As an entrepreneur, there are many enjoyable aspects involved with starting your own company. Coming up with a brilliant idea, developing your product, performing market research, analysing your competitors, formulating a business strategy, the list goes on! But before you can start making money from all the hard work you’ve put in, there are many practical, governmental, and financial considerations you should get in order before you can start.
These will vary depending on your industry, your product, and your business model, but a few things are universal. This article will walk you through a few necessary steps to ensure your startup business is registered and established correctly.
✅ 1. Find a Catchy Name
Finding a name for your startup is, for many entrepreneurs, a very time-consuming task, and with good reason! Your name is your first impression. It needs to be catchy, SEO friendly, and it should be a name that you love. . And worst of all, when you finally find the perfect name, you need to make sure the domain name is available, which is most likely is not 😭 You can read a great article from Failory.com about naming a startup here.
✅ 2. Design a Dazzling Logo
You found the perfect name, so the next step is, of course, to design a dazzling logo. Your logo should wrap up your business identity in a small quadrant. Choose your colors, statement, font, and shape wisely, as it will be difficult to change. You can have a graphic designer make it for you, or give it a try yourself. We recommend two incredible tools for beginners if you want to make it yourself. Logomaster and Tailor Brands. Give them a try!
✅ 3. Get Ready for Your Elevator Pitch!
To validate your product, you will need to sell the idea to as many people as possible. People are busy, and time is precious. If you can sell your product in less than three minutes, you’ve come a long way. That’s why your elevator pitch is essential. Read more about what makes a great pitch here.
✅ 4. Make a Business Plan that Will Make Investors Fall at Your Feet
Now you know you can sell your product, but can you run your company? A business plan is vital for your business. A business plan can help your startup grow up to 34% faster than startups without a business plan. You need to know your business’s strengths, weaknesses, and potential. Read more about creating a business plan and download our free Business Plan Template here.
✅ 5. Strategize Your Marketing
You’ve got a great product, a dazzling logo, and a pitch worth dying for. It's a sure thing! Unless you forget to tell people about it. Marketing is essential - don’t underestimate the time and money you spend on it. Find out who your customers are, where they are spending their time, and how to reach them. Then you can figure out if you want to spend your marketing budget on PR, social media, or print. If your business is online, you should look into SEO and Google advertising.
✅ 6. Create a Budget
A budget is a crucial aspect when starting a business. Not just because your bank and potential investors will be interested, but also to utilise and help your startup. Creating a sound and sustainable budget will increase your business’s chances of success, and it will make it easy to track your key metrics throughout the first stages. The hard part about creating a budget is to base it on realistic assumptions.
6.1 Summon Your Inner Fortune Teller to Predict Your Sales
An essential part of your budget is your sales forecast. Not even the most experienced entrepreneurs can look into the future, which means that a sales forecast will be nothing but a qualified guess of your business’s future revenue. However, it is crucial since you and possible investors will use it to navigate continuously. Read more about creating a kick-ass forecast here.
6.2 Make the Cash Flow
In the first stage of your startup, you will have more expenses than revenue, but at some point, you will need to break even. Forecasting your cash flow will help you understand your income and costs, and it is crucial to keep your business in business. There are many great tools to create a cash flow. You can easily find templates online or use our budget tool within the planning app.
6.3 Liquidity: If You can’t Pay, You Close Down
Probably the most crucial financial statement is your liquidity report. Many startups fail not because they run out of money but because they run out of money at the wrong time. While your cash flow tells you how much money is going in and out, your liquidity budget tells you when they are going in and out and if you have the cash to pay your creditors when due. This budget is especially important if your business’s payment terms allow your customers a more extended due date for payments than your creditors give your business.
✅ 7. Accounting - Make it Easy!
Now for the not-so-fun parts about running a business: Accounting. Even though very few entrepreneurs see accounting as their favorite activity, it’s an essential part of running a business. Not having your books straight can end up being very expensive. In general, there are two options for accounting. Hiring an accountant or doing it yourself. Using accounting software can lighten your workload immensely, but if your time is spent better elsewhere, it might be clever to outsource that task.
Another important step is to create a bank account and a payment method for your customers. Before you start accepting payments from clients, it’s essential to make sure your personal and business finances are separate. You may consider using a bank that offers lower banking fees for small businesses.
