MONEY

Money must be the most misunderstood part of starting a business.

Its got to be the ultimate point to starting one, otherwise, it would just be a hobby.

But often our relationship with it is super complicated. We bestow it with all kinds of qualities - it’s good, it’s evil, I’m a good person for making it, I’m a bad person for wanting it, it’s dirty, it’s fabulous, I don’t deserve it, the list goes on.

Yep, poor old money gets a bad wrap.

I’m going to say, for the purpose of starting your own business, that money is the petrol in your car, and if you want to travel very far it’s important to fill up that tank baby so you won’t be left stranded on the side of the freeway.

Let’s look at the different ways of getting you some and how that’s linked to your business idea. Because every business idea has a different pathway to cash.

I’m a big believer in going for what you really want, I’m also a big believer in doing it in baby steps. But there is a balance.

Too much stressing about money can cloud your vision, and too much need for security will mean that you might never take the leap to have your own business.

CUSTOMER FEEDBACK

Get to your customers as soon as possible. Getting their feedback, innovating and responding is really important. Customer feedback helps you get out of your head and into reality. Can you try something in a marketplace, can you test your idea in a group where people want what you offer. Can you see if your writing style or artwork is on point or can you create a wow factor that starts people thinking about a totally different point of view or way of doing things?

This is not to put your idea in the hands of the wrong people by the way. If you test case your idea for young Mums in a group that doesn’t have kids that feedback could totally throw you off. You need responses from real customers. For example, the business I started in the UK called the English Teddy Bear Company started with t-shirts of fun designs of touristy Cambridge University things. The most popular design was a teddy bear. However, when we went into selling bears it was a disaster because there were no bears made in England at the time and if they were, they were crazy expensive.

I sat in our first shop making no money, hearing from people why they didn’t want the bears I had at the prices I had. However, I also heard from them exactly what they did want and how much they wanted to spend and when I did that for our customers the bears practically walked out the door themselves.

Once I understood what people really wanted I could roll it out to 15 stores and sell hundreds of thousands of products with a turnover of 5 million pounds a year.

CASH GENERATING

Can you choose a cash-generating business or find a cash-generating way into what you really want to do? A product or service you provide without an overhead?

This is easier said than done but it’s totally possible. Just make sure it is in line with what you really want to do and are really good at.

Can you do some consulting or coaching on the topic you love? Can you generate enough income part-time to get time to work on your ‘forever’ business idea? (If there is such a thing). Can you build it up while your working without going insane?

AN ESCAPE PLAN

Working a side hustle can be great but only if you have a clear escape plan. Most people get so knackered trying to do both that they lack the clarity to do either well and give up, usually on their dream business idea and not on their crappy job.

An escape plan must prioritise getting to money first so you can at least decrease your hours, or employ someone else to do some of the things you need doing.

It can involve using the money you are earning to do your product developmental or cover your start-up costs.

I also know people procrastiworking which means they are too scared to go into their business. They develop things and ideas endlessly but never get out and do it for real. That’s more like a hobby. You are paying for it, it’s not paying you.

RAISING CAPITAL

If what you really want to do requires some serious spondooly, like developing software or making a movie, you can have a parallel approach to get you the cash flow to hit the big dream.

The way to do it is to make it a relevant stepping stone to the bigger picture and here’s why.

Any way you make money has some drama attached to it and takes a degree of energy. You need to choose minimum energy and drama for maximum return so you don’t lose sight of the big picture.

Even better if the stepping stones can educate you further on what you really want to do.

Don’t underestimate this path though because it takes some determination to work a job and make time to also run a business especially when at the beginning you are required to do everything. I’m not a big fan of borrowing money to start a business as repayments can really cripple you and your baby steps. There are lots of great crowdfunding platforms that can work super well. Do your research on which one and why you need it.

If you don’t have money at least use your time to plan a great strategy.

SWAP TALENTS WITH SOMEONE

My friends and I call in contra and have fun with it. Belle and I started working together on one project and then kept working together by swapping our services. This felt good because we had the same quality of information and services for one another which put another way we had a compatible hourly rate and were both adding value. We then liked working together so much and had the same work ethic, values and the right skill sets that we created a partnership as a way to grow our business. Yes, we have to share what we make but we don’t have to spend money on strategy, web development, accountability, graphic design, brainstorming, photography, cheerleading, connection and fu*k it let’s doitness (know that’s not a word).

The dynamic we created together is more than you could get if you were paying someone for all the different things we can provide and also we push ourselves to learn more things. Just like running with a partner, we motivate ourselves to run faster and longer than we would on our own. We have to be super honest too about what’s working and what isn’t working about us and our business which keeps us out of denial which is handy when running a business.

It also totally helps get over the fear that stops most people going forward.

DO YOU ACTUALLY KNOW WHAT MONEY YOU NEED?

The first step is working out how much you need. This might sound super obvious but so many new business owners don’t take the time to work out how much they for their life and if their business model has the ability to make that for them in the time they have.

When people ask me if I think their idea is going to work I want to understand how they will make money. For example, a web developer asked me if it was a good idea to offer a package of a monthly subscription, to push out the payments of the website start-up costs and be available to make changes that she was always getting asked for after the site was up and the business was growing.

The idea was great but how much time would it take to do all that, how many clients could she take on at once, and what did she need to charge for it to cover her time and make her income goals.

At first, she was going to offer the service for a year but would need to double her prices, it seemed much better to cut the time to six months and also to get a larger one-off payment and 5 smaller ones to get her pricing to work. She then had the ability to double her customers’ capacity.

What to charge for your time is a totally different subject and depends on so many different factors but make sure you check that you actually have the time to make the money in. If you are charging for time, have you got enough time in a day to hit your goals? Can you double your prices and or halve your time?

I know many people who start with a price and then increase it when they are to capacity and constantly booked up. That way they give themselves the ability to show how good they are at what they do (often to themselves) first and then feel confident to charge more.

It’s also important to know how to market yourself to the people who can afford to pay what you’re asking and that’s a whole different subject too.

It can feel tricky asking for money from your customers or crowdfunding or feeling good making it. We have all had super awkward experiences around money but that’s not moneys fault. Mostly it’s the interactions with people, bad communication, lack of clarity and messed up expectations that have created those ‘money blocks’.

Money is petrol for your car and it can be empowering and liberating to go on that long-awaited business road trip of your dreams.

We are creative entrepreneurs with years of experience building successful and rewarding businesses for ourselves and others. Now we want to focus on You.

Making you and your business look, feel, sound and sell like a total rockstar is our secret sauce.