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6 Money Management Tips to Aid Your Startup Success [Infographic]

6 Money Management Tips to Aid Your Startup Success [Infographic]

A discussion on Quora revealed that there are 4 million entrepreneurs worldwide. In the US alone, there are 11.5 million entrepreneurs and approximately 2.6million venture backed startups. Moreover, the percentage of successful startups is significantly lower than that of unsuccessful ones. With these numbers in mind, we can assume just how important of a role money management plays in a world of “break-even” and “ROI” KPIs.

In order to aid young entrepreneurs and startup founders, here are 6 money management tips that might save the day.

1. Money Comes With Patience So Don’t Rush It

Before the grand launch, make sure you have a clear business plan and enough funds to cover both your immediate, longterm and unexpected expenses. Your safety net should cover the first three years and by the second year, stop relying 100% on external funding.

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Carefully separate company needs from personal desires. You may want your entire team to have the latest technology access and gadgets, but think twice before creating your paradise. Do you really need it? Can you still perform over 90% with more affordable options? If the answer is Yes, you know what you have to do.

2. Do What’s Best For Your Business, Not For You

Choose your business partners and employees or contractors with care. Pay attention if you don’t want to pay later for the lack of it. Don’t build your startup involving various services just because the people that offer them are your friends. At the end of the day, business is business.

As the infographic below by Mirador Wealth suggests, research before investing especially before going big. The most dangerous enemy is yourself: often, entrepreneurs push themselves into a “make it or break it” world, without realizing you can actually achieve success with baby steps. Empires were not built in a day. Most likely, it took years, decades or even centuries.

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Personal advice: “Don’t throw the nets into an ocean unless you are absolutely convinced it will bring you more fish.”

3. Don’t Let Competition Distract You

Just because your competitors are “older” on the market and can afford over spending, does not mean you have to follow in their footsteps. You may find that creativity gets you out of tight spots and a small, yet smart strategy can be more fruitful. As seen on Forbes. Be smart and engage your consumers wittily.

4. Constantly Keep An Eye On Expenses And Profits

Take into account what your monthly costs are, as well as any changes that can occur. If you don’t have a financial expert, pick up the pen, separate your fixed and variable costs, draw the line and monitor them closely. This alone will help you understand your monthly and quarterly profit, and provide a clear view on growth. The secret recipe is a good accountant + good bookkeeper + open minded business owner.

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5. Establish Clear Goals

Start with clear goals, as this Inc.com article suggests. Quarterly and yearly goals can do the trick should your startup be a new player on the market. A clear understanding of required resources and realistic deadlines must be taken into account. Important: stay away from these two extreme behaviors:

  1. Setting low goals and thinking you’re exceptional when you’re simply average.
  2. Setting goals almost impossible to achieve and blaming failure on others.

Communicate and consult with your partners and employees (or contractors) and be open to suggestions. A brainstorming session could make the difference in your pockets at the end of your third quarter, for e.g.

6. Re-evaluate Throughout the Whole Year

Any small business in its first five years of survival could benefit from this tip. For e.g., should your goal be generating a minimum of USD 5000 profit per month in a collapsing market, then it makes no sense to keep investing. Relax, re-evaluate your position and your odds and adjust your strategy to the “business flow”. Being inflexible might cost much more in the long run.

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Wrapping It Up

While we all tend to “listen, nod and then do whatever we want”, the best piece of advice that you can follow is to be realistic in terms of investments. Set achievable goals, keep a close eye on the bigger picture and be flexible. Last but not least, as a friend of mine often says: “Be an epic doer!”.

money management tips

    source: Mirador Wealth

    Featured photo credit: Sean MacEntee via flickr.com

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    Last Updated on June 13, 2019

    15 Best Entrepreneurs Books to Start Reading Now to Be Successful

    15 Best Entrepreneurs Books to Start Reading Now to Be Successful

    Knowledge is power, and you’re going to need a lot of it if you’re going to be able to steer your business to success.

    Without further ado, let’s take a look at the 15 best entrepreneurs books to get inspirations about success and grow your business.

    1. Think and Grow Rich by Napoleon Hill

      This book has been dubbed the Granddaddy of All Motivational Literature, and it was actually the first book that gave a prescription of what it takes to be a winner.

      Napoleon Hill draws from the stories of millionaires like Henry Ford, Andrew Carnegie, and Thomas Edison to illustrate the principles he put forth.

      Get the book here!

      2. The Lean Startup by Eric Reis

        A lot of startups end up failing, but many of these failures are actually avoidable. The Lean Startup provides a different approach that is now being adopted all over the world and changing the way that companies are developed and products are being launched.

        In The Lean Startup, Eric Reis describes what is required for a company to penetrate the fog of uncertainty in order to discover a path to a sustainable and successful business.

        Get the book here!

        3. The E-Myth Revisited by Michael E. Gerber

          In a revised edition of the 150,000-copy bestseller, The E-Myth, Michael Gerber refutes some of the myths that surround starting your own business and shows just how commonplace assumptions can end up getting in the way of being able to run a successful business.