Depending on your business, your payment method can be online payment on a website, physical payments in a store, or even manual invoicing. You’ll find numerous solutions on the market for all options, and the pricing is often connected to the amount of money you’re expecting to receive. Here is where your budget becomes helpful to you.
There are many software on the market that makes accounting easy and, let’s be honest, almost fun. We recommend Quickbooks.
✅ 8. You Need a Bank Account if You Want People to Pay
And of course, you do! Talk to various banks before choosing the one. Some banks are great with startups and offer a lot of assistance, and others don’t. There is a significant difference between what they offer and how much they cost, so make sure to do your research.
✅ 9. Hurry Up and Buy Your Domain!
Your website needs a name, and preferably the name of your business. Hurry up and get yours before someone else does. When you buy a domain, you can choose different extensions, and they have different advantages. Which one is right for your business? .com, .io, .org? Choose the one you want, or buy them all if you’ve got the budget for protecting your business name. It won’t be hard to find a site selling your domain, but we recommend Google Domains and One.com.
✅ 10. You got Your Domain, Now get a Host
Your domain needs a web hotel if you want to build a website. Consider how much space you need, how much traffic you expect, and how much support you depend on. It’s a big market, and there are many options. Here we recommend Google or AWS. As a customer of our business plan software, you can also register and host your website for one year for free at One.com.
✅ 11. Time to Showcase Your Product. Make a Website!
It’s the 21st century, and everyone needs a website nowadays! Actually, a website is crucial for the survival of your business regardless of your product and industry. For some entrepreneurs building a website comes naturally, and for others, it’s compared to climbing Mount Everest. If it's a mountain climbing task for you, you might consider hiring another business to do it. However, depending on the needs of your website, it can be relatively easy to learn. These days there is much software such as Wix, Squarespace, and Shopify that make it a walk in the park to create a beautiful and functional website.
✅ 12. Web-based Security and SSL
When you have a website, it's essential to consider what kind of security you want to install on your website to avoid hacking or server breakdowns. These days problems on your website can set your business back for weeks. If you’re going to accept payments on your site, for example, an SSL certificate is an excellent idea. It will gain your customers’ trust.
✅ 13. Get a Payment Solution
Whether you are a physical or a web-based business, you will need a payment solution. Again there are many options. Prices depend on your expected number of payments, your basket size, and an establishment fee. Now your budget comes in handy! Take a look at our recommended payment tools here.
✅ 14. Legal Topics to Address
When it comes to legal matters, there are quite a few factors you need to consider before launching your business. The first is the legal formation of your company. Different formations will give you different liabilities. Make sure to talk it over with a legal counselor before making a decision. There might also be some specific laws tied to your industry. Contact a branch organization to get more information about those.
Next, you need to consider your Terms of Condition and the GDPR. Those are required for all businesses. Your Terms of Condition are used to protect yourself from potential wrongdoing, They set the terms for the use of your product or service, and establish your business’s liability to your customers.
GDPR (General Data Protection Regulation) is an EU regulation implemented to protect EU citizens’ personal data. Read them through, and figure out how to accommodate them in your business.
Taking care of all the above-mentioned legal issues might be a tedious task in your startup journey, but they can prove to be life or death to your business, so handle them with care.
✅ 15. Create Lifesaving Terms of Condition
And speaking of legal, few things are universal. You have to write your terms of conditions. Your “terms of conditions” is the contract you sign with your customers, clarifying your business’ liability and the rules for the use of your website. Note that Terms of Conditions are not legally required, but it will save you a lot of trouble.
✅ 16. GDPR - Protection of Data
If you are a European business, you should read carefully now. GDPR (General Data Protection Regulation) is an EU regulation implemented in 2018 to protect EU citizens’ personal data. The regulative demands quite a lot from businesses, and you should read the rules carefully to figure out which initiatives to take in your business. Now, this might be heavy reading, but the fines for not complying make it worth your time.
✅ 17. Get Business Insurance
When it comes to insurance, the rules depend on the country in which your business is registered. Some countries legally require you to ensure your company or your staff, including yourself. Insurance is not only to avoid liability but can also be in case of legal problems or if someone hacks your website and takes it hostage (yes, these things do happen), or simply if you spill coffee on your new Macbook pro like I did last week! Call an insurance company to learn about your options.
