Starting a business is daunting.
There is so much to think about and so much to do.
It’s hard enough trying to figure out how to build and grow a business. The last thing we want to think about is figuring out how to put together an operating agreement or picking the right accounting system.
The good news is that all of the things that need to get done in order to start your business have been done a million times before. You don’t need to reinvent the wheel or waste brain power on figuring out what to do.
There are at least 23 things that you should do when starting a new business and we can walk you through each one of them step-by-step.
I’m going to assume you already have a business idea, and I’m not going to show you how to build or grow your business in this article. These are the practical steps, necessary to begin operations.
1: Put together a very high level and basic business plan
Don’t overthink this. You just need to be able to answer two big questions:
- What do you need to do in order to get to profitability?
- How are you going to pay for the things that you need to do in order to get to profitability?
If you think long and hard about these questions, you’ll end up with a good starting plan. Be realistic about what it’s going to take. Do your research, and know your numbers. Put it all to paper, and the business plan will evolve into a useful tool and true north for at least the first 6–12 months.
2: Come up with a name
Coming up with a name can be harder than doing the business plan! Your name is…well…your name. It has to be good. It does not have to be perfect and it does not have to be a fancy, made up word like Google or Yahoo. Generally speaking, here is what matters:
- You have to be confident in the name. Honestly, this is probably all that really matters. It’s definitely the most important aspect of coming up with a name. If you don’t love it, then you can’t sell it. You’re going to be selling it 24/7/365 for a long time. At least that is the plan!
- You need to pick something unique. The general rule of thumb is that when you search Google for the name there isn’t an established business or product that already has the same name.
- Your name must be memorable, brandable and simple. You don’t want to make it harder than it already is to be found and known.
- You need to have the .com of your name. This is critical! It’s unbelievable how many people take this for granted and just completely disregard their domain name. If you want people to take your business seriously, make sure you have the .com.
A good process for coming up with a business name:
- Brainstorm words, concepts, ideas, beliefs, descriptors, etc.
- Brainstorm names based off your initial brainstorm in step 1.
- Check the names in Google. Delete any options that are already a known business — especially not one in your space.
- Make sure the domain name can be acquired. Check out our guide on how to buy a domain name for help here. Do not expect to register a domain name for $7/yr and call it a day. You really need to invest in a domain name for your business name. If you have a tight budget, get creative! You can get a great name that checks off all the boxes for under $1,500 if you put in the effort.
More tips for coming up with a name:
- Imagine your name with a logo on a big sign in your future office space.
- Imagine your name on a T-shirt.
- Say your name out loud. “Hi, I’m Name from Business Name.” How does it feel? Do you like how it sounds?
- Bounce your options around and talk to people about it.
- Spend some time thinking about it and let it sit for a while. Do you continue to come back to the same name?
3: Buy your domain name
Again, do not take this lightly! It is not an area that makes sense to be cheap. We use Namecheap to buy our domains — you can read more about why in our review of the best domain registrars.
4: Set up social media accounts
It’s tough enough to find a good name where buying the .com is possible. Chances are, you won’t get exact match social media handles as well. Do everything you can to get them, but if that fails — get creative. Your social media handles / urls are much less important than your website, but they’re still worth putting effort into.
5: Develop a brand identity
It’s nice to have a logo, colors, fonts and a general look and feel to go along with your name. You can always update your brand identity down the road, so the initial run just needs to be good enough. 99 Designs is a great option for a full brand identity package. You can run a design contest that allows you to pick from hundreds of options.
6: Get some business cards
Your brand identity package from 99 Designs will come with business card designs. You can use them to get business cards printed online by Vista Print.
7: Find an accountant and an attorney
This one is easy to put on the back burner. You’ll save yourself a lot of hassle and potentially save your business altogether by getting ahead here. Line up the legal and tax pros ahead of time. There are lots of great options and your accountant and attorney can both be remote.
We haven’t personally used it, but we’ve heard a lot of good things about Upcounsel.
8: Set up an LLC
You can use your attorney for this, or you can use a service like Legal Zoom. Setting up an LLC is simple, so it’s a good spot to save some money by using a service like Legal Zoom.
9: Get an EIN
Getting your Employer Identification Number is something you can take care of along with the LLC. They typically go hand-in-hand. You’ll need that to do just about everything, including business banking.
10: Create an operating agreement
Even if it’s just you, an operating agreement is needed. Unless you have other people involved with your business, you can definitely get away with Legal Zoom here. Chances are, things will evolve and you will update your operating agreement down the road anyway. If you do have other people involved, have your attorney help out here.
11: File necessary paperwork with your state
If you’re using a lawyer, they can do all of this for you. Otherwise you’ll need to do some research into the requirements in your state, which also vary depending on the type of business you’re starting.
12: Set up 1Password
By now you are starting to see the theme here: Reduce future headache! Set up your systems now and you’ll be able to focus on growth moving forward.
