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How to make your startup a success?

Startups may be small entities but play a key role in strengthening the economy. India has been witnessing a startup boom, especially in the IT sector. As many as 1,300 startups were added to the ecosystem between January to November 2019, taking the total number to 9,300, according to a report published by leading IT and BPO trade association NASSCOM. The report also went on to say that these startups had created around 60,000 direct jobs and up to 1,80,000 indirect jobs.

Although there are sound business banking solutions in India, startups often feel cash strapped and unable to leverage opportunities. If you’re part of the startup ecosystem and wish to gain a strong foothold, here are some useful tips.

Pro tips for startups

Did you know that startups raised a whopping $1.6 billion (₹113.5 crores) in series A and B funding between January and November 2019? This marked an increase of 70% versus the same period in 2018. While there are several windows of opportunities for startups, these entities need to overcome some common financial obstacles.

Rely on business banking solutions: Some entrepreneurs seek funds from unorganized money lenders. They are not aware of what is business banking and its many benefits. Banks offer various accounts and deposit schemes customized to meet the unique needs of smaller businesses. These may include mobile banking, bill discounting, doorstep banking and business banking debit card in India.So, when planning the finances of your startup, find out what is business banking and how you can benefit from it.

Have a stringent payment collection process: Many startups face liquidity problems not because of the shortage of orders but due to delayed payments from clients. Don’t hesitate to mention credit timelines and collection process with customers when accepting orders. Offer a discount for clients that can help make the payments early. Make it simple for customers to pay online by opening a business banking current account. List all open invoices and follow up on them regularly.

Estimate your cash shortage: Always be on top of the status of accounts payables and accounts receivables. It’s also important to estimate the time lag between these, so you have an idea of your cash flow needs. Once you’ve estimated this, have an idea of ways to meet these needs. For instance, the overdraft facility on your business banking current account offers easy access to funds when you most need it.

Negotiate with vendors: While the size of your business is still small, don’t underestimate your negotiating power as a client to your vendors. Try to get as long a credit period for making payments as you can. Despite having the best business banking solutions, getting a longer period to make a payment to vendors can be worth much more than discounts they offer.

Startups face stiff competition, even if they are addressing a niche market. Moreover, a small team requires every member to be proficient in various skills. While being an entrepreneur can be an exhilarating experience, it also means you take on financial risks. Providers of business banking solutions in India have financial experts. So, don’t hesitate to take advice from them.