By Brett Farmiloe

Cash flow is key to running a successful business. We’ve gathered the perspectives of business leaders on how to save money and extend a startup’s runway. Whether it’s regularly assessing and optimizing your operations or repurposing your marketing content, explore 13 cost-saving strategies that work.

How to save money in your startup

1. Invest in cost-saving technology

“Our coworking space was running on high operational costs. This was affecting our prices significantly and our ability to compete. Our financial audits revealed that implementing new technologies could significantly reduce these expenses, so we invested in energy-efficient lighting and advanced HVAC systems, along with installing solar panels. Significantly reducing our operational costs has enabled us to offer more competitive rates and has led to increased customer retention. Our eco-friendly practices and lower carbon emissions approach has also given us a competitive edge in the market.”

—Pratik Potnis, TRIOS Coworking

2. Don’t get distracted by “shiny objects” like AI

“Say no to expensive AI integrations. This year alone, we were approached by at least 20 teams offering AI solutions. Most proposed simply integrating the GPT-4 API into our processes without understanding too much context, quoting fees between $10,000 and $50,000.

“Instead, we decided to test our AI capabilities in-house. For example, we used basic Python, scikit-learn, and pandas to analyze our data and identify trends. We successfully predicted the rise of certain restaurant categories, leading to targeted content creation that significantly boosted our traffic. We spent roughly 5% of the quoted prices.

“Think differently about AI. If you believe in its potential for growth, start small with an MVP (minimum viable product). Scale gradually as you see tangible results. Don’t buy a shiny object. Only you understand your business and know how to implement it in your domain.”

—Elijah Puzhakov, Restaurantji

3. Regularly assess and optimize your operations

“Cut down on unnecessary expenses by regularly assessing and optimizing your operations. Review and audit your subscriptions and membership fees, especially if they are automatically renewed, so you don’t risk getting charged continuously for apps or services you no longer use.

“Consider investing in AI-powered or machine-learning tools that can help augment your manpower in order to cut down on employee payroll or additional talent acquisition costs. Switch to cheaper tools or services if an alternative can get the job done just as well.”

—Baidhurya Mani, SellCoursesOnline

4. Utilize open-source software

“In our early days, we leveraged open-source software wherever possible to save money and extend our runway. Taking advantage of free-to-use tools for development, frameworks, communications, and project management was an easy way to avoid costly subscription fees, which would have added to our operating expenses and depleted our margins.

“I encourage startup leaders to consider the open-source solutions available to them as a way to limit expenses in the early stages. As the business grows and becomes more profitable, its requirements will likely change. More advanced software, or possibly custom-built solutions, may be the best lever to accelerate scaling. It’s prudent for leaders to factor these future expenses into their road map so as not to stifle progress when more comprehensive tech is required.”

—Balázs Keszthelyi, TechnoLynx

5. Be cautious with your hiring

“If there’s one piece of advice I’d share with aspiring business owners, it’s this: be cautious with your hiring. Rapid hiring can feel like the fastest path to growth, especially after securing funding, but it’s often the quickest route to burning through your runway.

“We learned to focus on keeping our team lean and flexible, prioritizing product development and customer feedback over expanding our team size. This approach not only saved us money but also kept us agile, allowing us to adapt quickly and effectively to our users’ needs. Remember, every new hire should fill an essential role that directly contributes to your startup’s growth, not just expand your head count.”

—John Xie, Taskade

6. Regularly review your expenses

“One thing a startup can do right now to save money and extend their runway is to prioritize essential expenses and cut back on non-essential ones. We implemented a strict budgeting system where we regularly review our expenses and identify areas where we can reduce costs without compromising the quality of our work.

“By being mindful of our spending and making smart financial decisions, we’ve been able to stretch our runway and weather any unexpected challenges that come our way. Remember, every penny saved today is an investment in your startup’s future success!”

—Alex Stasiak, Startup House

7. Shift to remote work

“I recommend cutting operational costs by embracing remote work. In the digital age, our startup implemented a strong remote-work policy, which reduced costs associated with office space, utilities, and equipment. This shift not only reduced costs, but also increased team productivity.

“Using collaborative tools has ensured seamless communication and efficiency while maintaining security solutions for our clients. Accepting remote work allowed us to increase our financial runway by redirecting funds toward innovative technology and customizing security solutions.”

—Eugene Klimaszewski, Mammoth Security

8. Invest in skilled team members

“This might sound like an antithesis to saving money, but investing in your team is critical to maximizing income and expediting revenue generation, especially for newer businesses.

“Many companies tend to tighten their pockets regarding people resources, opting for cheap labor instead of paying more for skilled, experienced individuals. A budding enterprise needs solid handling in order to prosper, and shelling out money on the right people and resources is more financially sound for long-term business success.”

