3 Worst Ways Entrepreneurs Spend Money During their Entrepreneurial Journey

The road to entrepreneurship offers plenty of opportunities to waste money. Surprising though, it’s quite true. Unless your rich uncle is bankrolling your entire start-up without concern for what and how you spend, you need to keep your expenditures under control. According to the leading startup consultants, the top five ways that entrepreneurs waste money, but shouldn't, are:

Franchise or MLM Fees

Don't bother with these business models, according to the leading startup consultants. Franchises, even the best ones, are too expensive for what you get, and MLMs are just a bad idea. The money you put out for either only provides you pieces of the operations side...you are still at square one as far as your overall startup. Your franchise and MLM fees buy only the operations ideas or access to brand products, you still must complete all your own planning, fund all equipment, location, staff, etc., and figure out how to get the product sold. You are far better off coming up with your own business idea, learning what you need to know, and actually working for yourself. And anyway, why share your profits with your franchisor or upline? You are doing the work, you should reap the rewards.

Note to remember: Franchise fees range from a few thousand dollars to tens of thousands, plus a cut of your profits through the life of the business. MLM buy-ins range from a few hundred to several thousand dollars.

Expenses on Grant Seekers

There are very few, if any, government direct grants for domestic start-ups. There are no secret grants, and there are no tricks to applying for grants if your business idea does happen to qualify for one. The government does earmark millions each year for small business, but the majority is distributed through various programs which are used to guarantee bank loans or provide short-term working capital to existing businesses. Some money ends up with local economic development NFPs who may provide training or micro loans to first-time entrepreneurs. If you qualify for any help through these programs, their staff will help you through the process for free. So, discuss with startup consultants before you invest or spend in grants.

Note to remember: Grant consultants charge a wide range of fees, but most are in the thousands.

Entity Registration Service

This is an absolute start-up squander, says famous small business consultants. If you have a straightforward situation, you can easily do it yourself. If you don't, you need an attorney. Paying for these services make no sense - if you understand enough to fill out their questionnaires about how you want your LLC or Corporation set up, you can just as easily set it up yourself. The government websites now provide a simple online form to fill out with clear explanations for each section. Even if you have your attorney review them, it will be cheaper than the average service. The hardest part is deciding whether an LLC or Corporation is the better choice for you...and nobody but you should be making that decision. If you have complicated issues involved in your organization or have specific concerns about partnerships or assets, or you are planning an IPO, work with a competent attorney in your state.

Last but not the Least

Spending your startup capital demands meticulous speculation. If you are not aware about doing things right, it will cost you in the long run. Work with expert startup consultants before you start spending your capital, because calculative risks generate profits in the most streamlined manner.