✅ 18. Shareholder’s Agreement and Equity
If you are a solo founder, you can skip this one, but if you’ve partnered up with the co-founder of your dreams, this point is important. When you register, you will need to share the ownership of the company. That calls for an important talk.
Do you want to share it equally? What happens if one of you wants out? If one wants out, will the one left need to buy his shares? And if so, at which price? What positions in the business will you each possess? These are all crucial questions that we highly recommend having sorted out before launching your business, as partnership-disagreement is a common reason why start-ups fail.
A Shareholder’s agreement can be solved within your founder team by a simple contract. Still, we highly recommend getting help from a lawyer who can help you understand every possible outcome.
✅ 19. Choose the Appropriate Business Structure for Your Startup
Choosing an appropriate business structure that matches your needs is a necessary step in registering your startup. Two main structures are suitable for startups - corporation or limited liability company (LLC).
To note, sole proprietorship and Partnerships are also known business structures but are not considered ideal for startups. This is due to a lack of legal separation between the business owner and the business - meaning full liability if things go south.
A corporation is the business structure many people think of when it comes to businesses. It has a complex legal structure comprising shareholders, which can make tax requirements more intricate and complicated. Here are some key points regarding corporations:
- Corporations offer a higher level of protection for personal assets than individuals. This is because the liability for corporate wrongdoing is usually limited.
- Corporations also offer a greater possibility of raising capital.
- Corporate taxes are filed separately from personal taxes, which means that businesses can take advantage of corporate tax breaks.
- A corporation is the most challenging company structure to set up.
Limited Liability Company (LLC)
An LLC allows businesses to have the benefits of a partnership (being easier to run), with the protection of a corporation. This means that profits and losses pass through to the business owners, who can include them on their personal tax returns. Here are some key points regarding LLC’s:
- LLC’s enjoy greater tax incentives.
- An LLC provides a layer of protection for the owner’s personal assets in case they are sued. If someone sues the business, they cannot go after the owner’s personal property or money.
- LLC’s are complex to set up but not as complicated as Corporations.
✅ 20. If Unsure, Get Specialist Help
If you want to start a business, and you're not very confident about the legal requirements, you'll need some help. Defining your liability and growing your business can be difficult without someone with experience. This will protect you from any legal implications that may arise.
If you are unsure about how to legally go about starting a business, consulting a legal expert will help in providing you with advice on the best way to register your company and make legal decisions, which will make the process of starting and growing your business much easier.
✅ 21. Time to Get Real! Register Your Business
When you’ve built your product or service, done your research, made a business plan, and topped it off with all the above points, there’s only one thing left to do: Register your business. To start a business, you will need to register it with the government before you can legally run it.
This is important because if your business name is already in use by someone else, you will not be able to sell your products or services. It is also important to make sure that your business name has unique branding so that customers can easily identify it.
✅ 22. Create an Inspiring Work Environment
Time to get to work! To do your best work, you need the best possible environment. You might work best in an office space surrounded by other entrepreneurs, or you might work best at home. Whatever you choose, make sure to dedicate an office space for your business.
Establishing a startup business is not as difficult as you might think. With the proper planning and guidance, you can be on your way to reaping the rewards of all your hard work in no time.
And now, you are ready for launch! 🚀
- How to Establish a Startup Business?
- Find a catchy name
- Design a dazzling logo.
- Get ready for your elevator pitch!
- Make a business plan that will make investors fall at your feet.
- Strategize your marketing
- Create a budget
- Accounting - make it easy!
- You need a bank account if you want people to pay
- Hurry up and buy your domain!
- You got your domain, now get a host
- Time to showcase your product. Make a website!
- Web-based security and SSL
- Get a payment solution
- Legal Topics to Address
- Create lifesaving Terms of Condition
- GDPR - Protection of data
- Insure your business
- Shareholder’s agreement and Equity
- Choose the Appropriate Business Structure for Your Startup
- If Unsure, Get Specialist Help
- Time to get real! Register your business.
- Create yourself an inspiring work environment