Expenses & Costs
Lesson
Expenses can pop-up, supplies can suddenly be hard to find, or delivering the most value to customers can involve some expensive choices. Startups can run out of money — it happens. But it doesn’t have to happen if you actually know how to spend money wisely, watch this video to learn how.
How to Spend Money Wisely: Crash Course Entrepreneurship
Project Description
This activity allows you to learn about expenses and costs in making a startup by analyzing a real-world example in the form of a business plan.
Instructions
- Read this article about StartUp Financial Planning focusing on the expense tables.
- Find a Business Plan: Search online for a sample business plan for a startup. Look for one that includes detailed information about expenses and costs.
- Read the Business Plan: Read through the business plan, paying close attention to the section that outlines the startup’s expenses and costs. Take notes on the types of expenses listed and how they are projected to impact the startup’s budget.
- Identify Key Expenses: Identify the key expenses and costs mentioned in the business plan. This could include initial setup costs, operating expenses, marketing expenses, and any other relevant costs.
- Calculate Total Startup Costs: Use the information provided in the business plan to calculate the total cost of starting the startup. Add up all the expenses listed to get an estimate of the total startup costs.
- Analyze Monthly Expenses: Look for information on the startup’s monthly expenses. Identify recurring costs such as rent, utilities, salaries, and other ongoing expenses.
- Reflect on Learnings: Reflect on the expenses and costs outlined in the business plan. Consider how the startup plans to manage and cover these costs. Think about what you can learn from this business plan in terms of managing expenses for your own startup.