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Ask the Entrepreneurs: 12 Ways to Shore Up Your Company Finances

Ask the Entrepreneurs: 12 Ways to Shore Up Your Company Finances

Ask The Entrepreneurs is a regular series where members of those involved in the Young Entrepreneur Council are asked a single question that aims to help Lifehack readers level up their own lives, whether in a area of management, communication, business or life in general. Here’s the question posed in this edition of Ask The Entrepreneurs:

What is one financial resolution that all aspiring entrepreneurs should make for themselves in 2013?

1. Track Your Monthly Income and Expenses

Nathalie Lussier

    This might seem a little too basic, but if you’re not doing at least some bookkeeping on a regular basis, you don’t have your pulse on your business’ numbers. Being able to look at how much money came in and went out in one month is crucial to any startup or aspiring entrepreneur. Even if you’re not bringing much in, you need to know that.

    Nathalie Lussier, The Website Checkup Tool

    2. Increase Your Rate of Savings

    Lawrence Watkins

      Becoming an entrepreneur can be a scary proposition, and one factor that keeps many people from making that leap is finances. If you’re living paycheck to paycheck, then it can be hard to make those tough decisions that may be rough in the short term, but very beneficial in the long term. Once you answer how you’re going to eat and where your’e going to live, you can then focus on your business.

      Lawrence Watkins, Great Black Speakers

      3. Can You Really Live on Ramen?

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      Erik Severinghaus

        It’s easy to assume that if you quit the high-paying day job, your expenses will decline in tandem with your income. In reality, that’s a lot harder after you’re used to nicer meals, vacation travel, etc.

        Before you quit your job, figure out what you can really live on for two months and test your ability to stick to that budget. It’s a great way to see if you’ll be happy living on ramen noodles.

        Erik Severinghaus, SimpleRelevance

        4. Take an Accounting Class

        Thursday-Bram

          Even if you never have to do any accounting work at any company you ever start, understanding the basics of accounting will be very useful. Just being able to read accounting reports may save your bacon if there’s a potential issue in your company that your accounting software or a human accountant haven’t managed to pick up on.

          Thursday Bram, Hyper Modern Consulting

          5. Create a Personal Budget

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          Derek Flanzraich

            Sometimes, amidst all the startup craziness, entrepreneurs forget to plan and organize their own finances at all. Then, all of a sudden, you’ve ordered expensive sushi delivery for dinner every night and the numbers keep stacking up. Take some time over the holidays to plan out your own budget.

            Derek Flanzraich, Greatist

            6. Join the Peer Economy

            Eric Koester

              The Peer Economy, companies that help you buy, sell, or transact with your peers (think eBay, Etsy, Airbnb, Getaround, Taskrabbit, Zaarly, Odesk or dozens others), is a great way to make money or save money. So participate—either by renting your couch out or staying in an Airbnb place when you travel; finding a developer or selling your services on Elance; or more. But just participate.

              Eric Koester, Zaarly

              7. Give Yourself Permission to Fail

              Dave Ursillo

                Every aspiring entrepreneur should give themselves permission to fail in 2013 because the greatest obstacle that every entrepreneur must (and always will) encounter is fear; especially fear of uncertainty and the unknown. When you give yourself permission to fail—financially or otherwise—you really give yourself permission to try in the first place.

                Dave Ursillo, The Literati Writers

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                8. Pay Down Debt

                Elizabeth Saunders

                  If you have personal debt, try to dramatically reduce or ideally eliminate it prior to starting your business. Having lower recurring expenses will give you more freedom to take risks as you build your company.

                  Elizabeth Saunders, Real Life E®

                  9. Real-Time Visibility

                  Robert J. Moore

                    Establish a system to access financial data about your company’s performance on demand and in as close to real-time as possible. This will allow you to feel highly in tune with business growth and tackle challenges as early on as possible.

                    Robert J. Moore, RJMetrics

                    10. Launch Their Company

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                    Aron Schoenfeld

                      Too many people network, brainstorm and whiteboard continuously and just keep adding ideas and layers to their concept. Aspiring entrepreneurs need to draw a line and say “this is our MVP and now we will build it.” Sitting on an idea does not help you or make you any money but building your idea into a product or business will help you validate it and test the marketplace.

                      Aron Schoenfeld, Do It In Person LLC

                      11. Find Great Clients

                      John-Hall

                        Improve profit through better clients. Having great clients really does matter with overall happiness of a company. Make an effort to improve profits by taking on the right clients, not just more clients.

                        John Hall, Digital Talent Agents

                        12. Keep More of the Money You Make

                        Brian Moran

                          Keep more of the money you make! Strive to make sure that your costs are under control, make customers happier, and focus on stimulating repeat purchases from new customers. That doesn’t mean becoming a penny-pincher, but if you have costs that aren’t advancing your bottom line, cut them out! A business is only as strong as the money it keeps at the end of the year.

