Money will always pose problems for small businesses. Even well-funded companies will face money issues, usually because well-funded companies require significant overhead. So regardless of whether you're just starting out, or you've already received an angel investment, a large number of decisions for small businesses will center on money.

At the start it might seem wise to act frugally, foregoing expenses that might not seem necessary at the time. Who needs an accounting program when you can just use a spreadsheet for initial sales? Yet there is great value in finding the funds for expenses like this in the early goings. On top of those, there are a number of expenses that are absolutely necessary.

Sometimes the toughest decision is the one that costs you money. Here are some instances where businesses would do well to invest, knowing that they're planning for the long term.

1. Incorporation fees

A company cannot exist just because the founders will it. While the founders can create the spirit of a company, only the government can formally recognize one. That means jumping through all sorts of hoops in order to incorporate. In an ideal world this would be a straight forward process, but in reality it is complex and daunting for the average small business founder. That means bringing in outside help.

Incorporation fees themselves can run from a couple hundred dollars into the thousands, depending on the state in which you register. Chances are you're subject to the state in which you currently reside, because setting up an out-of-state address can cost you even more time and money. On top of that, you'll have to pay a company to fill out the registration papers and file them. So even if your state is on the low end of incorporation fees, you still have to pay someone to do it for you.

Think you can put it off? Some businesses can, at least for a little while, but it's tough to collect and distribute money without an official incorporation.

2. Office space

I've spoken with many aspiring business founders who think that they can avoid one huge up-front cost: office space. They can work from home, they say, and hire remote workers. This sounds great, and with modern communication tools it seems more viable than ever. Yet upstart companies who hire only remote employees will soon find that there are many pitfalls to this strategy. They include:

• Remote employees are more likely to flake on you
• Remote employees are more difficult to manage
• Remote employees might not be around when you need them
• Remote employees have a harder time collaborating, even with modern tools

A common office provides a sense of company unity. Everyone comes to the office daily, and everyone accomplishes their daily work there. While office space can cost a huge chunk of money, it is a worthwhile expenditure because of all the perks it provides.

3. At least one superstar

In basketball, teams build around superstars -- that one person who can carry the team when needed. Everyone else plays a specific role, but the superstar does it all. In the same way, small businesses should build around at least one superstar employee. The problem, of course, is that superstar employees don't come cheap, even with the promise of a lucrative future. They need to get paid now.

There are instances where you can find an underappreciated star and turn him or her into a superstar. It has happened before, and businesses have benefited greatly from it. But these are rare cases. In most instances, small businesses need that superstar up front, putting in the hours to ensure that the startup gets off the ground.

Given the choice between hiring one superstar and one support employee, and hiring three or four average employees, the former is far preferable. It might seem as though three or four could get more work done than one or two, but that's simply not true. The one superstar will provide immense value, helping build your business faster than four middling employees.

4. Accounting software

Above, I mentioned the idea of using a simple spreadsheet to keep track of a company's books. Startups with limited cash might look at alternatives and see a prohibitive cost. And yes, a spreadsheet can work well in the early goings -- if everything proceeds according to plan. Ask any business founder, though, and he or she will tell you that rarely, if ever, does everything go according to plan.

While you can keep decent track of your books on a spreadsheet, the temptation will exist to continue with that and stave off the cost of powerful accounting software. Wait too long, and you'll be scrambling to get that spreadsheet data into the new software. There's also the possibility that you need someone new to handle your books -- perhaps because the original employee found the spreadsheet a bit too easy to manipulate, wink wink -- and the new employee finds it unwieldy and unmanageable.

Starting with powerful software like QuickBooks from intuit.com might seem pricey at first, but they do offer plans that can accommodate startups. As your company and its needs grow, so can your QuickBooks plan. Yet even as you upgrade, your old data is stored and displayed as normal. Having that standard makes it much easier to handle accounting in all stages of business -- and might prevent an early dishonest employee from taking advantage of you.

Author Bio
Joe Pawlikowski founded a publishing company in 2007 and has worked with and alongside dozens of startups in the ensuing six years. He keeps a personal blog at JoePawl.com.