So now you have a product and you know how to market it. You're developing your customer base and the checks are beginning to roll in. It's very likely that you're starting to feel that you're home free.
Don't relax yet. There's still an important skill you must learn if you are to gain long-term success as an Internet businessperson.
Your business success is dependent upon your developing an entreprenuer's attitude toward money.
Here is the critical maxim every successful entreprenuer must learn:
Money is a tool, not a toy.
When you were an employee, you went to your place of work and did as you were told, and at the end of the pay period you received a paycheck. It was yours, so you went out and spent it.
You can't afford to carry the day laborer's attitude toward money over to your business. You must learn to use money to maintain and grow your business. That means learning the discipline to manage your money wisely.
When those first checks start rolling in, there's a temptation to run out and celebrate, to buy things that you have wanted but never been able to afford.
Don't.
This is your seed money. Like a farmer who will be ruined if he eats his seed grain over the long winter instead of keeping it to plant in the spring, you must put it back into your business. Take out only enough to meet current expenses (food, housing, utilities, etc.), and put the rest back into your business -- raw materials if you're producing your own product, advertising for any business, etc.
Make sure you set at least some of your income back for building up an emergency fund. This will be there to cover you if your business should (and probably will) experience a slow period. Once you've set back two or three months' expenses, concentrate on paying down and ultimately eliminating all your indebtedness. You want to keep your "nut" (the amount of money you have to spend on basic maintenence items each month) as small as possible.
Only as your business grows larger and larger can you start to afford use larger sums for your personal expenses. Always make the money you put back into your business and into savings your first priorities. Never treat this as something "left over" after personal consumption.
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This page last updated May 14, 1999
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