How to Start Your Business with the Right Funding and Structure
Launching a venture is thrilling, but securing the right funding and legal structure can make or break your dream of how to start your business. In an inspiring episode of the dreamBIG podcast by deAsra, Dr. Vikrant Bhujbalrao, a seasoned business coach and first-generation entrepreneur, shares practical wisdom on navigating these challenges.
His insights, honed from mentoring over 100 entrepreneurs, offer a roadmap for industry leaders to start their business with confidence. This blog, enriched by resources from deAsra’s blog, blends expert advice with practical tips on funding and formalisation, inspiring you to listen to the podcast for more.
Why Funding Matters for How to Start Your Business
Funding is the lifeblood of how to start your business. Dr. Bhujbalrao stresses planning for both personal and business expenses to avoid early pitfalls. “Many hesitate to start due to a lack of funds, while others assume external funding will fuel growth,” he says. A disciplined approach ensures you start your business with financial stability, allowing focus on growth rather than survival.
Planning Personal Finances
Before diving into how to start your business, secure your personal finances. Dr. Bhujbalrao advises setting aside “survival money” for six months to 1.5 years, sourced from savings or family support, not investors or loans. This buffer covers personal expenses, freeing you to focus on business development. Without this, financial stress can derail your efforts to start your business, making early planning critical.
Budgeting for Your Business
Business expenses require equal foresight in how to start your business. Assume no revenue for at least a year, as Dr. Bhujbalrao suggests. Create a financial backup to cover operational costs like marketing, production, or staff. This discipline ensures you start your business with a safety net, reducing the pressure to generate immediate profits.
Balancing External Funding Sources
Exploring external funding is part of how to start your business, but timing matters. “My advice is to plan for personal and business expenses for six months to 1.5 years,” Dr. Bhujbalrao notes. Angel investors, banks, or government schemes are options, but don’t rely on them initially. Start raising funds in parallel while ensuring self-sufficiency. This balanced approach helps you start your business without over-dependence on external capital.
Avoiding Funding Pitfalls
Poor financial planning is a common reason businesses fail. Underestimating costs or expecting quick profits can sink your venture before it grows. A clear budget, covering both fixed and variable expenses, ensures you start your business with clarity. Regularly review your financial plan to adapt to unexpected challenges, maximising the chances of success.
When to Formalise Your Business
Formalising your business is a key step in how to start your business. Dr. Bhujbalrao advises focusing on idea validation before legalities. “In the ideation phase, focus on validating market demand rather than diving into legalities,” he says. A simple proprietary or partnership firm suffices initially, allowing you to start your business without complex registrations.
Choosing the Right Legal Structure
Once your idea is validated, formalise to attract customers or partners. Dr. Bhujbalrao recommends a private limited company or LLP, especially for international markets. These structures enhance credibility and compliance, critical for scaling. Consulting a chartered accountant ensures you start your business with a structure that supports growth and meets legal requirements.
Timing Formalisation for Growth
Timing is crucial for how to start your business with the right structure. After validating your proof of concept (POC) and securing customers, formalise to target high-value clients. Compliance builds trust, opening doors to larger partnerships. This strategic timing helps you start your business with a foundation for long-term success.
Building Systems for Scalability
A structured approach from day one supports how to start your business. Dr. Bhujbalrao emphasises implementing systems early, starting with the founder’s discipline. Document workflows and processes to ensure consistency as you scale. Without systems, growth becomes chaotic, hindering your ability to start your business effectively.
The Role of Mentors and Teams
How to start your business is rarely a solo journey. Dr. Bhujbalrao suggests onboarding a mentor for guidance and a co-founder to share responsibilities. Early on, interns or volunteers can provide cost-effective support. As funds grow, hire skilled employees. A strong team ensures you start your business with the bandwidth to handle financial and operational challenges.
Measuring Financial Progress
Without early profits, tracking progress is vital for how to start your business. Set goals like validating demand and achieving sales targets, even if not fully profitable. Monitor cash flow and profitability metrics to gauge success. These numbers guide your efforts to start your business, ensuring you stay on track.
Overcoming Financial Hesitation
Fear of insufficient funds stops many from how to start your business. Set clear deadlines for financial planning and validation to curb overthinking. A lean approach—starting small and reinvesting early revenue—builds momentum. This mindset ensures you start your business with confidence, not hesitation.
Leveraging Government Schemes
India’s entrepreneurial ecosystem offers government schemes to support how to start your business. Research schemes like Startup India for funding or tax benefits. While not a primary reliance, these can supplement your financial plan. Combining personal savings with such opportunities strengthens your ability to start your business sustainably.
The Importance of Cash Flow
Cash flow is critical in how to start your business. Regularly track inflows and outflows to maintain liquidity. Dr. Bhujbalrao advises focusing on sales to keep cash moving, even if profits are low initially. Strong cash flow management ensures you start your business with the resources to grow.
Inspiring Action Through the Podcast
The dreamBIG podcast with Dr. Bhujbalrao is a goldmine for anyone exploring how to start your business. His practical advice, from funding discipline to strategic formalisation, inspires action. Listening to the full episode offers deeper insights into building a resilient venture, motivating you to start your business with a clear plan.
Conclusion
How to start your business hinges on robust funding and a solid structure. Dr. Vikrant Bhujbalrao’s insights from deAsra’s dreamBIG podcast provide a blueprint for industry leaders. Plan your personal and business finances wisely, formalise your time, and build systems early to start your business with confidence. Tune into the podcast for more inspiration and take the first step toward a sustainable venture.
FAQs
1. How should I plan finances when starting my own business?
Dr. Bhujbalrao advises setting aside personal “survival money” for six months to 1.5 years from savings, not loans, and planning business expenses assuming no revenue for a year. This ensures you start your business with a financial buffer, reducing stress and supporting growth.
2. When is the best time to formalise my business?
Formalise after validating your proof of concept and securing customers, says Dr. Bhujbalrao. Start with a simple proprietary firm, then move to a private limited company or LLP for credibility, helping you start your business with a structure that attracts high-value clients.
3. What funding sources should I consider to start my business?
Begin with personal savings for stability, as Dr. Bhujbalrao suggests, and explore angel investors or government schemes later. Avoid relying on external funds initially to start your business with independence and focus on building a sustainable model.
4. Why are systems important when starting my own business?
Systems, starting with the founder’s discipline, ensure scalability, notes Dr. Bhujbalrao. Document processes early to maintain consistency, allowing you to start your business with a foundation that supports growth and prevents future chaos.
5. How can I overcome hesitation about funding when starting my business?
Set clear financial deadlines and start small, reinvesting early revenue, advises Dr. Bhujbalrao. This lean approach builds confidence, helping you start your business with momentum and reducing fears about insufficient funds.