Spending that cash!
How much money do you spend on your business? If you’re like me, you spend money for things like servers, phones, and development. We all run different business, so we each have our own lists of monthly expenses.
Back in the day when I built my first site, I was spending money like a mad man; probably unnecessarily, too. I guess we sometimes feel that the more money we spend on our business, the greater chance of success for the business — but I’m not too sure if that really makes sense.
Sure, spending money on the necessary things like: phone, fax, servers, always makes sense to me. But when you’re talking about developmental spending, well, that’s a whole different story and you have to take into account your return on investment.
Forget about spending money for things to make your business “cooler.” Because the “cool” features and services will be remembered for a day while the “smart and efficient” features that were well thought-out, will remain as a powerful addition to your business, always.
I spent over $12,000 on my first business. At the time I was like “wow, I just spent all this money so the site will definitely work!” Too bad that’s not always the case. I went absolutely crazy adding “cool” features while forgetting about the features that would add real value to the company.
Always think, think, think before you spend, spend, spend. In the end, you’ll thank yourself and so will your clients because they benefit as well.
Bottom line: spend the money that you plan to grow your business wisely. Don’t spend cash just because you have it. Don’t add services and features just because your can. It’s not about how much money you spend, it’s about how smart you spend it.
I took me a few years to understand that. And I would be lying if I said that I am not spending a lot of cash on my latest ventures, but this time a lot of thought is behind every cent spent.
So spend smart and make sure that you’re always thinking about the return on each dollar. It’s all too easy to blow away cash nowadays, so be wise and spend it right!
So the question is: How do you spend your cash?
I most certainly agree with that. A start-up should always focus on getting it’s core features and getting the product to market before worrying about the cool add-ons. It should also try it’s hardest to lower it’s cost of acquisition as it grows. Great words of advice, as always, Dave!