Wise Startup Blog

Working at our startup for the past 1.5 years has really put me on a negative cash-flow slide, what with barely being above the poverty line and all. And with our startup, if I can’t support myself, then my startup can’t stay afloat, so it was kinda important that I be creative.

Luckily, I’ve been able to pinch a couple of pennies and turn a nickel into 7.5 cents; here are a couple of ideas to get you going:

Sell used, new, refurbished electronics on eBay

Personally I like to sell Apple refurbished computers, primarily on eBay. I buy in bulk, and can sell at a lower price than what’s offered on Apple’s store, so I can turn a profit. The way to make money on eBay is to find either a niche or find the right bundle of items to make your product stand out. There are thousands of laptops on sale on eBay, but how many come with the latest wireless mouse or bluetooth headset?

This is coincidentally how Michael Dell got started, and a number of other entrepreneurs have admitted to getting started by selling on eBay. Personally, I want to move into smaller items than laptops, preferably cell phones or diamonds or something with a high net value but doesn’t require quite the physical space in my office.

Use your 0% credit cards to earn you free interest

Personally, all of my credit cards are maxed out, but if you’re one of the lucky ones that hasn’t had to dip into their credit reserves quite yet, you can make zero risk money by investing your credit card balances.

The trick is you need to have a 0% interest card on purchases. Say you have a $20,000 credit card with 0% until December. What you do is purchase an item, say 20 mac laptops, sell them on eBay, hopefully break-even, maybe even make a couple hundy on the deal.

Then, instead of taking that $20k and paying off your balance, take advantage of the 0% interest and invest that money. Take the $20k balance, throw it into a CD, money market account, whatever. Be sure to keep the money liquid enough to pay the minimum balance each month, but then at then in November, when your 0% period is over, pay off your balance.

If you’re earning 5% annually, you can make $1,000 with zero risk. But you’re in a startup, so you can always try turning that $20k into $40k by investing in more employees or buying even more laptops, cars, etc.

Use your expertise to provide consulting services

Are you a great designer? Can you SEO like nobody’s business? On your personal blog, which I’m sure you have, why not have a section to hire you as talent?

Just because you’re working on your startup, it doesn’t mean you shouldn’t try to bring in more cash flow. At Grooveshark, we have done a number of different odd jobs to keep things afloat:

• Designing web sites for parent’s companies
• Designing web sites for lawyers, PR firms, etc. to get out of paying the bill
• Trade out web design for advertising space to grow the business

When you’re starting off, it’s all about getting the most done with what you have. It that means trading in barter, and putting the project on hold for 2 weeks, then do it. You’ll find that the experience of working on a smaller project will be a good test for your team, and will help you be more cost-conscious with your spending in the future.

Buy used cars, refurb them and flip them for a profit

My business partner has a connect to a dealer’s license, and he’s been flipping cars for over 10 years. He goes on record saying he’s never lost money on a used car. Even if you buy the car today, and 6 months later sell it for the same price, you’ve been able to forego car payments for 6 months.

If you have a particular mechanical inclination, and the right space, you can make a hobby out of grabbing cars from grandmas who don’t know how to flush a radiator and double your money in no time. The ideal time to sell cars is around Jan-March, tax season, when everyone cashes in on their refund checks.

This is the kind of venture that bears some caution:

• You’ll have a lot of flaky buyers, so be prepared for the worst
• Don’t get stuck paying taxes, license fees, etc. so be careful, do your research
• You may open Pandora’s box once you get under the hood

Liquidate, liquidate, liquidate

You saw me mention eBay above, right? I hope you’ve got a big memory card for your camera…

What’s the best resource you have for generating cash right now? You’re probably typing on one or two of them. I’m not advocating selling your only work computer, but if you have any extra video cameras, DVDs, video games, Xbox systems, anything, it’s all worth cash, and if you’re in a pinch, it’s a lot better than putting your hand as collateral from a loan shark.

If you have a Mac, I’ve had a lot of success with GarageSale. It allows you to easily list all of your crap valuable possessions and get some sucker to buy it from you. One man’s trash …

Let me know if you have any good tips in the comments!