One of the most important pieces of advice I received as a budding small business owner was to make every business decision as if I were the head of a well-established company.
Right from the beginning a start-up entrepreneur is under pressure to make multiple decisions on a long list of priorities. How will I pay for product development, equipment and staff? The list seems endless.
A business plan and budget helps to reduce project creep and avoid burning through start-up cash faster than what you had planned. But life is full of surprises. Unexpected events can change your budget priorities.
Here is where making budget decisions through the eyes of a long established successful business comes into play. The temptation is great to put off some expenses that seem less of a priority than others. That works as long as you are not putting off the things that will make your company successful ten, twenty or more years from now.
Protect IP Assets
A key piece of a start-up company’s value to its customers, collaborators and investors is its intellectual property. Not allocating adequate funds to register patents, trademarks, copyrights, and to have ongoing legal services to protect these valuable non-tangible assets and trade secrets is like gambling with your company’s future, not to mention those of your employees and creditors.
The small company that takes seriously the protection of its intellectual property will significantly lower risk factors for becoming a failed business. However, these same companies are forgetting that a key line of defense against IP theft is their staff.
Guard Against Cyber Theft
A major cause of IP cyber theft is from staff inadvertently introducing malware into a company’s operating system by mistakenly opening phishing emails or downloading content from compromised websites.
Educating staff on the value of the company’s IP and how to protect it would be a worthy expenditure with long-term benefits. But that won’t be enough in today’s world of higher risk factors for digital theft. Large and small companies alike have lost valuable IP and proprietary data because they put off installing state-of-the-art cyber security software.
As a start-up, balancing cash demands is a necessity. Knowing what expenditures are critical for the long-term financial health of the company is an important key to survival.