is the driving force, it is essential that you know where each penny is coming from and similarly, where each of the penny is flowing out. No matter how good your business plan is, if there is no money then obviously no business could ever be carried out let alone running the operations smoothly. And here, budget is your best friend. It is the foundation block for any business out there looking to get established. How to: Budget: Firstly, you need to figure out your monthly income coupled with the sources and tally them. Following this, you need to determine the fixed costs and the variable expenses. Other than this, try and know what would be your one-time spends such as a computer maybe or could be general office supplies. And voila, pull everything together.  It indeed is hassle but maybe that smart phone you walk with could help you out. There some really cool budgeting applications that can help you in keeping the track. Spend wisely: When you are starting up a business, it is only natural to be consumed by impulsiveness. But you got to keep that control for limiting fixed costs is what will allow you to carry the operations smoothly. Keep in your mind that you need to do the following stuff at the beginning of your journey of the startup: - say no to a fancy office right in the centre of the city -try and cut back on rent - top notch amenities; a big fat NO - say no to full-fledge three-time meals; be frugal! - cancel out on any subscriptions you currently have on - leasing of the equipment rather than purchasing is highly recommended Remember, you are running your startup against a cut-throat competition and your prime focus should be that of generating revenues to the maximum. Traverse the alternatives: Someone with a startup would definitely, in fact must, keep other funding options absolutely open. It is a well-known fact that financial institutions hesitate to lend money to startups taking baby steps. Then comes the dreaded question as to where one must look out when the only option, the bank, does not have much to offer?  Here are a few options: Peer-to-peer lending: This can be your muse when bank shuts the door right on your face. This is truly godsend considering that it does not involve the kind of paperwork traditional institutions do. Moreover, the interests rates are relatively lower and do not at all mean a long waiting process. Angel in disguise: Well, these are wealthy people or could be retired company executives who makes a direct investment in small businesses. They generally are the ones who have been top players in their respective fields and in addition to monetary investment, also offer their expertise, network of contacts they have made over their career span as well as technical or managerial know-how. Like venture capitals, they as well in exchange of the investment gets exclusive rights over the company and may require transparency in all the aspects and a full-fledge seat on the board of directors. Venture capital: It comes off from reputed investors, investment banks or any other financial institution. The finance provided by investors is to those startup businesses with great long term growth potential. The only drawback is that the investors end up having equity in the company it provides finance to and as a result, get a rest over the company and its decisions. Crowd funding: Crowd funding is meant for people who are looking for funds to run a project or venture via people from across the globe, typically from the Internet. Any who connects with your idea of the startup or shares the same passion as you can contribute money. It, however, involves a return to the crowd funders as a reward in form of a gift, profit or giving a share of the company. You can also seek advice from the experts to make better financial choices if you are doubtful or in any sort of dilemma between whatever options you are thinking to opt for. Or you could simply opt for fast capital loans; we understand it can be one daunting decision to make! Hire freelancers or outsource: There is a pool of talent out there if you know how to get the best one for your startup and use it productively. Freelancing or outsourcing tasks only makes it better on the cash flow.  To begin with, hiring a freelancer will cut down on cost considering the fact that the result would be quality yet easy on the startup's pocket as compared to a full-time employee; that too with the same skill set. In addition to this outsourcing means you have less pressure to deal with and all the chance to focus wholly on to your business model and on the fact of making it emerge as the most lucrative business ever. If you are looking for a reliable portal to hire freelancers from, then Upwork can really help you in this regard. It is one of the most sought after portals out there on Internet. Not only are this, but Freelancer or Fiverr are other great options too that can serve you quite well. Maintain the record: Keeping the finance record up to date is paramount when you dream of your startup soaring.  It is common to wait until the end of the month, or in some cases even a year to do the final accounting. However, we recommend doing it on weekly basis so that you know where you need to make that big change. Also, prefer mobile payment solutions in order to receive payments on a faster rate. This will keep the record in full alignment with the cash flow in real-time as there won't be any delays. Speaking of this, there are applications out there that are awesome enough to make the mobile payment easier for you. When you have a startup to run, it is wise to keep a constant check on to the accounts so that you are well aware of your business's footing; is it strong enough or is asking for a bit of tweak? Considering that you have a startup, we recommending maintaining accounts on Excel first and then move onto online accounting softwares such as, Wave or Quickbooks.