I was in Richmond, Virginia, talking to a friend who had just landed a job with Altria. She told me of Altria’s perks: one free carton of cigarettes a day, smoking in the office, and attractive coworkers. If that wasn’t enough to seduce me, she lamented, “And, I just have so much money, I don’t know what to do with it. I mean…I do a lot of online shopping…” I responded by shifting my weight from my right leg to my left (a reactionary tic—I must stop), and looked at the view of trash cans and junked dreams.
Cash Flow for Small Businesses
It’s not a common problem for a small business to have too much money; but your particular small business could be wasting its cash flow on internal affairs.
Set aside a small percentage of your cash flow every month to invest and partner in neighboring organizations, to build your brand. There are many low-cost micro-investments available to individuals and small businesses; take advantage of the changing, crowd-sourced economy, and extend your business into the community. Using the same model, you can also get crowd-sourced funding for a new project.
For investing your cash flow in other businesses:
- www.Kiva.org is a non-profit loan organization, that crowd sources for micro-loans, and establishes repayment rates, so your money will return to you in a mutually agreed timely manner.
- http://www.prosper.com/ is a great way to borrow and lend money, at fair interest rates; a 9.28% interest return on investments, and a 6.38% interest rate to borrow.
- http://www.microangels.org/ offers an environmentally conscious lens with the prospect of investing.
For securing funding for your own business:
- www.growvc.com is a crowd-sourced funding mechanism for start-ups and new projects within existing businesses.
- http://www.microventures.com/ is similar to growvc.com; allows users to crowd source for capital.
- www.lendingclub.com offers business owners with a credit score of 660 or above the opportunity to borrow in their network.
It is important to maintain an active mindset when approaching your business’ earned cash; actively invest and distribute your funds across different mediums, so your business’s security doesn’t ebb and flow alongside your vertical’s pathway. Invest in small amounts, so the losses and gains are muted, and once you get a feel for your community—start taking wider strides in investment. To supplement your new investing-savvy business, you can get free investment consulting.
How to Get Free Investment Consulting
Email neighboring business schools, and target MBA candidates. Offer your company’s data as a case model for their projects; they will deliver tailored analysis and consulting based on the data. Allow the MBA students to analyze your investment decisions, and internal practices; apply the solutions they offer as you see fit. Did we mention it’s free?
Free Cash Flow Personality
Finally, in order to utilize your free cash flow--consider personal interactions as business opportunities. Introduce your business model into conversations and existing relationships; allow friends and family to micro-invest in your new ideas, while maintaining an abject distance from “selling” your business.
Cash flow is just one of 108 accounting terms that every small business owner needs to know. Download our ABCs to learn about all of them!