HOW WE AVOIDED DEBTS FOR OUR STARTUP

Posted by vishwajeet s baghel on June 3rd, 2019

HOW WE AVOIDED DEBTS FOR OUR STARTUP.

“Use other’s money to make money for you” this line was a constant lesson for me by

grand businessmen of the families i grew up with.

So, loans,credits and borrowing are vital and common terms in daily life as well as business life but questions always occur on how much? or how far? We can rely on debts.

Excessiveness of anything causes harm and same applies with debts as in our journey to be a profit generating company from a ready to sink in debt startup we have learned few basic mantras of avoiding debts.

Let us take it step by step;

1. Accept what’s coming your way.

                                                                               Most of the time we get to know how we can tackle the needs of debt during our working but it’s also important to keep in mind the debt fact before we even enter into the ring of market.

Having a reality check that you going to need debt in future for sure and you have to be a solid mind person or better say entrepreneur to take care of how much debt is sufficient and realistic .

Psychological preparation for good and bad will absolutely going to help in you long run.

 2) BUDGET.

                I learned about budget from my mom ,maybe you also remember term budget from your household too.

But when it comes to business most of our spendings are predefined but the amount isn’t , here comes our skills of making a budget that will allow us extreme efficiency.

Where controlling cost will keep you far from debts.

3) SINGLE SOURCE DEBT.

                              When you are opting for loan keep in mind to satisfy your demand from a single place .

As every loan needs repayment on monthly basis and managing a single source where you have to repay is much less difficult than taking care of multiple ones on different dates of month and interest rates.

4) PRIORITISE.

                    Prioritising is the key to distress, in debt case prioritising is as much important as in life.

It is a very practical situation in initial days of startup where you can only pay a limited number of debts from your revenue.

In this situation you have to see that which debt will harm more if remains unpaid like power bills,taxes and maybe court fines.

On the other debts like overdrafts and loans for a short time will only cause you  a penalty amount which is quite payable .

But still all this is working only for a short period of time and overdues for long time is a serious harm.

5) CUT THE EXTRAS.

                                You never want an extra problem in your life which isn’t going to benefit you at the end of solution.

Same is with expenses, people pay more and than end up into debts for purchasing.

Analyse your needs and see what can be altered with a lesser cost .

Like second hand machinery or leasing assets for short term use.

DON’T PRESSURISE YOURSELF,EVERY STARTUP AND ENTREPRENEUR IS DIFFERENT .

At the end i would say that most of the time we try to chase others and ends up doing our no good and sometimes harm too.

Understand needs of your startup and work like that and take decision on that basis other than comparing with others or taking decision like them.

We hope this article would have been an useful read for you.

Regards

Team Revolutionary startups .