Business ownership: Startup challenges and opportunities

Feb 08, 2023

Key takeaways

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Your time is valuable. Balance the work of product development and team development. 

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Understand cash projections and funding options is critical. 

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Understanding technology now can help you scale your capabilities later.

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Startup challenges and opportunities

You’re refining your idea and modeling your business. As you invest in your product, you’re probably losing sleep over cash considerations. How much do you need? What’s your burn rate? Which type of financing will work best? While you’re elbow-deep in those issues, be sure you’re also asking yourself these critical questions.

Questions and answers:

Best practices for owners of growth stage businesses

People, process, and technology

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Time is critical at this stage. Can you afford to spend your time managing people versus getting your product ready?

Best practice 

Outsourcing can help you focus on the product and market while others ensure the business is in compliance and ready for your next move.

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Most startups will need additional cash before they get to market. The faster you can procure it, the steadier your forward momentum will be.

Best practice 

Understand your available options and build relationships with investors and bankers. By projecting cash uses, you can more clearly see when you will reach that minimal viable product point to start bringing money in the door.

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Many founders at this stage believe technology is too expensive.

Best practice 

Take the time to make a minimal investment at startup so you can scale your tech capabilities as your business moves forward.

Tax tip

Protect your personal wealth. For business owners who have already accumulated significant wealth, consider starting your new business in a trust for your heirs’ benefit.

This will allow the value to grow outside of your estate and protect the wealth that you have already generated from what is usually a riskier investment.

Look for research and development credits. Research can often be a large component of startup. Certain R&D expenditures may be eligible for a tax credit. While the credit is often related to income generation, there are exceptions and elections that can provide a benefit to organizations that are not yet profitable.

Explore all five stages of the business owner lifecycle

How do entrepreneurs address the various lifecycle stages of business ownership?

Owning a business takes a certain confidence and grit.  All owners are different, but all face similar challenges.  Our business ownership lifecycle ebook shares insights gleaned from helping business owners face these challenges head on.