In the wake of any ever-changing political and economic climate, today’s startups strive to be lean, mean and efficient.
And sure, it’s no secret that it pays to be cautious when it comes time to start a business. That said, many new entrepreneurs don’t fall prey to spending more than they need to during the early days of building their empires.
In short, it’s all about assessing wants versus needs in terms of your business’ budget. Below we’ve outlined five common investments for budding businesses and whether or not they represent essential do’s or don’ts.
Do: Entity Formation
For both legal protection and taxation purposes, you’ll need to decide first and foremost whether you want to form your business as an LLC, or alternatively an s-corp or c-corp based on the size and needs of your company.
Don’t just copycat what other businesses in your area have done, but rather take the time to do your homework and speak to a tax professional about the process. Given the ongoing debate over tax legislation in recent months, taking care of your entity formation can give you some much-needed peace of mind.
Don’t: Physical Location
If you can help it, go as long as you possibly can without the costly investment of a physical location. Working from home or out of remote working spaces (think: community offices, coffee shops and so on) has become the norm for so many freelancers and solo business owners.
Even if you desire a physical space to meet with clients, such a luxury can be often be reserved until you have a steady stream of clientele rather than your initial days as a startup.
Again, it’s all about wants versus needs. Sure, a dedicated meeting space would be nice, but is it worth shelling out thousands in rent per month? In 95% of cases, the answer is resounding “no.”
Do: Web Hosting
Simply put, every business needs a website despite rumblings that you can get away with little more than a Facebook page. Businesses today need a central “hub” for their companies to communicate with contacts, and likewise a place to drive organic traffic and rank for keywords related to their business.
Especially if you’re operating in a local area, proper web-hosting and a site from a platform such as WordPress are essential. These investments are relatively low-cost and you don’t have to blow out your budget for hosting if you’re just keeping up a static website with not much upkeep.
Despite popular belief, you don’t need a huge influx of cash to start your company. Having others back your dream might seem like the ideal situation, but it’s not realistic to hope for a “what-if” situation where someone else is going to prop you up. Don’t let the actions of others keep you from getting started. Instead, avoid analysis paralysis by taking matters into your own hands.
Do: Internet Marketing Channels
Investing in marketing channels might seem like a backward step for those trying to their budgets in check. That said, there are a number of effective ways to get more eyes on your business that are cost-effective if you do your homework and only pay on an as-needed basis.
Such options include running targeted Facebook ads which allow you to solely target customers and leads relevant to your business. Similarly, you can build your email list with free platforms such as MailChimp (among others) which are totally free as you get started from scratch with email marketing.
In short, the right marketing channels can provide a great ROI in terms of your time and money. These channels are more “direct” and won’t cause you to play the tedious waiting game when it comes to traffic and leads.
Little budget? Don’t sweat it. The playing field is arguably more even than ever for those looking to start a business: just make sure you understand your wants versus needs prior to spending a dime.