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In these cases, founders should never start paying themselves. As a startup entrepreneur, one must sacrifice for the financial health of their new business. I
by nuweborder 17y ago
In these cases, founders should never start paying themselves. As a startup entrepreneur, one must sacrifice for the financial health of their new business. If the company is in well enough financial health, then it is ok for founders to pay themselves a salary. But never if the company's revenues are not enough to cover their pay. When you go into working on a startup, you should understand that there are many times when it is in the best interests of the new company, to reinvest revenues into the company. In the long-term this will create a substantially greater payout for the founders later. The reward does not always come quickly. But with patience and hard work, when it does come, it will be much greater. Founders whom understand this, and are not looking to get paid too quickly, are the ones that are truly invested in the project for the long run, and want to see it through to being a success, as it is their creation and their baby. Not getting a payout in the beginning, for the purpose of improving the business for the later, will ultimately increase the founder's work ethic and dedication to the company. I am a creative thinker, and MBA, and have started a startup called www.bidrealm.net, and am working on another. For both of these sites, it was never in my mind to begin to receive a salary up front. I created bidrealm.net with no investors, and no debt, and have never taken a salary because I want the business to be 10% financially sound before that happens. The last thing that I want to do, is to take a salary, have my business not meet its goals, or even loose money or go out o business, and then after the fact I crunch the numbers and realize that if I had not taken a salary, that money would have either saved the company, or even continued to make it profitable and a success. What a terrible way to go out.