photo credit: alice_c

The concept of lean startups is gaining prominence in today’s economic scenario. The term lean startup stems from the term ‘lean thinking’ which means spending money wisely by identifying differences between value-added activities and waste.

Many startup owners commit the blunder of spending extravagantly as soon as they receive some funding. An advice here; even if a startup gets all money in the world, it won’t help unless you have a product or revenue model.

Funding shouldn’t be mismanaged; there is an ‘implied contract’ of getting the company to an agreed level in the hope of increasing the value of the business. The stakeholders in an early venture should also benefit for their contribution.

So, waste less on luxury items and develop a practical approach for creating and managing a startup that excels in low-cost experimentation, rapid iteration, and true customer insight.For a detailed insight, visit:
http://www.readwriteweb.com/readwritestart/2010/01/when-your-funding-is-your-wors.php

"In early-stage companies, you will regret such spending when you hit the bumps in the road where you wish you had that cash. Inevitably, you will hit such bumps. Plan accordingly."

Make sure you have a revenue model since the beginning and remember – ‘money should only be spent if it provides return’.