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How Should Start-Up Businesses Approach Technology Investment?

The start-up phase of a business is a time when there is a lot of outgoing expenditure.  One thing that a business might choose not to spend money on, in order to save money, is technology, whether this is in the form of hardware or services.

tech

Image source verussolutions.biz

However, there are a number of reports available online that point to a lack of technology investment as being a key underlying factor when it comes to business failure.

Looking from the outside, it appears that you’re damned if you are, and damned if you don’t when it comes to technology investing.

How are you going to get around this?

Technology IS Essential

Without technology, your business is going nowhere; it is that simple. What it is wise to do, however, is to consider the services and platforms that you need to focus on most of all during your early days.

Things such as broadband, tablet devices, and mobile applications might be central to making your business model work. You might have things such as the use of helpdesk software, or advanced online programs, included to help you grow your business, but if funds are tight these may have to be deferred to a later date.

The first trick: understand the technology that is truly essential, what it is you need to operate, and then work with it.

Moving Forward

How you approach your future investments will depend on your business success. We would not recommend you invest in something as soon as you have cash at hand, especially if making a purchase will lead to consistent financial commitments over a period of 12 months or longer, for example.

Perhaps the best way is to include technology in your business plan. Review your needs at three months or six months down the line. Ask yourself whether you now need something, whether you can afford it, and question the value that it will add to your business.

While this sounds tricky, it will ensure that you are not over-committing yourself in terms of finances, and will keep your business operations efficient.

Getting a Good Deal

When it comes to making the most of a technology investment, so much of it centres on getting the best deal you can. This could mean taking advantage of free trials, buying a range of products or services altogether from one supplier to get a lower price, or having get-out clauses in contracts in the event that service level agreements aren’t met, for example.

It can feel like you’re being a little ruthless, but if you have to drive a hard bargain to get what you want, make your business better, and drive the bottom line, why wouldn’t you?

Don’t be Too Risk Averse

While most of our advice is centred around being conservative, being too risk averse is not going to do you any favours. Sometimes, you have to ‘take a punt,’ but if you do so then ensure it is a calculated risk rather than just a casual purchase of a technology platform you don’t really need.

Being smart with your technology investments could be the making of your business; ensure you take the chance.

Robert is an online content writer with a passion for technology, often analysing how managed VPS hosting, cloud services, and hardware can have an impact on the success of small and start-up businesses.

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