A 6-step plan to avoid the financial waste trap when launching your project

 

Whether you invest $100 or $100,000 in your own project, or your net worth is in millions or millimeters, it doesn't matter if you make the wrong financing that will negatively affect your future.

I've funded three successful startups, but there have also been a lot of failures. The first was a profitable self-funded startup for 12 years, then the second followed fairly quickly, and the third, an education startup, has been running for almost three years now with sustainable margins.

for the three successes; I followed the same self-financing plan that ended in failure at other times, which allowed me to overcome these failures and fund successful projects in the end. But I've never borrowed from friends or banks, and I've never used credit cards to buy anything I can't pay off at the end of the month, putting someone else at risk from me.

I'm not a billionaire, but I know I can make sure that if you get rid of all the distractions, all you'll be left with is common sense and hard work with a simple plan; Because at the end of the day, the success of a startup depends on how great the idea is and how well the execution is, not how much money you can spend on it.

Do not invest more than you can afford to lose

It is easier and cheaper than ever to start a business, even if it is a high-tech, high-growth startup, but this does not mean that it will be free, but your financial situation and business plan will determine if it is within your scope.

And when it comes to knowing how much you are going to invest in the end, it is like entering a gambling club and betting all that money and then finally losing it, you have to imagine this scenario to be able to make a plan in case you get into such a situation.

Develop a financing strategy

You should invest in yourself in stages, as any smart investor would. Although a $1,000 investment will not earn you $1 million in annual income, it can earn you up to $10,000 in annual income. Once this goal is achieved; You'll need to figure out how much you're spending on labor and cost of goods sold, and then figure out how to make up the difference.

And if you have $1,000 or $10,000 to invest in your project, spend some of it now, more in a few months, and then some more in a few months. At the end of those months, the losing period stops, and if you haven't found a trigger by then, you either have to quit or take care of something else, but give yourself plenty of time.

Learn how to get things done that others pay for

I do not hire anyone else to perform certain tasks; Marketing, sales, accounting, human resources, or at least a dozen other skills in which I can become an expert, knowing that I can learn enough in each area that I don't need to spend thousands of dollars on experts doing these things for me.

in addition; I hate all of these tasks (I actually learned to love sales and marketing, but it took me decades). What I mean here is that if you want to start a business, you need to know the basics of the tactical application of everything.

I've spent entire nights and even weekends absorbed in tasks I know nothing about, often stumbling around and turning to Google or Stack Overflow. And in many of those times; I find myself in a bind, but quickly find a viable alternative in the short term.

Look for alternatives to high-priced jobs

Not all businesses require expensive corporate jobs or a professional pay per job. Before spending money on any work your project needs; Whether it's technology, finance, marketing or something else, try doing it manually and for free.

• By the way, I've been criticized for promoting this by people who have access to more money than I do.

Take shortcuts whenever possible, make sure you don't take any major shortcuts for clients, also make sure you have a 'good' plan and only spend on things that generate immediate income, not just on extra administrative things that take time to achieve; The latter comes later.

Find people who are successful in this field and make deals with them

People will want to help you if you have a great idea that you are passionate about, and you can assure that you can implement it, but remember that most of them will want to help you because they see an opportunity for them. Some exceptions. So you need to be upfront about it and face it, and if the opportunity is win-win, you can make a deal.

Here's how:

• Practical help: If you can prove the potential value of ownership in the form of stock options, talented people can work with you for little or no money (for a while, not forever).

• Supplier Resources: If you can establish that you will be a valuable and loyal customer in the future, you may be able to get a discount or barter deal on the resources you need to become that customer.

• Partnerships: If you can barter one set of services for others, do-what-don't companies can help you get projects that fall under your services, not theirs.

• Customers: If you provide your first potential customers with a little better service than they pay you for, you may be able to build your first customer base which can play a role in attracting other customers.

Get revenue instantly

Nothing should be done that is not a tactical task in the strategic roadmap for sustainability; There will be too much temptation to skip, avoid, or deviate from this road map; From the tempting new opportunities that come your way, to the desperate moves in tough times.

Always make revenue a top priority, because you can't hope for the best if you don't find yourself in the financial position to act on those goals. finally; It is worth tracking everything you do and always analyzing all your data to determine your return on spend. Not only will this help you find your own growth path, but it will also prepare you to be able to generate a return on any outside investment you may make in the future.