1. Office Space
A startup’s business expenses begin with office space. Operating remotely raises the question of whether there is a need for physical office space. This is because remote business operations and having a company registered office address allow people to work remotely while still using that address for professional purposes. Helping establish credibility and legitimacy for the business, providing a formal presence without the need for a traditional office.
2. No Full-Time Employees
The biggest mistake adding to startup costs is hiring full-time employees. Look for subcontractors and part-time employees to fulfill the work needs. If there is a necessity, ramp the same employees to full-time, and avoid wasting money.
3. Reimbursements
Startups ignore the money wasted on meals or travel. It is best to consider reimbursement policy and document business expenses. Businesses will appreciate accurate budgeting and control of expenses.
4. Fancy Perks
Startups spend more to attract talent. It is important to do market research. Startups are in the starting stage and cannot provide perks or compensation to employees. Thus, it is best to focus on top talent who is ready to work with you on your mission.
5. Cheap Solutions
Saving money with cheap solutions is the right solution for startups. New entrepreneurs cannot dip their toes or spend more to pick a few things. Look for affordable solutions to last for years, no matter whether it is software or people. Check for subscription-based Services.
6. Least Viable Products
Startups and corporate innovators waste money before they nail a fit solution in the market. It means spending more and launching a product that is not a need in the market. Perform market research and understand the viable products.
7. Underqualified Staff
Startups make a huge mistake of hiring underqualified staff. They are not the right fit and add to expenses. Selecting quality candidates is crucial and hiring underqualified staff is a costly mistake.
8. Hiring Outside Leadership
Elevating the position of a new company is vital and startups believe in hiring outside leadership. It does not help. Instead, you know about the firm better and the solution it is going to offer, so do it.
9. Business Travel
Visiting a partner or some prospect results in unwanted travel costs. It adds to startup costs. Avoid instant booking, book ahead, and save money.
10. Fine-Tuning Product
Spending on fine-tuning is common for startups on their products. It is a way of beating stress before the product is live, but it turns out to be high on business expenses. Instead, sell by creating MVP and fine-tune as per the market request or demand. Thus, startups can save money and time.
11. Reactive Tax Planning
Being proactive about taxes is more useful than being reactive. Working with a good accountant is crucial. It is because he will not understand your business. It is effective to manage by yourself only if you know about taxes. If not attempting a DIY may end up in major tax surprises. Understand the industry by partnering with a CPA and ensure a proactive planning approach towards tax. It helps avoid expensive tax surprises.
12. Unrestrained Celebrations
Startups prosper early many times, but instead of saving, they start celebrations of their new success. There is no need for unrestrained celebrations or some holiday party. Make money, ensure you have solid ground beneath, operate for a few years, pay bills on time, and celebrate in a small way. Keep the hope alive and use the celebration time to bring more customers by offering subscription-based Services.
INFOGRAPHIC
