You get a business loan shortly after opening the doors of your tech startup and have some great plans regarding how to use the money. However, you need to be careful as you may not see the profits you want to right away and the loan may be all you have for a little while.
Therefore, you need to spend wisely. Below are 5 ways a business loan can help your tech startup and smart ways to spend it.
Knowing what your staffing needs when you first start your business can be challenging. You may be only able to afford the wage of another person in addition to you at the start, but what if business picks up to the point where you need another body?
Using a business loan to finance hiring another needed staff member will definitely benefit your tech startup. By hiring the services of a recruitment agency who can look after the process from start to finish and find you the perfect fit, you can rest assured you will get the right person for the job. Having another staff member also means you can extend your repertoire of services offered and your business hours so you can help more customers.
2. Modern equipment
Having the most modern, up-to-date equipment available may not be the most important things when you start your tech company. However, customers upgrade their technology every day. If you are unfamiliar with their systems, you may not be able to help them and they will turn to your competition for their future needs.
Investing in the latest technology and equipment is a great way to help your customers because it will allow you to offer the highest level of service. Whether it be computer systems, servers, web-hosting tools, or security components depending on what type of company you are, the equipment you have and use will allow you to serve customers no matter type of technology they have. When you invest in technology, you will also be receiving the tools you need to make your processes more efficient.
As a new business owner, you may not have the skills needed to allocate funds to needed areas and manage the profits that start to come on. While you may be able to manage your finances at the start, failing to seek the services of a dedicated and helpful professional could result in failure.
An experienced accountant will balance your books for you, ensuring you have more money coming in than out. He/she will make sure every financial obligation is taken care of, from renting office space to paying utility bills to purchasing supplies if required. As an entrepreneur it may be tempting to spend profits as quick as you make them. An accountant will hold you accountable, making sure you can afford the purchases you want to make.
4. Legal services
You launch your tech startup with only the best of intentions. However, legal issues can arise and when they do, you will need the services of an experienced attorney. Even when things are going right it is beneficial to at least know where to turn for any needs that involve the law.
When first starting a business, you need to register a name and maybe even a logo or slogan. To ensure your choice will not infringe on any existing copyrights, your lawyer can do a search to guarantee you will not face a lawsuit in the future. A lawyer can also help you with taxes and take care of any situations where customers hold you liable for any inconveniences or damages.
You are confident in your ability as a business to help customers and provide the best service possible. However, you will not get customers if no one knows you exist.
When first launching your startup, be sure to advertise your location, contact information and services that you have to offer. Because you will want to use platforms such as television, newspapers, public signage, and social media, it will cost you a little bit of money up front. However, using your business loan to pay the costs will allow you to have the exposure you need to get customer’s attention.