Start-up: How to reduce cost?
Definition
The term startup refers to a company in the first stages of operations. Startups are founded by one or more entrepreneurs who want to develop a product or service for which they believe there is demand. (source: investopedia)
Challenge
All companies want to reduce as much cost as possible, and a start-up even more so since its cashflow is much more limited than already working company. At this point, all you have is a solution, your in-progress product, few employees or maybe none, and trying to hit sales KPI to generate targeted revenue. Your fund is set and you’re struggling to go through.
Solution
What I have done for RESS JSC is applicable for most other businesses, especially tech-based ones. Here are the key points from a developer’s point-of-view:
Start small, and get your MVP (Most Viable Product) out ASAP
Develop your product is the pain-in-the-ass. There are lot of mistakes can be made, such as: your product doesn’t meet market needs, feedbacks lead you astray, too costly, etc. The faster you finish your MVP, the faster you can rollout your goods to gain users/customers, execute following plan, and perfecting your product.
However, it’s wise to start testing your idea first as a non-profit side-project. There is no guarantee your product will be a hit, and if you have no income, it will be a big trouble. For dangtintudong.net, I & co-founder created it back in Jan 2021 but only started commercialization in April 2022. It has started as a prototype pet project until proof-of-concept is proven.
Choose the right technology
It helps a lot, please note these points:
- Popular technology has bigger community. Your problem may be already solved by another developer or you can ask community for help. StackOverflow is one of the best place to seek for answer.
- Utilize Open-source project. Why should you build something from scratch if there is someone already build a skeleton framework to almost fit your need? Just remember to thank them by giving him stars or rating. I often choose free theme built on a solid framework to make my projects easier to start with.
- Go paperless. it’s web 4.0. Most of your daily operation can be perform online. Google Docs, Canva, e-Wallet, etc. are things you should integrate into your business.
Take advantage of freebies
A lot of tools out there is free-to-use, some others have trial, coupon for you to try their product as well. There is no harm in utilizing them to benefit yourself when you’re small. For instance, cloud service are giants in modern world, and they offer varieties of free stuff: AWS free-tier for 12 months, Alibaba Credit, Microsoft Azure 200$ Credit, etc. Here are what I choose for RESS:
Hosting: Amazon Web Service (AWS), Vultr 50$ Credit
Email service: Mailjet for transactional email you may need for user registration, password recovery, etc.
Software: Ubuntu OS, nGINX webserver, PostgreSQL, etc
Dev’s ecology: Atlassian
- Bitbucket: git repository, it offers private repository as oppose to GitHub
- Trello: card-based team workspace to manage workload
- Confluence: documentation
Debugging: Sentry for catching server issue without SSH into them to get the logs
Monitoring: Uptimerobot for checking if my site is down due to EC2 instance overload or any shitstorm
Content Delivery Network (CDN): Cloudflare is a global network designed to make everything you connect to the Internet secure, private, fast, and reliable.
Track expense
If there is inevitable expense, you need to track them and make plan to keep it in place. For example, you can set AWS cost limit or budget monthly.
Invest in technology
Even though new may not be as good as old, in technology, it often brings more added value to your company.
Ocasionally updating your tech stack will bring you benefits in the long run, or else you may find one day your product is obsolete or vulnerable to hostile attack.
- Less technical debt
- Better security, performance
Buy refurbished equipment
You need a laptop? Better buy those used but in good condition & in warantee. The cost will be 20~40% less. The only issue you may have is VAT invoice for tax declaration.
Hire freelancer when possible
Outsourcing will help you to think less of managing staffs and put your time on other productive activities.