Financial Planning Tips to make sure your start-up survives

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5 Financial
Planning Tips
to Make Sure
Your Start-up
Survives

2. In the past decade, the number of startups in India has increased owing to easier business entry
hassles, simple legal constitution, and good funding support from VCs and Angel Funds. That said,
like individuals, even startups need to perform their financial planning to survive.
Following are 5 financial planning tips that will make sure that your startup survives:
Make your business scalable to take it globally
The way business is performed has undergone a major transition in the past 2-3 decades. Today,
focus has changed from managingthe business from end-to-end to increasing focus on one or two
key processes that could help build a competitive advantage. It is more often this competitive
advantage that makes a business model scalable, which helps takes a business global. For instance,
Mark Zuckerberg just focussed on creating a content management company with zero content of its
own. With this focus in mind, he grew his startup – Facebook into the world’s largest content
management company with zero content of its own, making this a competitive advantage.
Therefore, making your business model scalable is the first step for survival.
Get a stronger hold on your cash flows
Cash is a crucial element for business and even more important for startups. As a startup, you need
to ensure highly frugal cashflow management and map your cash flow closely to your profitability.
Thus, any cash flow that is not generating business profitability should be avoided since it can
hamper your business prospects. Startups must appoint consultants and not full-timeworkers since
this could save critical cost to company, helping them survive in the long run.
Explore startup funding from Alternative Investment Funds (AIFs)
AIFs have become an increasingly popular alternative funding source to the banks in the past
decade. Today, Venture Capital Funds and Angel Funds increasingly invest their money in startups
with bring business prospects. Thus, as a startup, you must explore AIFs as an alternative funding
source to stay afloat in the business. Moreover, VC Funds and Angel Funds also act as business
mentors that not only provide you with appropriate guidance, but also help you build your client
network.

3. Work towards going public through IPO
One of the best ways of generating funds for pan-India business expansion for startups is to offer a
share in its company to the public through an initial public offering (IPO).IPO allows a company to
invite people to invest in its business by providing with the ownership stake to their extent of shares
subscribed in the business through the IPO.Thus, IPO allows a startup to list its company on popular
stock exchanges such as the BSE Sensex and NSE, enabling them to trade its shares publicly in the
open market post listing. This is one of the best ways of survival for a startup.
Get your startup SME or MSME status
There are certain eligibility criteria that a startup needs to satisfy to be termed a Small and Medium
Enterprise (SME) or a Micro, Small, and Medium Enterprise. Once you satisfy those criteria as a
startup, you can benefit from SME listing, government funding help, and other benefits. This could
be important for business survival.