3 Tips to Manage Your Start-Up Money
Originally published on April 27, 2015
Updated on November 1st, 2023
The Florida Innovation Hub in Gainesville helps support more than thirty startup companies that are developing and marketing a variety of new technologies in the surrounding area. The unique, all-inclusive business incubator helps shorten the journey from discovery to the marketplace for Florida’s tech startup companies. Generally serving companies within their first six weeks to two years of life, the hub also helps companies understand the need for accounting and fiduciary responsibilities when managing grant money and other investments.
Many early stage start-up companies don’t fully understand the risks of not properly handling large investment dollars and federal grants. John King, the mentor in residence at the office of technology licensing at the Hub, advises these companies to take advantage of the consulting opportunities and advice of accounting firms when managing large amounts of investment money before the first six months of the company’s lifecycle. Adopting an appropriate financial process early on will help these companies remain financially accountable for any investment and grant money.
The hub, as well as the James Moore Technology Services Team, has taken on the initiative to work with startup companies to help them implement applicable accounting structures and develop financial policies and procedures to better protect investment money and to ultimately ensure financial success.
As the innovation hub declares, and as James Moore stands by: “You’ve developed technologies that can change lives. We’re dedicated to improving your likelihood of success.” Over time, your company will secure investment dollars or grant money, and will eventually bring your product or service to market. When this occurs, make sure you are prepared to manage your money and business wisely using the following three tips.
3 Tips to Manage your Startup Money
1. Frequently Analyze Your Cash Burn Rate
There are major benefits to examining your costs. Analyzing your cash burn rate will help you make more informed decisions on a daily basis. It will also help you update your business plan and adjust your strategies going forward. Lastly, your current and future financial situation will be evident making it easier to communicate strategically with your investors.
2. Hire an Accountant
Once you receive an equity or debt investment, consider the advice of a CPA. A certified accountant can certainly aid your company with its financial planning and can advise on investments and growth strategies. Accountants understand the importance of the business community and are great referral partners.
3. Strategic Hiring
You might have the best product or service on the market, but if you don’t have a channel of distribution, you won’t be generating much revenue. One of the best ways to increase revenue is to hire someone that can get you closer to generating sales. Developing a robust revenue stream will improve your company’s valuation making easier to raise additional money from your investors.
Manage your Money Like a Pro
You won’t become a successful entrepreneur over night. However, by effectively managing your start-up money, you can help ensure your company is poised for long-term growth and success.
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