Starting a business is one of the most exciting things you can do, but it’s also stressful and it can go wrong very quickly. If you jump into it with little planning and forethought then you could end up losing your capital, your savings, and your mind.
There are numerous ways you can prepare for this exciting and risky endeavor though and in this guide we’ll look at 5 of the most important things to get out of the way before you start your new business.
4. Deal with Your Personal Debt
It doesn’t matter how well you budget and how sensible you are, there will come a time when you need to inject some more of your personal funds into your business. If you’re in debt then your only options will be to let your business fail or to take out a loan, neither of which is a sensible choice.
To ensure you never have to face this issue, make sure your personal finances are comfortable before you launch your business. You should never sink too much of your personal finances into a failing business, but that’s not the goal. You just want to make sure that if your business needs a few hundred or thousand dollars to stay afloat, you can afford to cover the cost before bankrupting yourself.
If you are heavily in debt there are a few ways you can balance the books before you move forward. These include debt settlement and debt relief programs, such as Global Client Solutions, National Debt Relief, and dozens of other companies that operate in this sector.
3. Run Your Idea by Someone Else
Everyone has so-called “great” ideas, only for these ideas to sound incredibly stupid once they have been aired-out a little. How many “great” ideas have you had when drunk or under the influence of recreational drugs? How many did you have when you were young, only for you to roll your eyes in embarrassment every time you think abut them now?
These ideas can seem great at the time, but less so when you’ve thought about them some more or run them by a few friends. Think about the failed businesses on Shark Tank, the ones that seem absurd to everyone but the owner, the ones that they have sunk huge sums of money into, even though investors, friends and family members advised them against it.
It’s hard to admit that something was a bad idea after you’ve sunk your life savings into it, so rather than acting upon an idea straight away and then running with it, talk to some friends about it, think it over and give it time to air-out. If it still sounds like a great idea a few weeks or months down the line and you’re getting positive responses when you talk to friends about it, you could be onto something.
2. Make Sure You’re Compliant
Starting a business is not as simple as having an idea, a name and a website. If you’re selling a food item then you need to follow a long list of regulations. If you’re selling anything containing alcohol, you’ll need a license. If you’re importing products or packaging from abroad then you’ll need to think about import taxes, customs regulations, and more.
In many countries you’ll also be required to have a business bank account, and getting one of these isn’t easy as your personal finances will be taken into account—if you have a poor credit score then you may be refused. In other words, you need a business bank account to establish a business, but getting that account is neither easy nor quick.
There is a lot to consider and these things can consume a lot of your time and your capital, so make sure you’re ready for them. If this is your very first business then it’s best to be conservative with estimates concerning how long it will take to set your business up and go through the motions. If common sense dictates that a process will take a few weeks, give yourself a few months. There is a lot of red tape to clear and it’s never simple.
1. Don’t Forget Trademarks and Copyrights
Finally, make sure that your brand is protected with copyrights and trademarks. Copyright laws vary from country to country. In the US it’s an official process that you will need to register for, in many other countries simply publishing content and being able to prove that you published it first is enough to claim the copyright.
Wherever you are, however, you will need to apply for patents and trademarks and these are always essential. A trademark protects your brand from anyone copying it and exploiting it.
It will also protect you further down the line. If a company takes issue with your name for whatever reason, then you may have little recourse if it’s not trademarked. If it is, then that company will be expected to explain their grievances during the trademarking process and will be ignored if they instead raise them at a later date.
Trademarks can take a while to go through, but many of the issues above can also take time. That’s why it’s best to take things very slowly and to make sure you don’t rush any aspect of it. Not only will this extra time ensure that no mistakes are made, but it’s also more time to grow your savings and prepare your personal life. In other words, unless you were crazy enough to buy perishable stock before even getting a trademark, or you have an idea that is somehow time restrictive, there is no reason to rush.
