For a scaling company, finding the next advisor, consultant or interim CFO is a challenge – that’s a fact. Every year, thousands of companies look for the right financial and advisory expertise, but it remains a needlessly complicated process that creates a lot of frustration for businesses. While many other industries have experienced digital transformations over recent years, advisory services have not. ReachX was built to solve this.
Founded in 2018 by former employees and alumni of leading institutions, ReachX is a tech platform that has helped companies source leading financial advisors and scale-up advisors to create an easier, more transparent approach to finding the right resources and funding for scaling businesses. The company has over 3,000 of the best advisors and unique tech tools to facilitate fundraising, investor connectivity and deal and project execution. The result? A simpler, more accessible, and cost-effective way to support growth companies from seed to IPO.
Rafael S. Lajeunesse is the company’s CEO and responsible for driving its vision. Prior to ReachX, Rafael worked with JPMorgan & Co. in London where he was a Portfolio Manager. He was also a consultant with McKinsey & Co. in New York working with clients across media and financial services. He earned an MSc. from the EMLyon Business school and received his MBA from The Wharton School.
In this article, he offers advice on some smart ways to cut your business expenses when seeking investment for growth.
For businesses that are starting out or scaling up, seeking investment opportunities can often feel like an uphill struggle. With an abundance of options out there, it’s tough to know which direction best suits your business model and goals.
Navigating the ins and outs of raising capital will always present challenges, however, it’s also crucial to keep your company’s costs down when seeking investment opportunities, to ensure you and your business are focused on the right areas that will inevitably attract the right investor.
Here are some smart ways to cut your business expenses when seeking investment for growth.
Evaluate and streamline your overhead costs
Assess all your company’s overhead costs and identify areas where expenses can be reduced, this could mean working closely with your operations manager or team responsible for external suppliers and vendors to see what your options are. You may need to streamline certain operations, contact your existing vendors and suppliers and renegotiate on price or alternatively seek more cost-effective suppliers that meet your financial quotas.
Embrace tech
This step is imperative, your company should already be employing the latest tech tools to improve efficiency, but also tech solutions that can automate processes will, of course, reduce manual labour costs, saving the company money. Implement cloud-based tools, project management software, and communication platforms where possible to streamline operational processes and customer/client engagement.
Reallocate existing resource
Understanding the function of each of your business areas is key, that way, when it comes to evaluating resources, you will have a clear idea of which area requires more money and of course, which area you can pull money from.
For instance, you may wish to pull finance from your admin support function or customer service area and switch to cloudbased tools instead. Then you can reallocate that resource to your finance and accounting department – ensuring you are able to provide accurate and transparent financial statements, income statements, balance sheets, and cash flow statements to highlight the company’s financial viability and potential returns, which a potential investor will most certainly be interested in.
Establish a cost-conscious culture
Practical solutions are crucial but so is mindset. Foster a cost-conscious mindset among your employees by promoting cost-saving ideas and rewarding innovative cost-cutting measures.
You can also encourage employees to identify and implement efficiency improvements that will help cut costs and in turn, allow everyone to have influence on the overall business expenditures.
Outsource non-core business functions
Consider outsourcing non-core functions or tasks that can be managed more cost-effectively by external experts such as services like IT support, or marketing. This can reduce fixed costs and provide flexibility.
Consider shared spaces and collaborations
With so many options available, it might be worth considering exploring shared office spaces or co-working arrangements, which will, of course, reduce the rental costs of office spaces. The increase in the number of staff remote working also translates to less overhead costs for the company, so consider this as an option. Another strategy to reduce expenses is through partnerships with complementary businesses, this means sharing resources and expenses related to marketing, events, or equipment.
Monitor and control company travel expenses
Your company may work on an international business model, meaning lots of traveling to and from meetings in different cities. Try implementing travel guidelines to control this, encouraging the use of video conferencing and virtual meetings as alternatives where possible.
Continuously review and adjust
Putting these cost-cutting measures into place will certainly improve your business turnover, making the company more appealing to investors, as well as freeing up resources to find the right investor. However, this business exercise should be conducted regularly to truly see if your strategies and changes have worked. You can adjust strategies as needed to ensure ongoing expense reduction while maintaining operational efficiency and just keep tabs on how the overall company performs following those changes.
While it can seem like a huge amount of work to cut the business costs when you’re seeking company investment – these steps will not only allow you to refocus resources and energy into finding and attracting the right investor, but they will also enable you to finely tune your business model and operational costs, resulting in an overall improvement in efficiency, which in the long-term can only be beneficial.
Find out more about ReachX at www.reachx.co
