Good Money Bad Money - MFF034

Marketing For Founders | Growth Hacking | Startups | Direct Response Marketing

In todays episode Tim and Jack discuss the differences between good money and bad money. Your host debates what type of startup money is safest, and what kind of cash can get you in a lot of trouble. Often when we start new businesses and ideas, it requires some sort of startup investment. It is easy to go directly to family or to sources of quick income to get your company lifted. However, we as smart entrepreneurs, must have a plan and action for the future, and a way to pay that investment back. Customers, research, and a sales funnel are some of the things you will need to get going.

Bad money is any type of cash flow that can be traced to a personal emotion. Ask yourself what life might be like, if your company fails and you lose your families money. Bad money is also taking investment without a plan of action, or any customer relations. Good money is not only about where it originates, but how you spend it. Good money comes in many forms such as, venture capitalists, savings from previous work, and revenue flow before you quit your day job. We define good money by security, consistency, and coming with a backup plan. It may not always be the “rocket fuel” you are looking for, to explode your business into the green, but it will keep your life intact, and your stress levels relatively low.

Types of Good Money:

• A loan from a bank spent on equipment and gear. This can be used as collateral in a bankruptcy.

• Venture Capitalist investment comes with a time frame, so meet it with a plan to ensure the money is back before the time is up.

• Earning money while your business grows is the “best money.” No need to quit your day job until the revenue is enough to sustain your normal life.

• Having a runway. A savings account with the cash you need for at least 1 year into your startup.

Types of Bad Money:

• Investment related to your personal life. There is no collateral, and your failure will affect relationships.

• Any money that forces you to make emotional decisions, unrelated to the success of the business.

Listen to this episode at: http://marketingforfounders.com/good-money-bad-money/