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So you want to open your business, eh? Once you have your idea, product or service ready to go, and want to actually get out there, here's a step-by-step path to getting it open.

So you want to open your business, eh? Once you have your idea, product or service ready to go, and want to actually get out there, here's a step-by-step path to getting it open.

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  • So, things you can do to get started out right. Let’s go through one by one.
  • First, your business structure

    I’m sure you’ve heard all about all of these.

    Which is right for you? There’s no one answer. It depends on what exactly you need.
  • And of course this is often a good place to spend some money on a lawyer.

    It’s important to know, once you form a business with a particular structure, it can be difficult to change, especially if you have partners. So, do it right to start with.

    Things I usually recommend people consider:
    Do you personally need protection from the risks your business exposes you to?
    Where are you rasing money from? Do they have preferences?
    How do you get out of the business?
    Do you need the business to outlive you? It’s morbid, I know, but some entities dissolve automatically upon the death of the owner, so this can be very important.
    How do you want to get money out of the business?
    Taxes. Everyone worries about taxes.
    Think about your personal taxes too. Yeah, you probably need an accountant to help you with this.
  • And of course this is often a good place to spend some money on a lawyer.

    It’s important to know, once you form a business with a particular structure, it can be difficult to change, especially if you have partners. So, do it right to start with.

    Things I usually recommend people consider:
    Do you personally need protection from the risks your business exposes you to?
    Where are you rasing money from? Do they have preferences?
    How do you get out of the business?
    Do you need the business to outlive you? It’s morbid, I know, but some entities dissolve automatically upon the death of the owner, so this can be very important.
    How do you want to get money out of the business?
    Taxes. Everyone worries about taxes.
    Think about your personal taxes too. Yeah, you probably need an accountant to help you with this.
  • And of course this is often a good place to spend some money on a lawyer.

    It’s important to know, once you form a business with a particular structure, it can be difficult to change, especially if you have partners. So, do it right to start with.

    Things I usually recommend people consider:
    Do you personally need protection from the risks your business exposes you to?
    Where are you rasing money from? Do they have preferences?
    How do you get out of the business?
    Do you need the business to outlive you? It’s morbid, I know, but some entities dissolve automatically upon the death of the owner, so this can be very important.
    How do you want to get money out of the business?
    Taxes. Everyone worries about taxes.
    Think about your personal taxes too. Yeah, you probably need an accountant to help you with this.
  • Now, a lot of people say “hey, a corporation protects me from liability.” That’s not quite true.

    A corporation protects your personal assets

    Insurance protects your corporation

    You may need insurance -- yes, even a start-up

    As an example, suppose you own a cleaning service
    You break a client’s priceless ming vase
    They sue you
    You’ve got a corporation, so they cant’ take your house.
    But your cleaning service is out of business
    And now you have no source of income
    It may pay to insure against foreseeable risks like these.
  • Often, I recommend that people who are in the process of starting up get a DBA first. This can help them particularly write checks and receive checks in the business name. If you want to sell to a business, rather than a consumer, you may need to have done this to be qualified as a vendor.

    You file your fictitious business name statement, which is cheap
    You get an IRS EIN, which is free
    And you get that bank account

    It’s easy and quick.
  • Choosing your location can range from a mundane task to one of the most essential parts of your start-up, depending on your business and how you plan to get customers.

    Don’t forget to think of both where you need to work and where you’d like to work. Make sure that you choose premises in which you can legally do the work you plan on.

    If you think you’ll be in the property for a long time, you may want to consider buying. The SBA offers some attractive loans for businesses buying property.
  • Having all your permits and licenses is important too! You can end up with big fines and back fees if you aren’t up to date.
  • Bookkeeping and Banking are boring but very important.

    It’s almost always the right idea to use Quickbooks.
    Get an accountant early on, pay them to set up Quickbooks and teach you how to enter your typical transactions. You’ll save money on having them redo your books later.

    Look for recommendations from within your industry. somebody with experience in your industry can give you far, far better service than somebody just learning the ropes.
  • As for banks, I recommend local banks where you can get more personal attention. If possible, look for one that specializes in your industry, you’ll get the best services from them. Moveyourmoney.info is a good site to find local banks and credit unions that are active in your area.

Transcript

  • 1. How to Start Your Business The Mechanics of Opening a Company by Wade Armstrong • Project: Liftoff • http://projectliftoff.com
  • 2. So You Want to Get If you’ve completed your business plan and are ready to get going — or are just eager to get a move on — then it’s time to put aside the planning and start the doing.
  • 3. So Where To Start? • Follow a specific start-up path • Minimize bureaucratic risks • Build a foundation for future success
  • 4. Get Things Started on the Right Foot By… 1. Choosing your Business Structure 2. Establishing a business location 3. Registering for permits & licenses 4. Establishing a bookkeeping system 5. Opening a bank account for your business
  • 5. Choose Establish Register Set Up Start Structure Location Permits Systems Banking Structure Options • Sole Proprietorship • General Partnership • LLC • S-Corporation
  • 6. Choose Establish Register Set Up Start Structure Location Permits Systems Banking Think About Your Goals • What’s your exit — sell for lots of $ vs. operate for small, regular $? • Does the business need to outlive you?
  • 7. Choose Establish Register Set Up Start Structure Location Permits Systems Banking Think About Your Partners • From where will you raise money? • Will partners have a say in operations? • How do you want to distribute profits?
  • 8. Choose Establish Register Set Up Start Structure Location Permits Systems Banking Think About Your Liabilities • Do you need liability protection for your personal property? • How will state corporate taxes impact you? • What kind of personal taxation is right for you?
  • 9. Choose Establish Register Set Up Start Structure Location Permits Systems Banking A Note About Liability... Corporation Insurance or LLC Protects Protects Personal Business Assets Assets
  • 10. Choose Establish Register Set Up Start Structure Location Permits Systems Banking First Step: Get a DBA 1. File a Fictitious Business Name Statement  http://www.lavote.net/clerk/business_name.cfm  Must run an ad too  Total cost: $40-$70 2. Get an IRS EIN  http://www.irs.gov/businesses/small  Free! 3. Open a bank account in your business name  Write and take checks in business name
  • 11. Choose Establish Register Set Up Start Structure Location Permits Systems Banking Where Do You Want to Work? • Can you save by working at home? • What kind of traffic do you need? Parking? • What zoning do you need to do your work?
  • 12. Choose Establish Register Set Up Start Structure Location Permits Systems Banking Permits: Boring But Necessary • Lack of proper permits may result in shut-down, fines • Find your permits at http:// www.business.gov/register/ licenses-and-permits/
  • 13. Choose Establish Register Set Up Start Structure Location Permits Systems Banking Bookeeping: Also Boring but Necessary • Quickbooks is universal • Find an accountant • Set up your books • Do the taxes • Important: Industry Experience!
  • 14. Choose Establish Register Set Up Start Structure Location Permits Systems Banking Your Bank is Your Partner • The right bank is a great partner • Products • Advice • I recommend a local, industry-experienced bank • Responsive • Aggressive lending • Find one at http://moveyourmoney.info
  • 15. Now get started! by Wade Armstrong • Project: Liftoff • http://projectliftoff.com