At any given time a start-up company usually knows how much capital they currently have access to and what it is costing, in cash terms, to keep the business running. If your company is not yet profitable, dividing capital by the burn rate tells you how long the business will survive under current circumstances. It is a sobering and necessary calculation. With this in mind, here are some tips to make the most of your company’s cash:

• To the extent possible, limit the up-front start-up costs that get you from business idea to first paying customer. This may mean recruiting smaller accounts to start with and postponing the ‘big deal’ that requires months of marketing.
• Don’t make anticipatory purchases. Only buy and pay for assets and services when you are at the point of needing them.
• Focus on practicality over image. Don’t invest in expensive premises or equipment until your business can support the cost.
• Balance investment in workforce. It’s true that capital providers invest in proven team to an extent, but not every employee has to have years of experience and a corresponding paycheck. Hire enthusiasm and potential and provide the right training. Also, only hire the number of staff you absolutely require.
• Evaluate all financing methods that make cash stretch further. This can include leasing equipment instead of buying it or factoring customer receivables.

Always remember that bills are paid with cash, not accounting profits or potential and that monitoring the money going out is usually more controllable than predicting when the cash will start flowing in.