The process of starting a business looks very different today than it did even just a decade ago. Because of legislation like the JOBS Act and technology that has globalized the world, finding investors and consumers is easier than ever. However, something that hasn’t changed in the last 10 years, and even longer, are the steps it takes in the first 90 days to ensure, or at least improve the chances of, future success.
Here is a guideline to help you get organized as you take this leap:
1. Flesh out your business idea.
First, you need to write out a business plan. There are plenty of templates and guides online that will provide you with the basic structure. Second, you will also need to find financing—maybe it’s investors, maybe it’s a loan, maybe it’s your savings. Third, you need to create a marketing plan. You need to figure out how you will break-even and start creating profit as soon as possible.
2. Pick out your legal structure.
Figure out how many people will be owning your business and who gets what percentage. Find out what potential business risks might be ahead, and how much personal liability protection you may need. Next you need to decided on a type of ownership structure. Now this can be tricky. You need to choose between sole proprietorship, partnership, LLC, C corporation, and S corporation. All of them have their benefits and drawbacks. You might want to speak with an accountant or an attorney to figure out what would work best for you. (A few things to consider: Do you want to sell stock? How do you want to be taxed?)
3. Time to pick out a name and register.
This is pretty straight forward. Make a list of potential names, check with your county clerk, Secretary of State, and do a trademark search to see if the name is taken. Also check to see if a potential domain name for your website is available. Then go and register it your name and buy your domain.
4. Paperwork– you can’t avoid it forever.
You’ll need to prepare some organizational paperwork. If you are choosing to go with a partnership structure, you’ll need a buyout agreement and a partnership agreement. For and LLC, you’ll need a buyout agreement, an operating agreement and articles of organization. A C corporation will need a pre-incorporation agreement, articles of incorporation, corporate bylaws and a buyout agreement. An S corporation will need to file IRS Form 2553, as well as a buyout agreement, corporate bylaws and articles of incorporation.
5. Choose your location.
This will mainly be based on your budget and how much you can afford to pay for rent—or potentially purchase real estate outright to have one less liability and one more asset as a business. But some things to consider include the fixtures and features you will need in the office and the optimal neighborhood for your business and the customers you hope to attract. Oh, and don’t forget to make sure the location is zoned for commercial use.
6. The government needs some more information from you.
You’ll need to get a federal employment number from the IRS and any state permits or licenses (i.e. a seller’s permit if you are selling retail goods, environmental permits, vocational license, and business license).
7. Protect yourself.
Get insurance for yourself, your business and your business assets (i.e. medical and liability). And if you’re working from home, make sure your homeowner’s insurance will cover theft of or damage to your business assets.
8. Get your accounts in order.
Now its time to get down to the math. For this part, you might want to meet with an accountant because the jargon of accounting can be overwhelming. Some of the decisions you will need to make include using cash or accrual accounting, what your fiscal year will be, and how you will keep records of payments into and out of your business. Also, make sure to find out what taxes you will have to file every year and what deductions you might be able to make in your line of work.
9. Find a mentor and recruit the best talent
In business, as in life, it’s important to learn from people who have previous experience. When starting a new business, find a marketing expert, small business owner or CEO who has been through their share of ups and downs and learned life lessons through the process. Also keep in mind that recruiting is an important process is growing the company to profitability. When looking for a logistics candidate for example, there are characteristics to look for beyond just the basic ability to handle core tasks. They should also possess the qualities of accountability, trust, quality and collaboration, and see the bigger picture when it comes to their work.