You can find many articles on the internet about how to get funding. In fact, you may have even gotten loads of advice on how to get venture capital from business leaders in your community.
The one problem, though, is few people tell you what to do with it once you have it. Let's take a look at things startups need to consider once they receive venture backing.
Plan Your Budget Wisely
Your venture capitalists are going to want an accounting of where you are spending your money. They will expect reports on your growth and money management as well.
Be sure to have processes in place so you can provide your venture capitalists with the info they’ll need.
This begins with your budgeting process. Make sure it’s as specific as possible. Once you’ve set your budget, you can outsource your accounting and reports management to an outsource firm.
Spend on Your Products
The number once place to put your investment capital is into your products. This is where most of your cash flow will go.
This may mean spending money on product development, top talent, packaging design, or production.
Spend Less on Other Items
Since you’re spending much of your investment capital on your products, you want to monitor your other spending very carefully.
Unless the design of your office matters to your customers, this isn’t the time to buy the most expensive desks, chairs and office furnishings.
You can be frugal when outfitting your business. Get creative and look online for the best deals.
Saving in the early stages of your business is vital to the success of your startup.
Spending venture capital on staff necessary to run your startup is also a good plan.
You will need a team to help you get your startup off the ground. Once you have venture capital, it’s time to bring people on to help you.
Make sure to hire the best team possible who believes in your mission, your products and your startup.
Create a Marketing Plan
So, you have the money, and you think you should spend a lot of it on advertising.
We advise some caution here as you’ll meet a great many agencies who will promise you results. Be careful not to get taken advantage of.
For many startups, hiring a small freelancer can be a good option. They usually charge less because they have less overhead, and because they are small, they can provide you more one-on-one service.
In addition, you’ll find many free or low-cost digital advertising avenues you can leverage.
Whatever marketing you do should be measurable. You’ll want to create a strategy and create goals that are attainable as well.
Test your advertising campaigns, and if they aren’t working, be sure and fine tune them.
Finally, make sure to measure your results against the cost. If it’s not bringing you the results and leads you want, it’s not worth the money.
Guard Your Time
Another thing to consider once you’ve received venture backing is that you’re the owner of a startup, and certain things are expected of you.
Your time is the most precious thing you have, and it’s up to you to spend it wisely.
The venture capitalists who gave you money expect that you’ll spearhead the whole operation and spend their money wisely. They expect you’ll grow and begin to turn a profit.
To do this, you have to manage your time well and concentrate on the big projects.
After you’ve received venture backing, your startup is on the fast track for growth.
You want to focus on balancing this growth while moving your startup forward carefully and with diligent planning.
Make sure you’ve set your priorities, done your research, prioritized your markets, defined your target audience, fine-tuned your products, hired top-shelf staff, and found experts to take care of your human resources needs.
Finally, have a plan for how to scale your business. Define your strategy and then execute it.
Are you a new startup ready to succeed? Are you looking to get your new business off the ground and watch it rise to success? We are here for you. We can help answer your questions and guide you through the process. Outsource your HR duties, finances, payroll and more to us. Contact Escalon today to get started.