How to go broke.....profitably.

Introducing the boogie monster of all start-ups called Uncontrolled Enthusiasm.  Uncontrolled Enthusiasm has a big belly because he likes to feast on your time.

As a new business owner are you sick of hearing that cash is king?

Look at it this way.  You have to believe in the boogie monster.

Most start-ups fail because they ran out of time.

Time is the most expensive thing you need to start a business – and you need lots of it.

What buys you time?  Cash

You need to buy time because you don’t have control of time.

Sounds like a no-brainer.  Sure. 

 

Why then do so many new businesses come unstuck?  By not budgeting correctly - they didn’t budget for the cost of lost time.

A common oversight is to account for a series of events occurring, not including the cost of time.

Thinking that your new business will then perform according to a simple budget is a gamble.

Including the cost of time requires some realistic assumptions about external situations that will inevitably occur.

These assumptions can suddenly make a profitable budget look very sick.  That’s called real life.  Most of these assumptions are the compromises of starting a business.

Ignore them at your peril.  A profitable budget isn’t necessarily bankable.

Things get pretty heavy when you include the cost of time.  Questions about how you will make your business happen get tougher and tougher the more realistic the scenario planning is.

It’s bloody tough.  The romance of starting a new business goes out the window.  But you have to do this.  Survival instinct: how am I going to generate the cash I need to survive the events that cost me time?

Too hard basket?  Remember this: most new businesses went belly-up when according to the owner “everything seemed to be going so well.”

But it's not just start-ups.  At the moment, most small and medium businesses in Australia are operating only one event away from running out of time.

How-well will you spend what little time you have left?