Startup history abounds with stories of entrepreneurs who made it big on shoestring budgets. Spanx founder Sara Blakely began her shapewear business in the 1990s with just $5,000 in savings, and Nike co-founder Phil Knight famously paid just $35 to the graphic designer who came up with the company’s iconic swoosh logo. Many big business owners became successful by keeping costs low and staying frugal, according to best no deposit bonus casinos.
Today, there are more ways than ever to save money as a new entrepreneur. Here are four strategies for startups to keep their finances healthy as they grow, curated by experts from www.casinoroar.com.
Equity vs. Salary
The easiest way to save money is to do everything yourself, which is why entrepreneurs often wear many hats. However, this becomes less feasible as your business grows. Sometimes you simply don’t have all the skills necessary to get your startup off the ground. Even a brilliant marketer like Steve Jobs needed Steve Wozniak’s technical skills to bring his ideas to life.
But what if you don’t have the resources to pay someone a salary or consulting fee? In that case, you may consider granting partners and early employees equity in your business. This is a common tactic among startups that don’t have the cash to pay for salaries, although you should keep in mind that this dilutes your stake.
Social media
Social media and user-generated content platforms, such as Facebook, Instagram, YouTube and TikTok, consume an increasing share of Americans’ leisure time. You can use these platforms to reach new customers more efficiently than you could with traditional forms of advertising, often at a fraction of the cost.
But if you’re creative, you can leverage social media to reach a large audience for free. Although there’s a lot of luck involved in generating viral posts, you can increase your chances by creating content that brings value to an audience. Whether it’s an informative how-to video showing off your business’s services or a funny skit that incorporates your product, consumers often respond better to tactics that don’t feel like blatant advertising.
Minimizing taxes
At some point, you will want to consider organizing your business as an LLC or an S corporation. Forming an LLC will protect your assets in the event of a lawsuit against your business, but there can also be tax advantages. LLCs and S corps are pass-through entities, meaning your business’s income is treated as personal income for tax purposes. For states with high corporate tax rates, this can avoid the double taxation issue, which occurs when a business’s income is taxed at both the corporate and individual levels.
On the other hand, C corps are first taxed at the corporate level, and any salaries paid out are taxed at the individual level. This might be an advantage in states such as Wyoming, Nevada, Texas and South Dakota that have a zero corporate tax rate. C corps also allow businesses to deduct certain expenses. Research your local tax laws and regulations before choosing which structure to take on.
Cash-back cards
In the early days of Airbnb, co-founders Brian Chesky and Joe Gebbia maxed out numerous personal credit cards to raise money. Although we don’t recommend going that route, credit cards can save you money when used wisely.
Many cards offer sizable signup bonuses, usually in the form of points or a statement credit if you spend a certain amount of money within the first few months. New businesses often spend money on products, office supplies and software licenses, so you probably won’t have any problem meeting the minimum spending to earn the bonus.
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