Risk is an inevitable part of running a business. And as the saying goes, without risk, there’s no reward.
As a founder of a new Pakistani startup, you must be prepared to take some degree of risks. However, unnecessary risk is never a good thing, and there are measures that you must always take in order to reduce early-startup risks.
Here are 5 ways to reduce risks that may pose a threat to the survival of your new Pakistani startup:
5 Ways to Reduce New-Startup Risk
- Align the Service Offering with Your Skills
Your new business product or service should be something that you have the skills to manage and serve yourself. While it is always a good idea to grow and innovate, it will benefit you to start with something you know. There’s always time to scale the business once you get a solid footing and mitigate survival risks.
- Have a Backup Stream of Income
If you leverage your business in such a way to start earning money fast, you won’t have to keep a second job for long. However, at the beginning, it is extremely beneficial to have a backup stream of income. This will reduce the risk of startup failure, and will give you a cushion to invest capital into the startup if it is absolutely required.
- Avoid Unnecessary Expenses
There are a ton of expenses and costs that go into starting a new business. Equipment cost, salaries, patents or copyrights, and overheads are just the beginning. However, it is crucial to keep an eye on your bookkeeping records and eliminate any unnecessary expenses in the beginning. And even better, avoid those expenses before they occur. A great way to track expenses? Use the Metric app! Metric allows you to track and input expenses in real time, including simply adding a photo of a receipt! In your personal dashboard, you’ll be able to see not just profitability in real time, but also see the expense split for your business!
- Create a Solid Business Plan
Before you dive head-first into a new business, you need to have a plan. There’s a lot involved in running a business, and creating a solid business plan will give you direction. It will help you understand your company’s direction, objectives, and goals for the first 5 years. It will also help you make more risk-adverse decisions.
- Find Reliable Mentors
Running a new business on your own is very tricky, and it helps to have someone you can look up to and trust. Having a reliable mentor, especially someone familiar in startups, investment, and venture capital, can help you stay in the right direction and avoid risky moves.
Now that you know how to avoid initial risks for your startup, you have a greater chance of survival and success!