Starting a business without a client or project is a true test of determination, patience, prudence, and pragmatism. We often see small companies where freelancers or entrepreneurs with 1,5 employees end up earning less than a corporate manager’s salary, despite taking on more risks and a very different workload.

Ioana Arsenie, financial strategist and entrepreneur in consultancy, has prepared useful advice for people who want to start their own business or are already in the early stages of a startup.

1. The Initial Budget Allocated to the Business
A startup requires resources, even if fixed costs are not high. Therefore, the first piece of advice is to draft a rough budget both at the business and personal level to determine how much time we’re willing to allocate for this test period, ensuring the business’s continuity and increasing our chances of success.
Even though early on we may allow ourselves some exceptions to the rule, it’s best to build the habit of separating personal and business finances as early as possible. While emotionally attached to our own idea, it’s wise to switch to the investor role when running a startup and seriously analyze performance versus investment, as well as waiting time versus risk.

2. A Coherent Financial Strategy for the Business
Another useful tip is to think in terms of financial normality when it comes to strategy, costs, and pricing. In many cases even in businesses growing toward one million euros in turnover or in larger ones preparing for investors or M&A we see that founders fail to budget a fair salary for company management, especially in scenarios where they may eventually step back from operations.

3. Type of Tax Representation and Signed Contracts
Taxation is on the rise, and there are many changes from year to year. Ideally, we should not choose our business form (PFA/SRL) based solely on the lowest tax rate. There are many differences that deserve more attention, documentation, and consultation to fully understand the pros and cons.
Additionally, special attention must be paid to the contracts signed at the beginning of the journey, to how partnerships are regulated, and to clauses that might trigger personal financial liability.

About Ioana Arsenie
Ioana Arsenie is an expert with over 20 years in top roles, board member, and author of numerous studies, analyses, and expert opinions primarily dedicated to SMEs. Since 2015, she has been serving this sector through her own consultancy firm, Trusted Advisor Strategy & Finance.