There is Always a Deal
When you’re building your company, every dollar counts. This is true both before and after your first financing.
Before your first financing, every dollar you spend directly impacts your chances of staying afloat for another month. You probably can’t afford to pay your developers, let alone for their catered lunches. Unsurprisingly, frugality only comes naturally for some founders.
After your first financing, you finally have the ability (and responsibility) to spend cash. It’s a great feeling. A huge weight, now lifted off your chest. You no longer have to check to see if you’ve over-drafted your bank account after buying this amazing panda stapler. You can spend money on personnel, office space, furniture, web hosting, computers, anything.
Regardless of where you spend that dollar, you need to remember that it’s probably coming straight out of your bottom line.
One thing that I’ve learned is that there’s always a deal to be made. Just like the GEICO commercials say, “15 minutes can save you 15%” on almost anything.
If you’re buying laptops for your employees, speak to someone at Apple Small Business — you might save yourself $100 on each one.
If you’re hosting on Amazon, speak to someone from the AWS Startup Program and get an account credit to the tune of $25,000 a year.
If you’re leasing an office and the price is $500 /month per desk — ask for $450. What’s the worst that can happen?
There’s no reason to not try and get a better deal.
It takes about 30 seconds to send an email that says:
“Hi $name, I saw that you’re offering $x for $3,000. Any chance you’d be willing to do $2,500? We’re a young company and it would really help us out.”
Despite how easy it can be to get a deal, a handful of fellow CEOs have told me that it’s not the best investment of their time to try and negotiate everything. I beg to differ.
Fred Wilson wrote a great post a few years back called ‘What a CEO Does’. He learned early in his career that he can evaluate a CEO by their ability to do three things, one of which is their ability to keep money in the bank.
You keep money in the bank by doing two things.
1) Earn more revenue.
2) Spend less money.
When the tides turn in today’s fundraising market, I think we will see patterns emerge between companies led by savvy spenders versus wasteful spenders. Only time will tell.
