How to manage cashflow as a startup
Managing your cashflow is crucial when starting up - but it can be a daunting prospect for many businesses in the early stages of starting up (and, let's face it, beyond!) Running out of cash can be disastrous, but it's avoidable - so it's important to ensure you've got your finger on the pulse.
YC Ng is the co-founder of Scarlett of Soho, a subscription service for stylish eyewear. It's simple; you pay a fixed fee every month, and get to switch up your glasses frames whenever you like. The biggest challenge facing their business is cashflow, and knowing whether they should save for a rainy day or go all out to gain visibility. Watch the video below for advice from Sir Richard Branson, Sir Brian Souter, and Jimmy Cregan.
Sir Richard Branson, founder of Virgin
"Cashflow is make or break in a new company, or any company really – if you can’t pay your bills, you're out of business," advises Sir Richard. "Accelerating growth with little money is a challenge, but every entrepreneur has to go through the challenge. You have to be inventive and come up with every idea to expand when you have little cash."
Sir Brian Souter, founder of Stagecoach
"In the early days it’s best to manage on a cash basis until you get that credit history. The way to get a credit history is to pay your bills on time. Do that and you’ll find suppliers more willing to give you credit, as you’ll have built up trust with them."
Jimmy Cregan, founder of Jimmy's Iced Coffee
"Limited resources can actually be stretched a bit further - just use your imagination to stretch it as far as you can. Try not to grow too quickly, and then you won’t have to worry about doing big things in the near future, which can feel really daunting."