It’s easy for new business owners to get overwhelmed. You’ve seized a fantastic idea and you’re bringing it to life, but there’s a lot on your plate. At the same time, if you slouch on record-keeping or don’t spend money judiciously, you’ll crash and burn. And if you focus too much on the finances, your product or service will suffer.
In order to prepare the financial statements, it is important to adhere to certain fundamental accounting concepts. Going Concern, unless there is evidence to the country, it is assumed that a business will continue to trade normally for the foreseeable future.
Manufacturing startup Fab provides an infamous example. As Alyson Shontell starkly explained to Business Insider, “Jobs created then lost: 500. Value created then lost: $850 million. Money burned: $250 million.” Shontell also chronicled the end of Clinkle, a payments startup that dramatically failed to build and release an app somewhat like Apple Pay. I’d also bet you’re familiar with statistics that show 50 percent of new businesses fail in the first year and 95 percent fold before the five-year mark.
With so much at stake and so many information streams to track, what should you be on the lookout for?
With so much at stake and so many information streams to track, what should you be on the lookout for? It boils down to wisely managing the money inflow and outflow — while keeping your other eye on building your core business. It’s tough, to be sure. It’s also a necessary skill for anyone working at a startup.
Here are eight tips to help get a handle on it all. [READ MORE]