1Password is an excellent tool for managing all of your passwords and sensitive data. It makes it easy to securely share logins with your team — which is key because Centrify estimates that lost passwords cost $416 in productivity per person.
13: Open a business bank account
Pretty straightforward. You’ll need that EIN. It’s typically most convenient to go with the same bank you’re already using for your personal accounts.
One thing to watch out for is a the upselling that many of the bigger banks do. For example, with Bank of America, we went ahead and took them up on an offer for Intuit Payroll. It ended up being a terrible user experience. The people at Intuit recommended that we sign up for a new account directly with Intuit because they couldn’t figure out how to solve some of the problems we were having. They put the blame on Bank of America. This ended up working out because instead of signing up for Intuit Payroll, we researched other options and found Gusto, which is much better.
The point here is to use your bank account for a bank account and be wary of using them for other offers or services.
14: Setup a G Suite account
G suite is the most important tool for our business. We do almost everything using G Suite. Our emails and calendars are all on G suite. We also rely heavily on Google Drive / Docs.
You’ll need to get this set up as soon as you have your domain name. Then you can easily get your business accounts set up.
15: Create a basic, foundational website
Your website can be a very big project depending on your business. In some cases your website could be the business. That’s why the focus here is simply on a basic, foundational website.
It’s good to have a one-page site live with information about your company. Then you can build further from there.
You can be up and running in the matter of minutes with Wix. Once you’re ready to do a full feature website, it’s easy to switch over to WordPress.
16: Set up a payroll service for employees and contractors
We like Gusto. They are very good. We use them and find their service to be superior to Intuit Payroll.
You won’t need to worry about this until you start paying employees or contractors. It’s good to have it ready and on deck though. Not only will the service automate your payroll, but it will also take care of taxes and forms that need to be filed.
17: Set up Quickbooks
A Quickbooks account is essential from day one. This is how you’ll manage your books and ensure you always have good records. Going back and importing historical data isn’t fun. The sooner you get it set up the better.
18: Put a basic accounting system in place
The best bet here is to work closely with your accountant. A good approach is to ask your accountant what you need to be doing throughout the year to make things easier when tax season comes and to make sure all quarterly obligations are met.
Quickbooks does all of the heavy lifting, but there are still things you’ll need to stay on top of. There is some crossover with what’s already been outlined here, but Shopify put together a good guide on small business accounting.
19: Create a subscription tracker
This is easy but often overlooked. 1Password is great for keeping track of your subscription logins. You still need some way to quickly see everything you have and what you are paying for, especially as you grow and have more people using and signing up for different tools and subscriptions.
A simple spreadsheet is all you need. Track the subscription, cost per month or year, terms (if any), payment method (what account or card is it tied to?), and renewal date.
20: Start using a project management solution from day one
The biggest thing here is to get in the habit of tracking all of your work. Even if you are the only person in your company, you should operate like an organization because someday you will have no choice. The other benefit besides creating good habits is the historical information and data that will come from working like this starting day one.
It’s very valuable for new people to come into your organization and be able to look back at what work has been done in the past. It’s context that will help them (and your business) be successful going forward.
It doesn’t matter what tool you use. You’ll likely change it a bunch of times anyway. We use Trello. There are dozens of great tools.
21: Build an internal wiki system from day one
Just as you should use a project management tool from the very early stages, it’s extremely valuable to start documenting everything right away.
If you ever want to scale your startup, you’ll need your brain to scale too. Your internal wiki is like your brain. Giving your future team instant access to your brain is huge. If you already have a disciplined approach to documenting things in the wiki, your team will follow suit.
It’s not fun figuring out the value of a wiki system 3 years down the road, 50 people deep. You’ll think of an endless number of documents you wish you’d have written out as you went along.
We use Confluence.
22: Set up a Slack account
Everyone loves Slack. It just works. Mobile communication is key.
23: Create a strategic plan for the next 12 months
Like your business plan, your strategic plan doesn’t need to be complicated.
Here’s how to write a simple startup business plan for year one:
- Come up with one big goal for the next 12 months.
- Determine what you need to do in order to reach your goal. What projects or activities will you need to perform?
- Figure out what metrics or parameters you can use to monitor progress. Put in place a system for tracking them.
- Review and challenge monthly. Make any necessary adjustments.
Even in a one-person shop, taking the time to do this will force strategic thinking and purposeful action. It will help you avoid being reactive and randomly doing whatever comes your way.
It becomes even more important when you have a team that needs to know what direction to march. They will need that context in order to do their jobs.
Other guides written on how to start a business are pretty general. I don’t see a lot of value in reiterating what is already out there, so here is a list of guides that I would recommend for further reading on how to start a business:
- Startup Checklist by Business Know How
- Guide for Entrepreneurs Starting a Business
- 105 Best Tools to Start Your Business
Source: quicksprout
How To Start a Business: 23 Steps To Becoming Operational