As the old adage goes, "Well begun is half-finished." If you start your business out on the right foot - which means with enough capital to get it up and running without being pinched for cash - your chancer of success soar. Part of the puzzle involves start-up costs for initial inventories, leasehold improvements, licenses, and all th other one-time costs that you will incur when you start up your business.
You can hold some of these costs down by using secondhand or borrowed equipment, renting space, and leasing equipment instead of purchasing. But the total amount will probably be more than you expect. Don't underestimate what you might need.
The dangers of under capitalization cannot be too strongly emphasized. Get the real figures. If they are manageable, great. If not, perhaps you can find ways to lower them. Don't plow ahead until you are pretty sure that you can afford to go to into business.
Use your cash-flow projections to determine how much capital you really need. Look for the deepest cumulative cash-flow negative point. A rough rule of imately how much capital your venture needs.
You can hold some of these costs down by using secondhand or borrowed equipment, renting space, and leasing equipment instead of purchasing. But the total amount will probably be more than you expect. Don't underestimate what you might need.
The dangers of under capitalization cannot be too strongly emphasized. Get the real figures. If they are manageable, great. If not, perhaps you can find ways to lower them. Don't plow ahead until you are pretty sure that you can afford to go to into business.
Use your cash-flow projections to determine how much capital you really need. Look for the deepest cumulative cash-flow negative point. A rough rule of imately how much capital your venture needs.
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