Startups are playing an increasingly important role in the national economy. According to figures analysed by the Centre for Entrepreneurs, 608,100 new businesses were formed in 2015, an increase of 4.6 per cent compared with the previous year.

[easy-tweet tweet=”As #startups often do not have the financial clout of their larger competitors, keeping costs down can be vital”]

However, it has also been reported that as many as 90 per cent of startups fail, with spiralling costs usually the main culprit. According to CB Insights, 29 per cent of startups cite a lack of cash as the reason for failure, with 18 per cent blaming pricing and cost issues and 8 per cent stating that a lack of investor or financing interest led to their demise. Given that startups often do not have the financial clout of their larger competitors, keeping costs down can be the difference between success and failure.

One of the ways in which startups are keeping their budgets in check while still making use of innovative digital technologies is by embracing cloud computing. New businesses are adopting the full range of cloud solutions, whether that’s infrastructure as a service (IaaS), platform as a service (PaaS), software as a service (SaaS) or any other managed service. Crucially, the cloud’s subscription payment model makes it far more affordable for businesses than traditional IT solutions, where upfront CAPEX costs can prove prohibitive.

Take, for example, the way that cloud computing is helping startups to keep their resources more secure. Companies dealing with large amounts of data are also tasked with keeping this data secure. Perhaps they have the budget to build their own private data centre and invest in a wide range of digital and physical safeguards, but perhaps they do not. In this situation, cloud computing can provide the solution. For a subscription payment, startups can access a private cloud and a host of security options from their cloud vendor.

New businesses are adopting the full range of cloud solutions, whether that’s infrastructure as a service (IaaS), platform as a service (PaaS), software as a service (SaaS) or any other managed service

However, it is important to note that startups are using cloud computing for reasons that extend beyond finance. Scalability is another key benefit, particularly amongst businesses that are expanding at a rapid rate. With cloud computing, IT resources are owned and managed by a third party vendor and then leased amongst their subscribers. This means that if a startup needs more bandwidth or computational power, they simply have to request it from their vendor and perhaps pay an amended subscription fee. With traditional IT solutions, scaling up and down is much more challenging as in-house infrastructure may need to be overhauled, often at great cost.

What’s more, the cloud enables startups to compete with more established players by giving them access to the expertise and resources of their chosen cloud vendor. For example, with on-premise solutions startups would be tasked with the maintenance, security and administration of all their IT solutions, which may be challenging for firms that do not have in-house IT teams or large budgets. Conversely, businesses that use cloud services will have access to 24/7 managed support from their supplier. This has meant that a wide range of software and hardware is now available to startups, which previously would have been impossible to manage internally.

[easy-tweet tweet=”The #cloud lets startups compete with more established players – by accessing their vendor’s resources” hashtags=”zsah”]

Having experienced life as a startup ourselves, zsah is well aware of the challenges facing young businesses and so we have worked closely with a number of entrepreneurs to create the zsah Cloud Startup Program. By qualifying for the scheme, you’ll gain access to powerful cloud infrastructure, rapid scalability, 24/7 managed support and free credit for up to one year. There are many hurdles that startups have to overcome if they are to achieve long-term success. Fortunately, the rise of cloud computing has meant that accessing vital IT resources is no longer one of them.