One of the first steps to be planned in the starting out of a company is the value of the initial investment, as this will lead you to the next steps. Do you know this topic in detail? Keep reading and find out more!

What is the initial investment of a business

By definition, the initial investment involves all the costs necessary to start out a company and launch its operations. In general, this includes expenses with the acquisition of goods (computers and furniture) and implementation of processes (marketing and customer service).

And contrary to what many entrepreneurs think, the initial investment of an IT business does not have to be that big. As an example, we can mention Clemilson Correia who created his company with less than US$ 1k, in 2010.

After facing a financial crisis, Clemilson took out an overdraft of US$ 600 to create a platform for software licensing services for small businesses. Later, the investor began to provide consultancy to other entrepreneurs and his business reached an annual revenue of US$ 5 million. 

This is just one example of how investing in IT companies can work, though, it is necessary to think a lot about investment, planning and the business action. Now, let's talk about what are the initial investments required to create your own business.

Initial investments to open an IT company

There are several types of initial expenses to open a business, such as expenses with infrastructure, registration of the company and working capital. Let’s take a closer look at each one:

Infrastructure Expenses

Infrastructure spending is a priority when creating an IT company. In general, they cover the acquisition of goods, that is, the purchase of machinery, equipment, security, furniture, office utensils, among others.

Costs of Business Registration

You have to take into account the basic expenses for the registration of a company. The process may differ depending on the location, but it is very likely that the entrepreneur will have expenses to register the brand, obtain a business license, hire an accountant, etc.

Working capital

Before starting the IT company, you have to plan the capital needed to supply the cash flow demands. This resource is called working capital and involves internet, electricity and water bills, suppliers, taxes and wages.

Running a business with no surprises

The expenses mentioned above are the most basic ones for starting a business. So it is key for the entrepreneur to add up all these expenses and check the feasibility of opening the business, because when the initial investment is not well calculated, unexpected issues may occur. Do you need some help with this challenge?

Leave a comment with your opinion or doubt so we can talk about it!