When is the right time to pay myself a salary?

The issue of whether a startup founder should pay themselves a salary is not straight forward. Many entrepreneurs tend to simplify the issue and pick one of two extremes. They either: Get no pay. Get paid close to fair market value. They raise enough external funding to reduce the risk and afford to pay themselves. Clearly it’s more complicated than that and here are a few thoughts: Investors vs. No Investors If you’ve raised money from angels or VCs, chances are that your salary will be governed to some degree by your agreement with them. They will not want you to arbitrarily raise your salaries and extract inappropriate levels of cash from the company. Co-Founders vs. No Co-Founders If you’re the only founder in the company (and there are no investors), then chances are you can make the salary decision. This can be based on things like available cash, tax optimisation (within the law) and fair market value. Most bootstrap startup founders tend to minimise the salary...
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6 things to know before you look for funding

Cash is the lifeblood of any business, and at some point, every company is likely to need funding to help it grow. Whether you're seeking £1million in venture capital or £1,000 from friends or relatives, you'll need to nail down a few basics before trying to make your case. Here are six things to you must do before approaching investors for any amount of money. PRESENT A BUSINESS, NOT AN IDEA Investors hear ideas on a daily basis. While many sound great, they may not be viable. Even a business plan is not enough to attract an investor. You must be a business with a model that scales and a product or service that has “legs”. Even then, you still should prove you know what you are doing. MANAGEMENT TEAM Ensure you have a strong team in place that can help and support the growth of the organisation. The big question for nearly every financial backer is: Can you do this? They’ll want to know that...
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