You may have the best idea in the world, but if you don’t have the money in place to launch your startup and keep it going, it will be difficult for you to succeed. You need to get your financial situation in order and line up funding. You may want to talk to a financial professional and line up an accountant or a bookkeeper to work with, but the steps below can also help.
Organize Your Personal Finances
You’ll want to separate your personal and business finances, but you still need to have your personal finances in order. This is partly just because it will be easier to manage your business finances when your own money situation is not a mess, but it’s also because potential investors and lenders may look at your personal situation before deciding whether to give you more cash. You may want to work on reducing your debt.
Taking out a personal loan can help. This is one way to finance the funds you need to get your finances in order, paying off multiple high-interest debts with the loan. You should also have a budget and a good idea of what you need monthly at minimum to live on. Finally, you should put away several months of expenses in an emergency fund.
Keep Your Day Job
If it’s possible, you should keep working while you launch your new business. There are a few caveats. First, depending on the nature of your startup, you may need to be available during regular business hours. Second, your day job might have a rule against working a second job. Some companies will even claim ownership of intellectual property you create while you are employed, so you need to make sure that you are in the clear.
Third, trying to juggle your day job and your start up could make you look unprofessional to some potential investors. On the other hand, staying at your job can mean you don’t have to worry as much about money and you can give your startup longer to get off the ground before you need it to turn a profit. Consider your individual situation carefully as you decide what is best.
There are a number of different ways to fund your business. Some people use their own money. The advantage is that no one else has a claim to any part of your business. The disadvantage is that this may limit what you can accomplish. You might be able to take out business loans.
The best bet for many startups is investors. These may be venture capitalists or angel investors, who are often on the lookup for exciting new ideas in tech. However, if you don’t have the kind of business idea that will get these high-rolling investors excited, don’t despair. You may be able to attract more conventional investors in your network. Keep in mind as well that you don’t necessarily have to start with a lot of money. You can build your business up slowly, taking your time and gradually creating a solid financial base from which you will operate.