For startup founders, the term ‘runway’ has a different meaning compared to what most people think of when they hear the word. If you’re unfamiliar, the term ‘runway’ in business refers to the amount of capital on hand for a startup company before going bankrupt.
Usually, the runway is measured in months. Bootstrapped startups are companies that do not have any venture capital funding; in this case, running out of runway can be a very serious situation that could limit the decisions that you’re able to make in regard to your company. Fortunately, there are several strategies that bootstrapped companies can take in order to stay afloat and save money.
Employ Remote Workers
Any startup entrepreneur will know just how difficult it can be to reduce fixed costs. When it comes to driving your regular, fixed operating costs down, one of the best ways to do this is to become a company that employs remote workers. There are several benefits to be had when it comes to employing remote workers – whether they are full-time employees or freelancers.
Not only will you have less fixed costs to pay out in terms of office utilities and space, but studies have shown that employees who are given the chance to work remotely tend to be more satisfied with their work and productive in their role. In addition, remote workers may be able to cover more unsociable hours, or you can hire workers from around the world, allowing you to prolong your business’s working hours at no extra cost.
Take Advantage of Word of Mouth Marketing
When it comes to spreading the word about what your business has to offer, word of mouth marketing is one of the strongest and most cost-effective methods of doing so. A great way to do this is to provide your satisfied customers with incentives for getting their families, friends and acquaintances on board.
Some examples of this are to offer money off vouchers, or free products or services for both the existing and the new customer if they sign up using a link that you have provided your customers with to share.
Seek Out Money Off Vouchers
Money off vouchers aren’t just for making savings in your home and personal life – there are several ways in which they can be used in your startup to drive costs down and save money. For example, if you are looking for office furniture or supplies, you might want to research online deals first to see if you can get what you need at a lower price.
Don’t shy away from buying second hand, either – whether you need chairs and tables for your office or new computers, you can save a significant amount of money by opting for pre-loved items that are still in a good working condition.
Implement a Culture of Frugality
Encouraging a company culture of being frugal and saving money wherever possible from the very start will help your new business save money in every way. Employees who are used to prioritizing frugality and keeping costs low throughout their regular day at work are more likely to keep these habits up, which will help your business spend less and save more well into the future.
Even the smallest of habits, such as switching lights off in rooms that aren’t in use or keeping doors and windows closed as much as possible to regulate temperatures can make a huge difference to regular expense levels.
Bootstrapping startups have to seriously prioritize saving money in order to avoid financial troubles and encourage future growth. These strategies will help you save money while still being able to invest in the important aspects of your business.