                          – Brian Moran, Get 10,000 Fans

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                          Last Updated on January 21, 2020

                          How to Develop a Millionaire Mindset in 6 Simple Steps

                          How to Develop a Millionaire Mindset in 6 Simple Steps

                          We all like to dream about being financially wealthy. For most people though, it remains a dream and nothing more. Why is that?

                          It’s because most people don’t set their mind to achieving that goal. They might not be happy in their current situation but they’re comfortable – and comfort is one of the biggest enemies of growth.

                          How do you go about developing that millionaire mindset? By following these simple steps:

                          1. Focus On What You Want – And Take It!

                          So many people are too timid to admit they want something and go for it. When there is something that you want to accomplish don’t think “I could never actually do that”, think “I could do that and I WILL do that”.

                          Millionaires play to win, not to avoid defeat.

                          This doesn’t mean to have to become a selfish jerk. What it means is becoming more assertive and honest with yourself. You don’t have to grab off other people. There is a big pot of unclaimed gold in the middle of the table — why shouldn’t you be the one to claim it? You deserve it!

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                          2. Become Goal-Orientated

                          It’s almost impossible to achieve anything if you don’t set firm goals. Only lottery winners become millionaires overnight. By setting yourself attainable goals, you will get there eventually. Don’t try to get rich quickly — get rich slowly.

                          Let’s take the idea of making your first million dollars and expand on what kind of goals you might set to get there. Let’s also say you’re starting at a break-even position – you’re making enough to get by with a few luxuries, but nothing more.

                          Your goal for the first year can be having $10,000 in the bank within a year. It won’t be easy but it is doable. Next, you need to figure out the steps you need to take to achieve that goal.

                          Always look at ways to make growth before cutbacks. With that in mind, you might want to see if you can negotiate a pay rise with your boss, or if there’s another job out there that will pay better. You might be comfortable in your old job but remember, comfort stunts growth.

                          You may also have other skills outside of your workplace that you can monetize to boost your bank balance. Maybe you can design websites for people, at a fee of course, or make alterations to clothes.

                          If this is still not enough to make the money you need to save $10,000 in a year, then it’s time to look at cutbacks. Do you have a bunch of old junk that someone else might love? Sell it! Do you really need to spend $10 on your lunch everyday when you could make your own for a fraction of the cost?

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                          If you are to become a millionaire, you need to start accumulating money.

                          Here’re some tips to help you: How to Become Goal Oriented and Achieve More in Life

                          3. Don’t Spend Your Money – Invest It

                          The reason you need to accumulate money is for step three. Millionaires tend to be frugal people, and that’s because they know the true value of money is in investing. Being your own boss goes hand-in-hand with becoming a millionaire. You’ll want to quit your regular job at some point.

                          Stop working for your money and make your money work for you.

                          Rather than buying yourself a new iPad, that $500 could be used to invest in the stock market. Find the right shares (more on that later), and that money could easily double within a year.

                          There’s not just the stock market — there’s also property, and your own education.

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                          4. Never Stop Learning

                          The best thing you can invest in is yourself.

                          Once most people leave the education system, they think their learning days are over. Well theirs might be, but yours shouldn’t be. Successful people continually learn and adapt.

                          Billionaire Warren Buffet estimates that he read at least 100 books on investing before he turned twenty. Most people never read another book after they’ve left school. Who would you rather be?

                          Learn everything you can about how economics works, how the stocks markets work, how they trend.

                          Learn new skills. If you have an interest in it, learn everything you can about it. You’d be surprised at how often, seemingly useless skills, can become extremely useful in the right situation.

                          Start developing the habit of learning continuously: How to Create a Habit of Continuous Learning for a Better You

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                          5. Think Big

                          While I advise to start off with small goals, you absolutely should have a big goal in mind. If you have a business idea, then that is your ultimate goal – to start that business and make a success of it. If you want to invest your way to millions of dollars and do little work other than research, then that is your big goal.

                          There is no shame in not achieving a big goal. If you run a business and aim to make $1 million profit in a year and “only” make $200,000, then you’re still significantly ahead of most people.

                          Aim for the stars, if you fail you’ll still be over the moon.

                          6. Enjoy the Attention

                          To be successful, you have to be willing to promote yourself and enjoy the attention to a certain extent. Now the attention doesn’t need to be on yourself, it could be on your brand, but attention definitely attracts money.

                          Never be embarrassed to get your name out there. That means finding a spotlight and being brave enough to step right up underneath it.

                          If you run a business, try contacting the local papers. You’d be surprised at how amenable they often are to running a story about you and your business, and it’s all free publicity.

                          Above all, remember: You control your own destiny. Push hard enough for anything and you’ll get it.

                          More About Thinking Smart

                          Featured photo credit: Austin Distel via unsplash.com

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