06/30/2014 12:11 pm ET Updated Dec 06, 2017

What to Do When You Start Making Money in a Startup


Once your company starts making a profit, it's time to redefine your goals and set a direction for accelerating your next stage of growth or establishing yourself more firmly in your niche.

Making money is one of the most important, and sometimes one of the only reasons entrepreneurs start their own enterprise, so once your startup starts making a profit, you might not know what to do with yourself. Depending on what industry you're in, you might have spent months or years investing money in your idea, taking losses to establish your presence and grow your sales.

When you reach that all important turning point and you start to make a reliable profit, you have several options. A consistent, profitable stream of revenue is a sign that your business is stable enough to make your next move. That next move is completely up to you, and it will ultimately shape the destiny of your business for the next several years.

Option 1: Invest in your capabilities.

Take some of your extra money and start improving upon your current system. Hire more people if you need the help, or improve your products and services to appeal to more people. This won't increase your revenue immediately but it will greatly strengthen your company's relationships with its customers and employees.

Option 2: Invest in your reach.

Expand geographically or demographically. Start marketing to new audiences with your extra cash and try to build new lines of revenue. As long as your market research supports the expansion, this is a great way to quickly build your revenue stream.

Option 3: Settle in for a while.

There's nothing wrong with keeping your company consistent as long as it's profitable. Take some time to iron out inefficiencies in your current system and reap the rewards of your favorable balance of revenue and expenses.

Option 4: Complement your company.

You could also allow your company to become self-sustaining and funnel your new profits into a complementary endeavor. That could mean a new brand within your company's overarching brand, or a completely new enterprise that offers a complementary product or service.

These aren't the only options you have, but they're some of the most important to consider. No matter what you choose, stay true to your original model and stay loyal to your customers.

Jose Vasquez is a serial entrepreneur and tech enthusiast dedicated to helping startup technology companies get the direction and momentum they need to succeed. As the founder of Build. Brand. Blast., Jose has established a collective resource for tech entrepreneurs to consult when brainstorming, creating, launching, or expanding a new business. Jose is also the founder and CEO of Quez Media Marketing, a marketing firm that combines technology and creativity to help new and growing companies get the results they need.

Jose graduated from Goldman Sachs' 10,000 Small Businesses program. Goldman Sachs is a partner of the What Is Working: Small Businesses section.

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