—Jamie Frew, Carepatron

9. Adopt a “budget of zero” mindset

“At our startup, I’ve really tried to operate from the mindset of a ‘budget of zero.’ Anytime we are using a tool or about to make a decision, I always ask myself—can this be done in a similar way for less? In asking these questions, I’ve found that we have eliminated bloat, stayed lean, and actually increased our R&D as we search out more efficient and effective ways to do things.”

—Matthew Sanjari, PRIME Consulting

10. Save money with a DIY approach

“Our startup is fully bootstrapped, and I’m a big believer in self-funding and being scrappy. Spending your own money encourages you to be more mindful of it and think of it as a finite resource rather than falling back on the assumption that you can always raise more.

“We’ve used many tactics to reduce our spend and extend our runway. For example, we downsized from a more expensive email provider to a no-frills, cloud-based send service that meets our needs but costs us dollars per month. We have also bartered services with other professionals, swapping our areas of expertise.

“It’s surprising the amount of things you can do by yourself as an entrepreneur, and I always advocate at least trying the DIY approach—if it works, you save major money, and if it doesn’t work, you always have the option of seeking out a third-party solution.”

—Michael Alexis, Virtual Team Building

11. Focus on core competencies and outsource non-core functions

“I’ve witnessed firsthand the power of focusing on core competencies and outsourcing non-core functions to extend a startup’s financial runway. This approach not only saves money, but also allows the business to concentrate its resources on areas where it can truly excel and differentiate itself in the market.

“By outsourcing specialized tasks such as technical SEO audits or advanced analytics setups, we were able to access top-tier expertise at a fraction of the cost of hiring full-time specialists. This strategic outsourcing enabled us to focus our internal resources on building our brand and crafting compelling value propositions, while still benefiting from expert insights and skills in other areas.

“Moreover, adopting a lean approach to product development and marketing efforts has been instrumental in stretching limited funds further. By employing a build-measure-learn loop, we were able to quickly iterate on product features and marketing messages based on real-world feedback, without overcommitting resources to unproven ideas. This not only reduced waste, but also accelerated the pace of innovation, allowing us to more effectively meet customer needs and stay ahead of competitors.

“This combination of strategic outsourcing and lean methodologies can significantly extend a startup’s financial runway, enabling it to invest in what truly matters: building a sustainable, differentiated business that resonates with customers. By being strategic about where and how to allocate resources, startups can navigate the often turbulent early stages of business development with greater financial security and strategic focus.”

—Haiko de Poel, Mass Impact

12. Establish a solid legal foundation

“A key strategy for startups looking to save money and extend their runway is to have a solid legal foundation from the beginning. Ensuring that all your company’s contracts are in writing—including engagement letters, vendor agreements, and service agreements—can save substantial legal costs and prevent potential disputes. For instance, Implementing non-disclosure agreements (NDAs) when speaking to prospective vendors, employees, and business partners safeguards your proprietary information, which is critical for maintaining your competitive edge and avoiding costly legal battles.

“Another area where startups can optimize their resources is by protecting their intellectual property strategically. By securing trademarks and patents early on, you not only protect your brand and innovations, but also increase your company’s valuation, making it more attractive to investors. Conducting an extensive trademark search and filing for a trademark with the USPTO, for example, ensures that the business name and logo are protected, avoiding the rebranding costs and disputes that can arise from trademark infringement.

“Lastly, startups should leverage technology to streamline operations and reduce overhead. We have adopted cloud-based solutions for data management, customer relationship management (CRM) systems, and utilizing digital marketing over traditional methods. These technologies not only reduce the need for physical space but also allow for greater efficiency and scalability. Automating certain legal processes through technology meant we could focus our human resources on complex legal strategies rather than on repetitive tasks, optimizing our operations and significantly cutting down costs.”

—Adrienne Fischer, Basecamp Legal

13. Repurpose content

“Repurposing content is an efficient technique for companies to enhance their digital marketing efforts and increase their runway. We have effectively put this strategy into practice by producing evergreen content that works well in a variety of media and formats. Startups can optimize the value of their content without devoting substantial effort to creating new content by repurposing blog posts, articles, or films into infographics, podcasts, or social media snippets.

“Furthermore, using user-generated content to increase your brand’s reach and engagement can be an affordable strategy. In addition to offering useful social proof, encouraging customers to post their experiences, evaluations, and testimonials on social media or review sites creates real content that appeals to your target market. Startups can lower their content generation expenses and gain credibility and trust from their audience by implementing user-generated content (UGC) into their marketing strategy.”

—Shawn Manaher, The Content Authority

About the Author

Post by: Brett Farmiloe

Brett Farmiloe is the founder and CEO of Featured, a platform where business leaders can answer questions related to their expertise and get published in articles featuring their insights.