          Gerber succeeds in walking the reader through the steps that occur in the life of a business, from infancy, through the pains of growing as an adolescent, to the perspective of the mature entrepreneur.

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          Get the book here!

          4. Rework by Jason Fried

            Most of the business books that you get today will give you the same advice: draft a business plan, study the competition, look for investors, and all that.

            However, Rework shows you a more effective, easier and faster means of succeeding when running a business. By reading it, you’ll be able to know why some plans are harmful, why you don’t really need to get investors, and why you’re better of shutting out your competition.

            Get the book here!

            5. How to Win Friends and Influence People by Dale Carnegie

              This is one of the most successful motivational books in history, selling well over 15 million copies since it was released in 1936. The book is timeless, and it appeals to businesses, self-help startups, and general readers.

              Carnegie believes that a lot of successes come from an ability to communicate rather than having brilliant insights. In his book, he teaches how to value others and make them feel appreciated and loved.

              Get the book here!

              6. Outliers: The Story of Success by Malcolm Gladwell

                Through this amazing book, Malcolm Gladwell is able to take the reader on an intellectual journey through the world of ‘outliers’. He asks the question of what truly differentiates high-achievers.

                His answer to this question is that we tend to pay too much attention to what successful people are like, and less attention to where they are actually from.

                Get the book here!

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                7. Rich Dad, Poor Dad by Robert T. Kiyosaki

                  This is the best personal finance book ever written. It tells the story of Kiyosaki and his two fathers; his real father, and that of his best friend (his rich dad), as well as how the two men helped him shape his opinions on money and investing.

                  It refutes the myth that you need to earn high to become rich, and it distinguishes between working for money and having money work for you.

                  Get the book here!

                  8. The Ascent of Money: The Financial History of the World by Niall Ferguson

                    Niall Ferguson, in this book, follows the money to tell the story behind the evolution of the word’s financial system, from the beginning way back in ancient Mesopotamia to the latest occurrences in what he had dubbed Planet Finance.

                    Fergusson also reveals financial history as the backstory behind our very own history, with an argument that the evolution of debt and credit is as significant as the history of technological innovation and the rise of civilization.

                    Get the book here!

                    9. Liar’s Poker by Michael Lewis

                      Michael Lewis landed a job at Salomon Brothers after getting out of the London School of Economics and Princeton within three years, he had risen to the rank of bond salesman, making millions for the firm and cashing out steadily.

                      Liar’s Poker is the amalgamation of these years — a look behind the scenes at one of the most turbulent times in American business. His book is Lewis’s account of an era where greed and gluttony were the order of the day.

                      Get the book here!

                      10. Drive: The Surprising Truth about What Motivates Us by Michael H. Pink

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                        A lot of people see money as the best motivator. Michael pink says it’s a mistake.

                        In this provocative book, he asserts that the secret to high performance anywhere is the need to direct our lives, to learn and create, and to do better by our world and ourselves.

                        Get the book here!

                        11. Getting Things Done: The Art of Stress-Free Productivity by David Allen

                          Outdated methods don’t work in today’s world. In this book, Allen shares some awesome methods for stress-free performance that he has shared with thousands of people all over the world.

                          His premise? That productivity is proportional to your ability to relax.

                          Get the book here!

                          12. The 7 Habits of Highly Effective People by Stephen R. Covey

                            In this book, Stephen Covey presents a holistic approach for overcoming both professional and personal issues. With insights and anecdotes, Covey presents a way to live with integrity fairness, service and dignity.

                            Get the book here!

                            13. The 4-Hour Workweek: Escape the 9-5, Live Anywhere, and Join the New Rich by Tim Ferriss

                              In this book, Ferriss dishes on the tips he has learned from studying the New Rich, a subculture of people who did away with the deferred life plan and mastered time and mobility to developed luxury lifestyles for themselves.

                              If you’re looking to make your way in this revolutionary new world, this here is your compass.

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                              Get the book here!

                              14. Delivering Happiness: A Path to Profits, Passion, and Purpose by Tony Hsieh

                                The CEO of Zappos shows how a unique kind of corporate identity can help deliver a huge difference in the way results are being achieved — by creating a company that values and delivers happiness.

                                Get the book here!

                                15. Losing My Virginity: How I Survived, Had Fun, and Made a Fortune Doing Business My Way by Richard Branson

                                  From Virgin Atlantic Airways, Virgin Records and V2 to Virgin Cola, Virgin Megastores and a wide array of other companies, Richard Branson is the rockstar billionaire that a lot of us want to be.

                                  Branson, however, did business by following a simple philosophy:

                                  “Oh, screw it, let’s do it”

                                  Losing My Virginity is an unusual, borderline outrageous autobiography of one of the greatest business geniuses in the world. Branson and his friends named their business “Virgin” because that was what they were — virgins at the game.

                                  Since then, he’s written his success rules, creating a global business that has no headquarters, no management structure no corporate identity as it were.

                                  Get the book here!

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                                  Featured photo credit: rawpixel via unsplash.com

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