Jason Calacanis tell us how to save money
This post from Jason Calacanis should be standard reading for any newly funded company. I think it makes really interesting reading and contain gems which should be of use to any start-up.
My favourites were
3.Buy everyone lunch four days a week and establish a no-meetings policy. Going out for food or ordering in takes at least 20-60 minutes more than walking up to the buffet and eating. If you do meetings over lunch you also save that time. So, 30 minutes a day across say four days a week is two hours a week… which is 100 hours a year. You get the idea.
14. Allow folks to work off hours. Commuting sucks and is a waste of time for everyone. Let folks start at 6am or 11am and you’ll cut their commute in half (at least in LA).
I would add my own few from an Irish perspective
1. No company cars, we don’t own or operate a company car including my own, we don’t pay petrol expenses unless they are justified.
2. Headquarters you don’t need to be based in the hi-tech area and property is 50% cheaper in the burbs.
3. Get blogging it saves serious money on PR
4. Fly in the back only, I have never paid for a first class flight. Ever
5. Alternative solutions, our first employee Krisztina is leaving soon on maternity leave,normally we would have to get in a temp but she has agreed to work from home for 20 weeks saving us training time and a new employee costs.
6. One person responsible for booking flights, this is an art and should be only done by one person.
7. Conference calls to be kept to a minimum.
8. Events and conferences must be justified, try to get free invites, I have never paid for a conference ticket.
I would love to see what other tips are out there and am tagging a few of my friends in new innovative companies for their thoughts so get thinking, Dan Lane of Howlertech, James Whatley of SpinVox, Paul Sweeney of Voicesage, Paul Walsh of Segala (no travel advice though Paul 
), Robert Scoble of FastCompanyTV and Florian Seroussi of Celtrek.
26 comments...What do you think?
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Some super points here, and I agree with all of them. Just to add something to the conversation, I will add some I’ve learned in VoiceSage, and some from other start up’s i’ve been in:
- Not all your hardware has to be new, have a look at eBay, you’d be suprised;
- Like a good restaurant, all your money should end up on the plate, i.e. put the money into making the product great;
- Every meeting has to have a purpose, and I end every meeting by saying “was his worth $1,000. It can be a pain in the ass, but;
- No company credit cards;
- Build Social Capital with everyone in the company. There are months, and sometimes in a row, where people won’t get paid because other bills have to be paid. This social capital is cash flow to the company;
- Months later, go back and figure out how much you saved by making smaller mistakes earlier, and learning. This is actually quite powerful. Communicate this. People will then not be afraid to make small mistakes/misteps and report them asap.
- For flights: skyscanner
- Conferences are for customers, not ego. Figure out how much you made from a conference in actual sales and be ruthless about it. Where else would you drop $20k and go, oh well. If you are selling to enterprise customers you do sometimes have to pay for these things you know!
- A two hour lunch can be the best executive meeting you’ll have if you run it the right way.
- You are a start up, de facto everybody works flexi-time, early late, weekends. But let people do things during the day as well such as pick the kids up. It builds great social captial at home, takes stresss off of the employee.
- Bad customers close companies. Think extra hard about who you do business with as a young start up. I’ve seen good companies go under because a “bad customer” would not sign off on a project. A related point, is get paid in parts with customers. On sign up, on milestones, on sign off. You would be suprised how many companies skip this because “oh the project will be finished so fast, its a waste of time”. Ah huh.
- Don’t pay anyone to do YOUR killer business plan.
- Really, really talk to EI (enterprise ireland) and really really understand what they want from you, how they want it and when they want it. Get a mentor to help you through the process. You can get serious support in the marketplace if you know when and how to ask for it.
Hope those are of use to somebody.
Thanks Pat and Paul for your extra points. Lots to think about.
Instead of going thru all the ‘not to do’ things I would add the following:
- Pay for a CTO/CIO with experience. Methodology and processes are more important than design and XYZ whatever.
- Leave you door open if you have an office. You may be the boss but not ‘untouchable’.
- internal workshops are much more productive than 4 hours meetings.
- You must have a target and make this target clear for everyone. It’s a start up, people trust you, learn about sharing!
- Buy laptops with large screen monitors >22′ instead of desktops.
- Keep your distances. You can be co-workers, even friends but you need to be keep your decision making process intact. Most start uppers fail because they don’t know to say NO.
- Everyone should be able to have access to the office 24/7. No exception.
- Keep your investors up-to-date. They are not just here when you need them.
Florian SEROUSSI
Join an incubator program, free office space, free training, free money, free network. no down side.
Register with a VOIP supplier (We use glantel) cheap phone calls.
Get your first employees to bring their own computers to work and salvage old hardware. We did our first capital purchase 18 months after launching putplace.
Defer all payments.
I’m passionate about pretty much the same ways to save money. I posted the following addition on Techcrunch UK, that would also be valuable here:
Wow, that’s very myopic thinking saying that blogging can replace PR. That’s like saying a flyer on a telephone pole has the same effect as a 30 second Super Bowl commercial. Blogging is a TOOL of PR, not a replacement for it. I don’t disagree that not all businesses need to actively “do PR” but to make this kind of statement is really, really naive.
I drive an old-ish car (owned by myself), have an office based in Birr, use mainly 2nd hand IT hardware.
Am I deluded or on the awy to succes?
Move as much to open source as possible…Learn from Google.
I totally disagree with Joe Drumgoole!
NEVER NEVER DEFER PAYMENTS
You should stop before you enter yourself into debts. Defering payments is the worst advice you get give to young entrepreneurs.
Deferring payments is dumb.
You should build up credibility with suppliers, so when you need better credit terms / flexibility they will be more willing to help you out.
Too many Irish businesses seem to think that delaying payments is acceptable. It’s not. Get over yourselves.
Referring to Pat’s original post:
1 – Company cars are a total waste of money. A company van might not be.
2 – Agreed. Why do you think we’re in Carlow?
3.. Blogging can help, but shouldn’t be self-serving. If you haven’t got anything meaningful to say or know how to say it you’ll waste your time
4. I fly somewhere in the middle
Flying in the back might suit someone small and dainty, but being able to function after I land in LA is more important to me.
5 + 6 – don’t really apply to us, so I can’t comment
7 – I’m not sure what the point behind that was. Are you referring to time management or call costs?
8 – Getting freebies may not always be possible, but avoiding a lot of the overpriced Irish gigs is very easy to do
Here is one thing that I strongly disagree with. Conference, industry conferences have been an unequaled networking success. They represent the opportunity for face to face introductions so you can later make a warm call. They also represent an invaluable opportunity to establish yourself as an industry or Subject matter expert. Ask questions designed to spark engagement and debate challange speakers and panelists in a professional manner-you will be remembered and will eventually become an insider with unpressidented opportunities to be quoted in articles, call upon by analysts, and if done right you become an authority.
That’s exctly the outcome I’ve had and it’s been an incredible experience.