Working as a startup employee is lot more different from being part of a big MNC or corporate company because the work here is not defined and specific. However, startups are booming as always and are becoming the preference of job seekers for the unmatched fun with work culture it provides. But then again, it is not easy to cater to your startup business and its needs. The journey and work becomes lot more easier when you have the best of resources, employees, talent, investments and work culture on board.
Productive alternative ways for entrepreneurs and investor less funding
Raising money is often the toughest part of starting a business, and it’s also the most important. The majority of small businesses that fail within the first few months have one simple thing in common — they run out of money.
The software world is famous for high-profile funding rounds and enormous valuations. But the reality is that most small businesses don't secure equity-based funding, and it doesn’t always make sense to chase down a venture capital investor. Traditional fundraising takes a lot of time — taking away valuable time that you could be spending developing your product and supporting your customers. There’s also the important issue that as you continue fundraising, you’ll own less and less of your company.
Here are a few alternatives for getting your business off the ground without pursuing VC funding.
1. Don’t quit your day job until you start making money in your startup
Keeping your day job is one of the safest ways to keep up with your rent or mortgage payments while you build out your new business. If you decide to take this route, make sure you fully understand your employee contract — particularly any guidelines regarding a non-compete clause or after-hours work.
Financially, this is one of the least risky options to fund your business, but the long days can take their toll on you and it can be emotionally tiring to feel pulled in so many different directions. If you’re truly passionate and excited about your business idea, it’s a lot easier to dedicate one or two weeknights and a weekend day to the startup.
2. Bootstrap and keep your costs low
No matter how big your bank account may be, it’s Business Management 101 to make sure your expenses are realistic for your budget. Don’t listen to all the “go big or go home” or “spend money to make money” speeches: you need to do whatever you can to keep your overhead costs as low as possible at the beginning.
Work out of your home, or co-locate with another company or business incubator. Delay any capital purchases that aren't absolute necessities, and think about leasing when possible. Hire interns from local schools (don’t forget that an intern doesn’t equal free labor; you’ll need to invest some time to help them grow their skills and experience). And always negotiate your fees and terms with any vendors.
3. Reinvest any profits back into the business
If your business is profitable, you can reinvest any profits back into your business and feed your growth through your cash flow. As you continue to grow, you can reinvest into additional people, equipment, marketing, etc. The downside is that relying on your company’s revenue means you can only grow as fast as your sales.
4. Get a private loan
One of the advantages about bootstrapping is that once you reach a certain level of revenue and cash flow, it’s much easier to find a bank or other institutional lender that’s willing to lend to you. Banks aren’t known for taking risks with their funds, so your business will need a solid credit history and revenue to qualify. You may have the greatest chance of being approved if you approach a local bank or somewhere you already have a banking relationship.
5. Reach out to family and friends
For many, tapping into a friends and family round can be a logical starting point for their fundraising. You most likely won’t have to spend a month putting together a 100-page business plan to convince your mom that your brilliant idea deserves some backing. However, mixing money and relationships is full of pitfalls. You may find yourself getting lots of unwanted advice and having family get-togethers that start to feel more like awkward investor meetings.
If you do end up borrowing money from family or friends, make sure that you’re completely transparent about the associated risk and the expected roles and involvement for any investors. Most importantly, never take money that your friend or family member can’t afford to lose.
6. Crowdfund Instantly
Crowdfunding is not right for every business idea and maybe you’ll just end up raising a couple of thousand dollars from your friends and friends of friends, but sites like Kickstarter or Indiegogo can be a compelling option to explore.
In addition to the obvious benefit of getting you some much-needed capital, crowdfunding can help a budding company in other ways too: it forces you to start building your brand and engaging from the start. You’ll grow a customer base, get more exposure, and get real-world validation about your idea.
Here are some ways when you can make the most of the available resources and make your startup a big success, reports ET.
7. Sketch out a Plan
The purpose of the startup should be clear and goals should be made transparent to the workers. Job seekers look for companies that have fixed targets and goals and are passionately driven towards it as this ensures their personal growth.
8. Equip yourself with Latest Technology
The workers should be aware of the latest technologies and should be skilled to use them for work execution. Latest technological tools help forming bigger networks, problem solving, finding resources and much more. If you have the vision but not the power of technology, things become difficult.
9. Putting Employee First
Employees are the ones who can either make or break your business. Their satisfaction should always be your priority because they are the ones who ensure that your customers receive the best of service. The Employee-First Culture is trending in the business space. This helps in employee retention, increase profitability and producing more loyal workers.
10. Be a Hands-on Leader
You need to keep your employees engaged by giving them interesting work to achieve certain targets meeting the deadlines. Try to understand the perspective of your employee during crisis to gauge the situation.
11. Create your Tradition
Rather joining the bandwagon, create and introduce your own traditions that you think would promote productivity at your startup. Work hard with workers but do not forget to celebrate the success as well. This unites the team and motivates them to do better and treat the company as their own.
The bottom line is money is important to every business, but you don’t necessarily need a multi-million dollar seed or Series A round in order to launch.