Will blogger or webmaster face undercaplitalization throughout their business?

by whlooi | Filed under BSL5.com, General, Interesting, KeyEll(Kuala Lumpur), Networking.

Undercapitalization, or lack of sufficient operating capital, simply means the money has run out. I know this crisis very seldom happen in our blogosphere, as nowadays, the capital that we need to launch a site of your own is just getting cheaper and cheaper every year especially for new registration of domain name. However we do need to know how to manage fund, especially when we are talking about creating a blogosphere/networks for media advertising, exclusive ebook reseller, information exchange center (forum, service, support) of your own to earn an living then you really need to sit down and take a look at what you have and what will you have in order to run your business in long haul.

The whole concept is simple, but the root causes of undercapitalization are more complex. Knowing the factors that lead to it can help you prevent them.

Here are some tips on avoiding undercapitalization of your business/investments.

1. Well you have to choose an industry you know. Do not rush into a business in which you have little or no experience. Lack of experience can lead to underestimating how much capital it takes to keep the business afloat, which can spell disaster for your new venture. For example: do you know how much that you will need to invest fir a semi-VPN server, or may be a full dedicated server? What are the extra charges to maintain those servers?

2. Have a thorough plan. Your plan will inform potential readers, advertisers, affiliates and partners about your business and (hopefully) entice them to invest. But it should also serve as a roadmap for starting and running your blogosphere. If your plan is thorough, you will know if your business is viable and whether you can afford to fund it during the startup stage and beyond. Set realistic goals, taking into account worst-case scenarios and planning for these eventualities. See the some of the blogger’s fact here to prepare yourself.

3. Get an accountability partner (* if you think you need one). Many website or blog owners go into blogosphere for themselves so that they can be their own bosses. What many fail to realize is that even CEOs of major public companies are accountable to a board of directors. Generally, business owners who have a mentor, accountability partner, or business coach consistently outperform the competition such as Gala Darling (example) who has been mentioned by Darren (problogger.net) on Gala’s Lessons in Blogging. The post did give her blog fame. [Getting another perspective is always valuable, and it may spare you from making costly miscalculations.]

4. Differentiate your blog/business. This is what most of the internet market gurus will tell you to do based on the fact that readers today are overwhelmed with choices; how will your construct your product such as eBook or service stands out? You may be able to remain meagerly profitable in a saturated market, but unless you give buyers a compelling reason to choose you over someone else eBook, if not you will not thrive. You may have to close up shop if your revenue cannot meet all of your financial obligations and retain a reasonable ROI.

5. Provide stellar instant response service. It is just another way for you to differentiate from the competition. When it comes to reader retention, site owners should always look for ways to improve their knowledge and skills, as well as those of their partners. Readers come to you for information, if they found it, they are happy, happy readers are “clicking” readers, which keeps the cash flow positive through advertising and traffic, simple as that.

So what else I missed……..Hmm……