How much should you raise or take loan after basic investments?

Small businesses and startups (mostly service-oriented) ask me for how much should we raise or take loan after basic investments? Here’s a simple math that works fine:

Base money: Get expenditure for the next 6 months covers (this is min. Better is 12 months)

Wastage: Get additional 20% for wasting charges (all company waste money in additional stuffs not needed) Lo an installments: Make sure you don’t have installments from day one. Else include them too.

What to do in these 6 months?

Do enormous tests: assign 10 customer/sales to each test depending on your product or service. each test shouldn’t go beyond 2-3 weeks. take a note of everything you learnt from these tests.

Prepare a plan: now take a list of approaches you are going to follow from your observation of your test.

Define target market: Keep only 1-2 in mind and washout everything else.

What to do in next 6 months?

focus, focus: Scale up on that target market and on that approach, while experimenting narrowly on side.

Do scaleup investments: hire, productivity tools etc.

If needed take another funding for 6-12 months: Make sure you are doing good in that.

Hope it helps. Please if it was helpful signup and make other small businesses signup at: https://www.slickaccount.com

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