When you're experiencing unprecedented growth, losing track of your budget can be one of your biggest challenges to tackle. This is ironic considering that a lot of what's going on with your startup building is going right - your customer base is growing at the speed of light and there is a steady (if not, exponential) increase in your earnings.
That said, budgeting is an important aspect to ensure your business is growing at a healthy and sustainable pace. Budgets also prevent you from inadvertently draining your capital, affecting your cash flow or making poor business decisions due to a lack of insight on your startup's financial situation.
Simply put, budgeting is key for your startup's success and longevity. Similar to how you wouldn't launch a business without enough capital in your arsenal, keeping track of your budget and sticking to it is key to ensure that your business continues to grow without overspending on expenses which might eventually exceed your revenue.
Besides that, as a rule of thumb, it's highly important for founders to know the ins and outs of the financial strength of their business. Not only does it inform you on how to scale up without it being detrimental to its growth, it also comes in handy when you need to pitch to investors for your next fundraising round as they would want to see your financial statements to find out how your startup is performing.
To be on top of your startup's finances, keeping a sharp eye on real-time insights is your best friend. However, this depends on whether your business account provides the capabilities necessary to give you the spending data you need to make strategic decisions and understand where money could be better spent or saved altogether.
Using all-in-one financial tools like Aspire will streamline your financial processes by giving you access to the real-time insights you need at your fingertips, ready to inform you on your next big move at any time of the day.
The timeless adage rings true here, especially when it comes to business - failing to prepare means preparing to fail. Unexpected expenses are just part and parcel of building and growing a startup. It's best to prepare for it instead of being blindsided when the time comes. The last thing you would want is to compromise a spend category you've set aside for something important to cover for the shortfall. One way is to project your cash flow by creating a 12-month cash flow forecast so you can strategize quickly and adjust when you come across any financial difficulties.
As with all fast-growing businesses, certain budgets that you've set aside for recruiting and marketing could go up more than you initially thought, especially if customer demand is growing month on month, thereby requiring more and more resources. This would involve hiring more people to support your team or investing more in customer service tools-either way, it's going to cost a chunk of money for these workflows to be put in place.
Plan ahead for this by giving these budget categories more breathing room so you wouldn't feel caught off guard when the numbers start going up. When budgeting, be sure to allocate more space to cover these unexpected expenses by using real-time insights you have gathered from Aspire's all-in-one finance stack. Just a glance at the how much is spent on the different categories could shed light on what could easily go up when demand goes up-and prepare accordingly from there.
When your business is growing faster than ever, it's understandable that company spending is growing at a faster rate as well. This is where Aspire's expense management can come in handy. Should you find that there's a need to put a cap on specific spending categories, Aspire allows you to stay in control by adjusting your spend limits at any time. Doing so would mean you'll never have to worry about going over-budget as your company grows.
Avoid budgeting challenges for your startup altogether when you sign up for the Aspire Business Account. Simplify your expense categorization with the expense management feature and track your profit in real-time through the mobile app. In all aspects of your business budgeting, we got you covered.
You may also be interested in: The Complete Guide to Business Budgeting and Budget Management (Downloadable)