5 STRATEGIES TO EXTEND YOUR STARTUP RUNWAY + MINIMIZE BURN
A LONGER RUNWAY could mean more time to test strategies and solutions, make mistakes and iterate your way to growth. Extending your runway give you more time to find product market fit and grow revenues.
AT THE PRE-SEED and SEED STAGE aim for no less than 18-24 months of runway. Keep in mind that the total amount of capital that you need varies widely by industry, resources, and economic conditions.
TECH STARTUPS ARE likely to burn through funds faster than a non-tech startup. If you run the numbers and don't have enough runway to make it to your next milestones, or you’re trying to rebound after a few tough months, apply the strategies below sooner than later.
GROW REVENUES AS A PRIMARY STRATEGY VS SIMPLY REDUCING COSTS.
- Sell brand experiences
- Upsell to current customers
- Collab with adjacent markets or brands
- Max ROI with sponsorships or partnerships
- Presell + use revenues to create (as long as you can deliver the product)
BOOTSTRAP MARKETING
- Diversify + A/B test strategies for 3–4-months
- Build relationships within + outside of your network + be clear about your asks
- Free + paid social media
- 1-on-1 social outreach + cold calls. Not sexy but works
- Less spend doesn't always = best ROI
CUT NON-ESSENTIAL SPEND
- Living alone? Consider roommates or moving in with friends, even if it’s less sexy|
- Paying office rent + can break the lease? Consider working from home or a co-working spot
- Review COGS and financials for nonessential spending + cut where you can
REVIEW FOUNDER COMPENSATION
- Pay yourself less to make more capital available for growing the business
- However, make sure that you’re paying yourself enough to cover your survival number because at the pre-seed or seed-stage there is no company without you
DIVERSIFY FUNDING
- More revenue is #1 funding source
- Seek non-dilutive grants or low-interest loans
- Sell equity to accelerators, Angel investors, VCs, or equity crowdfunding
- Consider crowdfunding or pre-selling if you can deliver the product
- Always be fundraising