11 Golden Tips To Cut Costs When Launching A Startup

Launching a startup can be very expensive. In the last few years however the cost of launching innovative projects and web startups in particular has dropped dramatically. What you usually need to spend on is: hosting, domain registration, help from friends and a “big garage”. What is really important is to be patient and find a niche for your service or product. Many people get discouraged because of entry costs in markets and costs of creating and launching a startup.

Let me tell you how you can cut costs easily:

1. Look into projects according to your background.

The best way to save money is have a proper knowledge of the industry and the products you are going to provide. If you are an engineer try to stick to your background; biochemistry or astronomy will probably be something to avoid especially if you don’t have anyone with such knowledge in your company. The key to success is competitive advantage which derives from unique abilities and skills.

2. Ask your family and your friends to comment on the project.

You family and your friends will always tend to be subjective, but their advice will be free. Asking “what do you think about it?” will allow you to identify potential opportunities and serious mistakes. This could be vital.

3. Observe competitors before spending money.

This is something that I always stress. Don’t create another Youtube or Google, focus on innovation. A good solution is to avoid cloning, but invent something new every time. The only exception that comes to my mind is cloning from one country to another. Fotki.pl for example is very similat to Flickr.com and is a polish clone of it. This site is very popular and in this case it turns out to be a good approach to business.

4. Keep your ideas secret.

It usually takes 2-3 weeks to clone a project. Your ideas are the most important thing in the whole company. Never share all your ideas or you will end up with nothing. Competition is fierce and big players in the industry are always one step ahead, so be careful.

5. Negotiate with suppliers

Cutting costs by negotiating with suppliers is extremely important. Your bargain power at the begging is very low but if you are cunning you can find special opportunities even in competitive markets.

6. Don’t tell media what you are doing in the first stage of your project.

This point is connected with point 4. If you tell media about your ideas they will do exactly, what you planned to do. Marketing comes next, first concentrate on the product.

7. Be flexible.

If you see that there is something to be changed, change it. There is no point being stubborn. Be critical and you will be able to optimize your product or service.

8. Spend more time thinking than doing

It doesn’t matter how much time you spend working on a bad project. It’s better to wrok an hour on a very good idea than 24 hours on crap. “Quality is the king”.

9. Be ready to give up when everything goes wrong. There are thousands of project to look at.

This point is vital to survive. Risk diversification and project selection will take you out of major problem. If something goes wrong, switch to something diffeent.

10. Run a blog to keep in touch with users.

Keep in touch with customers. It doesn’t matter how you do, but they have to know that you are able to support them in case something goes wrong.

11. Don’t hire, outsource instead

It is always a good idea to focus on the core business. If you need to have something done from someone else, especially from time to time, try to avoid hiring.