Yes, this is another call you will have to take when you start your dream company. Unfortunately or fortunately, every decision you make at this stage is crucial from the point of view of your finances. Its very important to know exactly how to Not get carried away when spending on technology. Here are a few tips which we think may help you:
Buy only what is required: If you run a design house, for example- only your designers would “need” a Mac. Make sure that you don’t atrocious amounts on the non designers by getting them Macs as well. Be strict when you are deciding what is absolutely required. If your business absolutely cannot function without that technology and you seem to have the money to spare for it- by all means, go ahead.
Phase it out: Instead of buying all your technology at once, it makes sense to phase it out. Buy what you think you need the most first. This helps you keep a tab on your expenses and arrange your expenditure on the basis of the status of your cash flow. If it seems like you will be able to afford the expensive software with next months receipts, hold it till then. Phasing it out will reduce the burden on your company and its finances. Also, it will prevent all your technology for going obsolete at once.
Don’t compare: You probably would have some friends who are also starting out companies of their own. Worse yet, you may have some enemies doing exactly what you are doing. And that guy might have just spent a bomb on some slinky new software which has received reviews in all the tech savvy rags. But is that reason enough for you to spend as much as well? Your cash flow may not be in as good a condition as you think or the software may not be as cool as you think. Just focus on your own requirements and spend accordingly.
Try outsourcing: If the main function of your company is not doing accounts, outsource it to those who do that for their living. Not only do you get the expertise you require, but you will not have to pay the cost of the softwares or the technology for your own organization. Outsourcing will greatly limit the burden which your cashflow feels when it comes to technology.
Try doing it yourself: If you want to manage your company’s website or online ad spends, there are many programs available online which will make it very easy for you to manage these yourself without getting into complicated (read: expensive softwares). If you can manage working out the expenses on a simpler software which doesn’t require to splurge then go ahead and use it.
Try to pick something which will not be obsolete tomorrow: The thing with technology is that if you blink, it becomes obsolete. The next version which comes out is cooler because it can do what the older version did infinitesimally faster. Try to go for a software which you know will not be completely obsolete for at least another couple of years. By then, hopefully you will be in a stronger place financially and buying these softwares wont physically hurt you.
Ask: There’s no shame in asking someone who understands your situation, about the wisdom of purchasing some new technology. As long as the person is not the salesman of the technology, he will probably give you an opinion which you will be able to accept without causing any great damage to your financial vitals.
Be honest with yourself and focus on the bigger picture, you will be able to draw the line.