5 Steps to Start Your Business
Today.
Not tomorrow. Not a month from now. Not a year from now.
Today.
Today is the day and now is the time to start your business. To take your idea and turn it into something tangible. Something real.
I want you to set aside all the excuses. No more “It’s too risky.” No more “I don’t have the funding.” No more “What if it doesn’t sell?” No more “What if I fail?” No more “I don’t know where or how to start.”
No more excuses.
Don’t listen to all of that negativity rolling around inside of you!
Instead, listen to me.
“It’s risky” - So is driving your car.
“I don’t have enough funding.” - No one ever has enough funding.
“What if it doesn’t sell?” - What if it does sell?
“What if I fail?” - What if you succeed?
“I don’t know how to start!” - I’ll teach you how to start.
There is always going to be a million reasons not take the leap and get started. The timing will never be right. The market will never be perfect. But no matter what is holding you back, I promise you, if you start and keep working at it and do not give up, you will find success.
So get started now.
And to help you get started, I’m going to walk you through the five basic steps that you need to take in order to get your business up and running. By the end of this post you will know exactly what you need to do to get your business started! And make sure to check out my Free Startup Checklist that breaks down all the steps into one easy-to-follow guide.
Click Here to Get Your Free Startup Checklist!
So Let’s Get Your Business Started!
Step #1: Business Plan
Unfortunately, when most people think about a business plan, they imagine some 50-page document containing lots of charts, graphs, tables and other detailed information related to the projected performance of their business. Compiling such a document seems too daunting a task for many entrepreneurs, so most just skip this step altogether.
But you shouldn’t skip this step.
Don’t get me wrong- I am NOT suggesting in the least that you spend six months writing a 50-page thesis on your business complete with detailed financial models and projections. However, I am suggesting that you spend a few hours in front of your laptop really thinking through your plans and goals for your business. Check out my post on Business Plans to learn more, but in the least, you should spend some time thinking through the following:
- What is your business all about? - Describe the product you sell or the service you provide. What problem does it solve?
- Who does your business serve? - Describe the customer that buys your product or utilizes your service. How old are they? Where do they live? Where do they work? How much money do they make? What do they do for fun? Why do they need your product/service?
- How will you reach your customers? - What tools will you use to get your product or service in front of customers?
- How will you make a profit? - Break down what customers will pay for your product / service, how many customers you think you can / will serve in a given time frame, and the fixed and variable costs associated with offering that product to your customers.
Put some thought into these questions. Write out your answers in Google Docs or Microsoft Word. Once you have a few answers to these questions, you will have a basic business plan to follow for your business and you’ll be ready for Step #2.
Step #2: Legal
So now you have a basic business plan put together! Next, you need to work through the legal stuff. This can be relatively complex for some entrepreneurs / businesses, depending on the type of business you are starting. So if you have the resources, I suggest that you sit down with a business attorney to work through the legal and formation logistics. However, if you don’t have the resources to hire an attorney, you should be able to take care of the legal stuff on your own by following these basic steps:
- Entity Formation - The first thing you need to do is form a legal entity for your business. A limited liability company (LLC) is generally an acceptable entity form for just about any business. To form an LLC, you need to file a document called Articles of Organization (sometimes called a Certificate of Formation) with your state. If you want to try and do this on your own, check out www.nolo.com. They have step-by-step guides for LLC formation in every state. You can also check out www.incfile.com. For $50 (plus state filing fees), this site will help you get your entity formed really fast! Forming an entity will provide you as the business owner with an added layer of liability protection and will shield your personal wealth from potential creditors of the business. So do not skip this step- it’s worth the time and expense to do it right!
- Operating Agreement - Once your entity is formed you need to put together an operating agreement. This is a document that outlines who owns the business, how it will be managed and taxed, and how profits and losses in the business will be allocated amongst the business’s owners. If you hire an attorney to form your business, the attorney will prepare this document with you. You can also obtain forms for operating agreements online, including from www.nolo.com and www.incfile.com. This is an important document that provides evidence as to the ownership of the entity, so make sure you put this together for your business.
- Federal Tax Identification Number - Once you have your entity formed and your operating agreement in place, make sure to go to www.irs.gov and file for an employer identification number (EIN) for your business. This is like a social security number for your business and will be helpful when filing taxes and opening a bank account for the company. You can obtain this number online at the IRS website and it only takes a few minutes to complete the application process.
- Corporate Record Book - Once you have your Articles of Organization, Operating Agreement, and Federal EIN, take all of these documents and put them in a binder. This is your corporate record book. All legal documents should be placed in this binder, including meeting minutes, company resolutions, and amendments to the Articles or Operating Agreement.
Step #3: Banking
Now that your entity is formed, the next thing you need to do is open a bank account for your business. This should be a completely separate bank account from your personal bank account. Please note- you should never mix your business and personal accounts together. In order to open a bank account, take your Federal EIN number and operating agreement down to the bank. Simply tell the representative that you would like to open a bank account for your business. Between the operating agreement and the EIN, they should have everything they need to get an account opened for your business.
Step #4: Bookkeeping
At this point, it’s time to set up a bookkeeping system for your business. For many entrepreneurs, this can be somewhat daunting, but it doesn’t have to be. At the end of the day, bookkeeping is simply keeping track of the money your business brings in and the costs you incur in operating the business. There are several different approaches that you can take to keep your business’s books depending on the type of business you operate.
For example, if your business incurs minimal expenses and has consistent income, utilizing an Excel spreadsheet to track all income and expenses may be the easiest and most straightforward solution. However, for larger businesses with numerous expenses and various sources of income, a bookkeeping software should be utilized. I recommend Quickbooks by Intuit, but there are many other software solutions on the market. Whatever solution you choose, make sure you do not neglect keeping accurate books for your business!
Step #5: Marketing Materials
The final step in getting your business started is to put together your marketing materials. If you need some assistance with logo development and design you should check out www.99designs.com. There you can post a job for a new logo, website, or packaging design. Designers post comps that you can review and you only pay if you find a design you like. It’s a great service that you definitely need to check out if you are in need of design services.
You also need to get your website up and running. I recommend hosting with www.bluehost.com and if you need assistance getting your site setup, check out www.upwork.com to connect with web developers and web designers. If you are looking for a simple hosting solution where you can get your website up and running on your own, consider using www.weebly.com or www.squarespace.com. There are lots of other web solutions out there, but these two are inexpensive and simple to use.
It’s Time To Launch!
By following these steps you will be all set and ready to start your own business! The steps again are:
- Write basic business plan
- Form legal entity
- Open bank account
- Set up bookkeeping system
- Prepare marketing materials
Although you may think that it’s challenging to get a business started, it does not have to be overly complicated. Simply follow these steps and you will have you business up and running in no time at all! And make sure to download my Free Startup Checklist! This checklist will guide you through each step that you need to take to get your business off the ground. So check it out and best of luck to you as you launch your business!