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Taking the plunge and joining the raft of South Australian start-ups can be an exciting but nerve-wracking time. It’s no secret that the start-up economy is booming and has become a staple part of Australia’s growth.
According to the latest Startup Smarts report, the sector raised an impressive $568 million in 2016 – this suggests that the sector raised more than 73 per cent on the previous year.
The start-up market alone is projected to create more than half a million jobs in the next decade.
Well, if it has, there are a variety of factors to consider if you are thinking of starting up your own business.
Here are our top five financial tips for South Australian start-ups:
Budget planning & council approving
Before we get into the nitty-gritty of looking at your finances, you need to ask yourself: ‘’Is this something I really want to do?’’
Running a start-up can be demanding and push you to your limits, but if you have faith in your business idea and have the drive and determination to succeed, then read on.
Capital is usually one of the biggest challenges for start-ups. Then once you’re running you have the challenge of managing your cashflow… but let’s not get ahead of ourselves.
A great financial tip for start-ups is to have a search around and see if you qualify for any grants or bursaries.
Have a look at Government-accredited initiatives and see if your new business venture qualifies for any extra income to help you get set up in the early months.
If you are looking specifically for a Government grant, then you can have a look at the Federal Government Grant Finder.
Apart from Government grants, another viable option for that cash injection into your new company is to source investment through crowdfunding.
There are a variety of meetups, forums and discussions available in Adelaide that allow you to consider crowdfunding as an option.
Have a look around at what is available and base your judgement through the information collected.
Crowdfunding can be a good start to help get yourself on your feet, but bear in mind that competition for investment is fierce and for every crowdfunding success story, there are hundreds of campaigns that gathered no traction.
If you have a sound proposition, backed up with a cast-iron business plan, you should consider looking for financial backing from private investors. Our number one tip if you plan to pitch your business to investors is know your numbers upside down and back-to-front!
Most investors will rightly want to deep dive into your financials and projections and they have little time for half-baked calculations or unrealistic projections.
A great financial tip for start-ups is to really scrutinise every purchase and keep on top of your total expenditure.
Okay, you might need a new laptop, or a new piece of machinery; but can you buy those second-hand?
Do you really need to buy that brand-spanking new iPhone or put dinner on the company card?
There’s much to be said for the ‘lean start-up’ philosophy.
The greatest financial tip of all for start-ups is to speak to an expert business advisor.
We at Altitude Advisory have worked with many start-ups and, in turn, have helped them propel themselves forward in their fields.
We can help guide you to make the right choices and investments with your time and money. Whether that may be pursuing extra funding, hiring extra staff, tax and accounting, or monitoring your cashflow, we will always endeavour to get the results you expect.
An expert business advisor can help you plan, maintain and execute a financial plan that will help you generate a return on your investment.
Rodney Quinn, Quinn Transport
Phillip Cross, Royce Cross Agencies