Start-Up Tasks Not To Overlook
Starting a business is an exciting time, and while most people starting out as entrepreneurs know they’ve signed up for a lot of work, it’s important to make sure you don’t overlook some of the startup responsibilities that will be important to getting your business off the ground and moving in the right direction.
Here are some responsibilities that shouldn't be overlooked and, ideally, are addressed at the start to avoid issues down the road.
Business Plans
Business plans are important, but not necessarily in the form or format that might be most discussed or found online. Sure, a SWOT analysis and breakdown of your competition might be important, or necessary for a document you’re going to submit to the bank for a loan, but that’s not the most valuable way to approach your business plan. What you want is a 1-2 page plan that lays out your most important goals over the next 12 months, max, the metrics that will be used to track those goals, and who’s responsible for achieving them (if you’re just starting out it likely you and any partners you have).
Form A Business Entity
It’s surprising how often this step is overlooked. Start a formal business entity (LLC or corporation most likely) with the appropriate state office. It’s pretty affordable in most states and the potential of being personally liable for the acts of the business without one clearly makes this a step not to be overlooked. Just to clarify that, as a sole proprietor or partnership you and your partners are going to be on the hook for everything that happens in the business, that mean debts, liabilities, and obligations that the business can’t cover will be covered by your personal assets (things bank accounts and your house).
Budgeting and Funding
Spend some time thinking about how much money you’re going to need to get the business up and running, where you’re going to generate revenue, and realistically how quickly and how much revenue you can generate. Here’s a tip – you're almost certainly overestimating how soon and how much money you’ll bring in during the first year. Then think about how you’re going to fund the business, with the understanding that your options may be limited. Possible funding can come from your own cash, a bank loan, credit cards, investors, friends, and family, or crowdfunding for a few options – just realize that all of those probably aren’t on the table for you at the very beginning.
Accounting
At the very least, put in place some sort of system to manage your books and accounting. A spreadsheet will work (however that doesn't mean it’s what you should be doing), but there are numerous online apps or software options that work well. Setting up books isn’t the most glamorous part of starting a business, but it will be extremely important to your success. You’ll use this information to track certain aspects of your business, make decisions about where to invest money and some of your important metrics are likely tied to the company books. Hiring an accountant and bookkeeper to handle this is an option as well but may not be budget-friendly when you’re starting out.
Have questions about what type of systems and steps you need when getting started? Contact us for a free consultation.