Starting up any business requires upfront funds to pay for expenses. Unless you are endowed with deep startup funds, business acumen, and/or incredibly lucky, this means your new entity will likely be in the red for a while. After the initial startup period of, say, a year, you should be asking yourself, “Am I making any money?” After all, you started your business to do just that. Right?
I may sound somewhat intelligent writing about it now, but I was not always financially savvy as an entrepreneur – although, as an employee, I was a very good manager of my take-home pay. Making a switch from an employee to becoming my own boss was like an apple trying to become an orange; i.e., there is very little in common in terms of the knowledge required to make it happen.
As someone new to the world of business, I was convinced that I did not have the time to worry about the money aspect of our business. After all, I was always funding my own startup businesses and, therefore, accountable only to myself. Consequently, money was the least of my worries. The fact is, however, most people, including myself, do not have a bottomless pit of money. Let me state the obvious: If you haven’t learned to make money within a reasonable period of time, sooner or later, you’re going to run out of it.
Hindsight is 20/20. Ignoring the money aspect of my business was a big mistake. Among the many mistakes I made during my journey to become and remain financially independent, the one that stands out as the biggest was not paying attention to whether or not I was making money consistently month in and month out. The sooner you learn to be net positive reliably, the quicker you will be on your way to building true wealth.
Happy investing!
