Frugality started as a habit in my life, later shifted to a key factor in building an efficient Software development company with remarkable success.
Just like any fellow entrepreneur, I began my journey from point zero. I still remember getting my first customers through networks alone. At that point, I had at least two thousand thoughts flashing through my mind before spending each penny.
Still, Why frugality, if you might ask? Let me explain the four benefits of going frugal in an entrepreneurial journey.
The life of an entrepreneur will be trial & error, experimentation & calculated risks over many years. Having a frugal attitude contributes to entrepreneurship’s advantage in this regard. Frugal entrepreneurship can ensure a significant amount of business and social value without draining your financial resources all at once.
Let me walk you through the advantages of entrepreneurial frugality.
1. The Frugal Mindset
Everything begins with the mindset. I started NeoITO in a rented space from my father. It wasn’t a point where I could spend money on polishing the furniture or investing in the infrastructure. I focused on acquiring more clients and cash flow.
Eventually, I could provide job opportunities for more people and move into a much bigger space.
2. Sharper instinct
You might have heard that “Sometimes, you’ve gotta live a little,” they tell me. “What’s the harm in blowing some cash?”
Success comes at a price, regardless of how successful you become. Frugality can sharpen your instinct when it comes to spending money. It gives a sense to your actions on when and where to spend. The problem is that overspending is like underexercising.
3. Training yourself for emergencies
Growing a company is not everyone’s cup of tea. It begins and continues with multiple risk factors. Building a talented employee pool, balancing finances, etc are crucial elements of a successful business. Frugality implies a healthy sense of caution. It helps in arming yourself in the face of adversity.
We cannot expect life to continue in its current form forever. A natural disaster, a severe illness, a market downturn, and myriad other events can cause and result in substantial financial setbacks.
Going frugal will make you braced for emergencies and financially healthy for the future.
4. Tracking expenses
Money management is often closely associated with wealth and financial success. More than that, the distinction between needs and wants should be emphasized. It is also essential to have strong economic principles. For example, I set specific benchmarks when it comes to spending habits.
Say I want a fitness band worth 25k; I will challenge myself to reach specific benchmarks before getting my hand on that fit band and training my mind to earn it before spending it.
Now you know why frugality is an inevitable necessity for any business.
To improve your life substantially, you must understand what it takes to be a true success in business and personal life. Ultimately, achieving your goals requires patience and continued improvement. When I founded NeoITO, it wasn’t a bed of roses.
There were instances when I was about to be financially tanked. Frugality, among many other factors, helped me to move forward with my dream.
The best insurance against a financial crisis is to be prepared any time of day. Try it yourself and adopt the best practices that can help you grow financially, and no matter what goes wrong, never stop trusting yourself and your skill.
The journey ahead as a frugal entrepreneur is hard and shaping such a mindset requires focus, time, and patience.