Cash and Credit: 6 Tips For Keeping Your New Startup Out of the Red

your company finances

There are many benefits to beginning your own startup. From working your own hours to hiring whoever you want to run a business that you are actually passionate about – there are a plethora of reasons that can make you want to quit your job and go it alone. But, you need money to use as company finances.

However, no one wants to consider the possibility that their business will be the one to go bust. Unfortunately, it happens all too often with new businesses. The first year is the most important for startups, so take heed of these 6 tips to ensure that your livelihood stays afloat.

1. Keep personal and company finances separate

Any good business owner knows that the golden rule of a financially successful startup is to keep your personal and your company finances separate. This will ensure that you have enough money to pay your bills, buy your food, and generally keep you existing whilst you are embarking on setting up your startup.

Your business should be its own legal identity, which means it has its own finances. Your focus should be on maintaining revenue and viable capital in the first year of your startup. If you don’t have all of these aspects down pat, perhaps it’s time to chat with some reliable business accountants in Geelong to get you started.

2. Keep yourself marketable

Even though you probably began your startup because you want to work for yourself, it is always a good idea to keep your resume up to date just in case of any job opportunities that may present themselves. Try not to throw the towel in and make sure that you keep yourself marketable. After all, an up to date resume can mean making contacts, and good contacts are vital to the success of any startup!

3. Pay yourself what you’re worth

Before you begin a business, ensure that your role within your startup is defined. In saying this, make sure that you also pay yourself a suitable salary for someone who is going to be performing that role. Do not overpay yourself and do not underpay yourself. This will give you enough to cover the basic resources needed to run a successful and viable start-up company.

4. Know your personal financial goals

If you have clearly defined financial goals, you are far more likely to succeed.

company finances

Success should be measurable, and how can you measure it if you don’t know where you are going? Your business financial goals should be distinguished from your personal financial goals – don’t get the two mixed up! Knowing exactly what you are looking for in your business finances will help you structure your business model, your cash flow, and your financial planning.

5. Talk to professionals

At the end of the day, the professionals will always know best.

Talk to people around you; if you know someone who has their own business, pick their brain for answers and advice. No matter what your business looks like or what your goals may be, a bit of planning, advice and a chat can never hurt. The appropriate guidance for your startup can mean the difference between succeeding and go broke, so don’t be too proud when it comes to asking for help.

So, if you’re thinking about starting your own business, don’t jump in headfirst without the appropriate planning. Ensure that you keep your personal and company finances separate, keep yourself marketable for future opportunities, ensure you pay yourself a fair salary, you outline clear financial goals and you take the time to talk to professionals that can help you. If you stick to these 6 handy tips, you’ll be well on your way to running a successful startup.