“Time is Money”, Nobody connects to this phrase better than a person who is a founder of a start-up. Start-ups are born out of ideas either related to innovations or market needs. And when things start rolling out for the founders, the idea starts taking shape of an organisation. Such “organisations” here are necessary evils. You got to have an organisational entity to grow and organise your business, however you also need to service it with regular mundane and time killing jobs like accounting, financial management et al. Moreover, often the skills required to start a business is there amongst founders, but skills required to manage finances, accounting, payrolls etc are absent. So, the founders generally take two of the following approaches:
Build an in-house finance team:
Building an in-house finance team gives you control but drains your valuable time and money. Acquiring right talent for finance team again is tricky and expensive affair. Ultimately the core team may end up with compromises on focus on their core competencies, i.e. the core purpose for the existence of their business model.
Look for someone to help:
In short, Outsource it. This is again a complicated stuff. And typically companies adopt a “chalta hai” attitude towards it. Outsourcing finances and accounting has to be very professional. Ultimately, like for every business, you will need to come back to it to decide on both long term and short term strategies. We must keep in mind that operational outsourcing of finance and accounting management is just the tip of the ice berg, the crux lies in generating intelligence out of it.
Following are the pointers we can keep in mind while hunting for an outsourcing agent (I would now rather like to call it a partnership)
- Skills: Operational, technical and Business intelligence
- Speed: Remember, time is money
- Money: Not just the gross amount but the value and RoI of each penny you spend
- Minimal transactions: Time and complexity saved in outsourcing should not be eaten up by time given in liaisoning
- Regulatory and Compliance: One cant just afford to have an casual approach towards it
- Scope of work: Decide on what all to outsource
- One stop solution: Its always easier to communicate and liaison
- Expert Advisory: We should always keep a provision for it in back of our mind. Such change agents should be in our speed dial list.
Having said the above, the founders must evaluate the outcomes in terms of time, money and efforts. Keeping the strategies in place, in an ecosystem everyone must focus on their core competencies the max.
First thing first, let’s try to figure out basic answers
- What is your core competency?
- Are you doing justice to it?
- Are you losing on opportunity?