For Sam Zherka, inefficient cash flow management is one of the biggest mistakes that startups make. It doesn’t matter where your funding came from, or how much money you have. When you’re in the initial stages of your startup, cash flow management is critical to survival, Sammy Zherka says. Sam Zherka didn’t become a successful businessman overnight, and it surely didn’t happen because he had money to burn. Sammy Zherka didn’t start out with a fat checkbook. He struggled and hustled just like everyone else. So how did Sam Zherka find success after success with all the businesses he’s established? He managed his finances the right way.
Whether you’re still in the initial stages of your startup or you’ve successfully established it, Sammy Zherka hopes you will find his nuggets of wisdom below helpful:
1. Start with a lean team
Your overhead expenses take the bulk of your cash flow, so when starting a business, start with a lean team. You don’t need a bunch of people to get your startup off the ground; what you need is the right people. Many startups were successfully launched by a two-man team, which only means that it’s not the number of people you have on your team, it’s having the right people.
2. Take stock of fixed costs
Just as you picked a lean team for your startup, Sam Zherka recommends that you go lean on your operations as well. As Sammy Zherka mentioned above, your overhead expenses take the bulk of your finances and as such, you must be careful about fixed costs. These include rent payments for your office space, utilities, employee perks, and salaries. You don’t need to go over-the-top on these operations essentials initially. You can upgrade when you’re more established.
3. Know where all the money is going
In any business, remember that every dollar counts; more so with startups, adds Sam Zherka. Keep track of all your expenses, including additional and unforeseen expenses. Sammy Zherka suggests that you invest in accounting software to help you stay on top of your finances. It’s also important to monitor these yourself. While you may have a good accountant or bookkeeper, make it your top priority to stay on top of your own spending.
Remember these tips and use them to your advantage. Efficient cash flow management is critical to your success, adds Sammy Zherka.
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