July 14, 2011
By Khalid
Posted In
Business, Monetization, My Life, Projects
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“The deal isn’t a deal until the money is in the bank” – a saying my good friend Rob goes by. And it’s true…the money isn’t yours to spend until it belongs to you, even if all the T’s have been crossed and the I’s have been dotted.
But, what if the money in the bank isn’t enough? Do you save then spend, or do you take the risk and borrow money? For many startups the latter is often the case, but that’s not without its difficulties. I recently asked Santander for a £1,000 overdraft to help with cash flow in the event more money came out that went in, and I was refused. Yet, Barclays were more than happy to give a £6,500 credit card with all the bells, whistles and offers without even asking what the money was being used for. You can do some serious damage with £6,500 – you just need to remember the money isn’t yours and needs to be paid back!
Right now I’m promoting Edinburgh Taxi mainly, and things are going well, but every penny that comes in goes back out into marketing…and whatever else I have in my accounts! The money isn’t wasted, call volumes are rising month on month, but there’s only so much “cheap marketing” you can do. By that I mean low volume offline work and now I’ve come to a crossroads…
Do I…
a) patiently wait and save and stop marketing for a few months then do something big like a radio campaign?
or
b) pay for the big radio campaign on credit and pay it back over a few months?
Different people will have different views, and ultimately the decision is mine, but like any business decision there’s risk involved and it’s a choice. There’s alternatives sure, but with the increasing competition and rising costs of variables such as printing, man power, fuel etc, it needs to be done properly or not done at all and the costs come out the same.
The radio is simply an example of a big campaign I could do, there are others, but you need to alter your marketing to capture different markets and that’s where the difficulty lies.
So my question to you is; would you charge your credit card or would you play it safe and save?
