The current financial crisis is rocking the business world, but start-up businesses have a special challenge: how to keep growing while trying to stay afloat.
With that in mind, here are some tips to stay ahead of the game during the financial crisis. While this list was written for the US publication Cnet, some of these suggestions will no doubt apply to you and your business.
1. Don’t rely on advertising. If your start-up relies heavily on advertising revenue, don’t exclusively expect it to keep your business afloat. When there’s less consumer spending, advertising declines, so make sure your contracts are sealed and you have a plan for the months ahead.
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2. When searching for revenue, you may want to consider selling to businesses. While it’s harder to sell to businesses than individual consumers, you’ll be rewarded with slower churn and predictable margins. Make sure your sales team is up to scratch!
3. If you want to sell to a business, make yourself credible. No one will trust a start-up with little experience, so partner up. Join a business with more experience and you’ll likely have a better chance of selling your products or services than if you worked on your own.
4. Focus on angel investors. And forget about venture capitalists for early stage development.
5. Conserve credit! The difference between now and the 2001 bust is that credit is even scarcer, so lay off on unnecessary spending and stock up for your business’ hibernation period.
6. Go with the flow. Don’t be scared into retaining all your credit and never spending a thing. Watch the markets and go where they go. If the economy doesn’t look set to recover relatively quickly, move to a booming one.