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What’s more exciting than starting your own business? Your mind races 24/7 with ideas about your product line, marketing concepts, sales strategies and hiring your A-team. But in the midst of all that, there’s a vital aspect of entrepreneurship that often gets overlooked: finances. A company’s finances dictate success or failure. 

Skyrocketing sales and a brilliant product roadmap won’t matter if fixed expenses are too high, you’re spending money in the wrong places or ignoring basic rules of cash flow–so now is the time to get your finances right.

Cash flow management is key

Most startups fail for a variety of reasons, but one is far more common than others — running out of money. You need to know where every single dollar is coming from and where every single dollar is going.

If you don’t stay on top of your cash flow, you are going to put your business in a very dangerous position. It doesn’t matter how good your idea might be when you run out of money you hit a brick wall. Establish a budget and stick to it.

Track and monitor all spending

With a new startup, there are going to be expenses coming at you from every direction. Hiring a full-time staffer to handle the books in the beginning isn’t very budget-friendly, so use accounting software to remain organized.

Not only will this help with cash flow management, but it also makes it much easier when tax time rolls around every year. As you grow and the accounting becomes more complex, you will need to consider hiring a professional. 

Limit your fixed expenses in the beginning.

In the beginning stages of a startup, keeping your expenses low is the key to longevity. You don’t need a huge elaborate office in the heart of your city or fully catered meals three times a day.

Operate thin so you can allocate the majority of your capital to growth, which will enable you to one day implement any perk you want. Too many startups focus on the wrong things — like fancy offices and over-the-top amenities — and forget that generating revenue should be their top priority.

Establish financial goals

Rather than just say, “I want to build a multi-million dollar company,” you need to break financial goals down into reachable and measurable ones. 

Monthly, weekly or even daily revenue goals allow you to stay on track and make the adjustments necessary for constant growth. You can even set milestones to hit along the way, giving you a lot of smaller goals to constantly hit. Knocking out little goals can give you the confidence needed to keep powering through the entrepreneurial journey.