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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 March 29, 2021

    5 Types of Horrible Bosses and How to Beat Them All

    5 Types of Horrible Bosses and How to Beat Them All

    When I left university I took a job immediately, I had been lucky as I had spent a year earning almost nothing as an intern so I was offered a role. On my first day I found that I had not been allocated a desk, there was no one to greet me so I was left for some hours ignored. I happened to snipe about this to another employee at the coffee machine two things happened. The first was that the person I had complained to was my new manager’s wife, and the second was, in his own words, ‘that he would come down on me like a ton of bricks if I crossed him…’

    What a great start to a job! I had moved to a new city, and had been at work for less than a morning when I had my first run in with the first style of bad manager. I didn’t stay long enough to find out what Mr Agressive would do next. Bad managers are a major issue. Research from Approved Index shows that more than four in ten employees (42%) state that they have previously quit a job because of a bad manager.

    The Dream Type Of Manager

    My best manager was a total opposite. A man who had been the head of the UK tax system and was working his retirement running a company I was a very junior and green employee for. I made a stupid mistake, one which cost a lot of time and money and I felt I was going to be sacked without doubt.

    I was nervous, beating myself up about what I had done, what would happen. At the end of the day I was called to his office, he had made me wait and I had spent that day talking to other employees, trying to understand where I had gone wrong. It had been a simple mistyped line of code which sent a massive print job out totally wrong. I learn how I should have done it and I fretted.

    My boss asked me to step into his office, he asked me to sit down. “Do you know what you did?” I babbled, yes, I had been stupid, I had not double-checked or asked for advice when I was doing something I had not really understood. It was totally my fault. He paused. “Will you do that again?” Of course I told him I would not, I would always double check, ask for help and not try to be so clever when I was not!

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    “Okay…”

    That was it. I paused and asked, should I clear my desk. He smiled. “You have learnt a valuable lesson, I can be sure that you will never make a mistake like that again. Why would I want to get rid of an employee who knows that?”

    I stayed with that company for many years, the way I was treated was a real object lesson in good management. Sadly, far too many poor managers exist out there.

    The Complete Catalogue of Bad Managers

    The Bully

    My first boss fitted into the classic bully class. This is so often the ‘old school’ management by power style. I encountered this style again in the retail sector where one manager felt the only way to get the best from staff was to bawl and yell.

    However, like so many bullies you will often find that this can be someone who either knows no better or is under stress and they are themselves running scared of the situation they have found themselves in.

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    The Invisible Boss

    This can either present itself as management from afar (usually the golf course or ‘important meetings) or just a boss who is too busy being important to deal with their staff.

    It can feel refreshing as you will often have almost total freedom with your manager taking little or no interest in your activities, however you will soon find that you also lack the support that a good manager will provide. Without direction you may feel you are doing well just to find that you are not delivering against expectations you were not told about and suddenly it is all your fault.

    The Micro Manager

    The frustration of having a manager who feels the need to be involved in everything you do. The polar opposite to the Invisible Boss you will feel that there is no trust in your work as they will want to meddle in everything you do.

    Dealing with the micro-manager can be difficult. Often their management style comes from their own insecurity. You can try confronting them, tell them that you can do your job however in many cases this will not succeed and can in fact make things worse.

    The Over Promoted Boss

    The Over promoted boss categorises someone who has no idea. They have found themselves in a management position through service, family or some corporate mystery. They are people who are not only highly unqualified to be managers they will generally be unable to do even your job.

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    You can find yourself persistently frustrated by the situation you are in, however it can seem impossible to get out without handing over your resignation.

    The Credit Stealer

    The credit stealer is the boss who will never publically acknowledge the work you do. You will put in the extra hours working on a project and you know that, in the ‘big meeting’ it will be your credit stealing boss who will take all of the credit!

    Again it is demoralising, you see all of the credit for your labour being stolen and this can often lead to good employees looking for new careers.

    3 Essential Ways to Work (Cope) with Bad Managers

    Whatever type of bad boss you have there are certain things that you can do to ensure that you get the recognition and protection you require to not only remain sane but to also build your career.

    1. Keep evidence

    Whether it is incidents with the bully or examples of projects you have completed with the credit stealer you will always be well served to keep notes and supporting evidence for projects you are working on.

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    Buy your own notebook and ensure that you are always making notes, it becomes a habit and a very useful one as you have a constant reminder as well as somewhere to explore ideas.

    Importantly, if you do have to go to HR or stand-up for yourself you will have clear records! Also, don’t always trust that corporate servers or emails will always be available or not tampered with. Keep your own content.

    2. Hold regular meetings

    Ensure that you make time for regular meetings with your boss. This is especially useful for the over-promoted or the invisible boss to allow you to ‘manage upwards’. Take charge where you can to set your objectives and use these meetings to set clear objectives and document the status of your work.

    3. Stand your ground, but be ready to jump…

    Remember that you don’t have to put up with poor management. If you have issues you should face them with your boss, maybe they do not know that they are coming across in a bad way.

    However, be ready to recognise if the situation is not going to change. If that is the case, keep your head down and get working on polishing your CV! If it isn’t working, there will be something better out there for you!

    Good luck!

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