Say you need to keep yourself in business, and:
- You want to avoid debt, so you take financing from nobody.
- You have one month's worth of money in the bank.
- You want to eventually build a ridiculously successful business.
Know the Realities of a Cash-strapped Start-upYour brutal facts:
- If you don't have enough money next month to keep your business afloat, your business dies.
- If you can't make a decent living from your business, your business dies.
- If you can't find customers who will pay you before next month, your business dies.
3 Ways to Keep Your Business Start-up AfloatTo keep your business start-up ticking:
Sell things with quick sales cycles.If you're a mega-bootstrapper, you'll need enough money to keep food on the table -- then some extra to build your business. Let's say: you need around $2,000 in cash every month to: stay alive + build your business. Once you know that figure, start look for opportunities that can get you that $2,000 quickly (i.e. by the end of the month). For instance, building a mega-center can take months/years; you can start selling wholesale kitchen items from distributors through the phone, now.
Forget selling low-price items.Say you have two options:
- Sell frying pans for $10 profit each.
- Sell stoves for $1000 profit each.
To get that $2,000, you'll need convince at least 200 people to purchase your frying pans. Getting one customer to purchase from you is pretty freakishly hard enough. Two-hundred for the first-time entrepreneur is a near-impossibility. Yet, if you're selling a stove, you won't need to convince 200 people: just a tiny 2.
Do: What you love + What you know.When you do this, the "doing" part becomes so much easier, more efficient, and boosts productivity. Imagine studying for your favorite subject in school. Now, imagine studying for your worst subject.
- What went ridiculously quicker?
- What did you enjoy more?
- What gave you more confidence?
- What empowered your badass?
"But dude, I can't see myself selling these things for the next 10 years."If you don't have money in the bank to keep your business afloat every month, you won't be selling what you ultimately want anyway. The key is to get you enough cash this month to (1) live, and (2) keep your business afloat, and (3) eventually fund what you really want to do. Our tip -- Do it simultaneously:
- Sell quick-sales-cycles-stuff to get enough cash for this month.
- Build whatever the heck you want to build with the extra cash that you have.
"To keep my kick-ass start-up afloat, I will sell big-ticket items that have quick sales-cycles."
Posted on October 17
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