Before you start 

Starting your own business might be the best decision you’ve ever made. Who doesn’t want to have complete autonomy over their working hours and finances. To reach such a point typically involves a lot of sacrifice however, as there is a long laundry list of setup steps to be completed and admin before your first dollar even arrives. 

Some advice? Be consistent and focus on completing one task at a time. Setting up your business can feel overwhelming at times with a seemingly endless list of tasks, not to mention trying to bring in new clients, hiring staff, business insurance and more. 

The rewards are there however for those who keep it simple, complete each task as required and move onto the next step in the plan. Speaking of which, Step 2 below alludes to this, a Business Plan, very useful for keeping your goals on track. 

1. Find a business idea

What is the easiest business to start? What are you good at? Following your passions isn’t necessarily the best advice if your passions don’t make any money. Follow your talents.

It depends on your expertise, time commitment and capital. Many small-business ideas carry low startup costs and can be run from home. Conducting some market research can also be useful in assessing market needs and potential customers. 

Some few tips to help you along the way:

• A traditional business: Start a clothing business. People will always need to dress themselves, and regularly buy new clothes.
• An innovative business: Develop a mobile app based upon the latest tech innovations. Once upon a time, we used to call a taxi company for a taxi. Now, theres’ an app on your smartphone that can book a taxi in seconds.
• A professional business: Do you have a particular set of skills that others would be happy to pay good money to access your expertise and knowledge? You could become a tax advisor, an accountant, a reflexologist, a psychologist or social media consultant. 

Your skills will likely direct your business aspirations. Find out what you’re good at and explore the opportunities that may exist to start a business based upon this. Are you a qualified beautician? Or know-how in drop-shipping ecommerce products?

Whatever your skills or interests, a business plan will be a very useful resource before you start to keep an overall eye on the project plan, costs, steps required along the way and in general, to keep you focused.  

2. Write your business plan

A good business plan guides you through each stage of starting and managing your business. You’ll use your business plan as a roadmap for how to structure, run, and grow your new business. It’s a way to think through the key elements of your business.

Business plans can assist in securing funding or bring on new business partners. Investors want to feel confident they’ll see a return on their investment. Your business plan is also the tool you’ll use to convince people that working with you — or investing in your company — is a smart choice.

There’s no right or wrong way to write a business plan. What’s important is that your plan meets your needs. Many startups use a specific lean startup business plan.

Lean startup business plans focus on summarizing the most important points of the key elements of your plan. They can take as little as one hour to make and are typically only one page long.

Key elements of a lean startup business plan include: 

• Key partnerships: Note the other businesses or services you’ll work with to run your business. Think about suppliers, manufacturers and partners. 
• Key activities: List the ways your business will gain a competitive advantage. Highlight things like selling directly to consumers, or using technology for specific gains. 
• Key resources: List any resource you’ll leverage to create value for your customer. Your most important assets could include staff, capital, or intellectual property. 
• Value proposition: Make a clear and compelling statement about the unique value your company brings to the market.
• Customer relationships: Describe how customers will interact with your business. Is it automated or personal? In person or online? Think through the customer experience. 
• Customer segments: Be specific when you name your target market. Your business won’t be for everybody, so it’s important to have a clear sense of whom your business will serve.
• Channels: List the most important ways you’ll talk to your customers. Most businesses use a mix of channels and optimize them over time.
• Cost structure: Will your company focus on reducing cost or maximizing value? Define your strategy, then list the most significant costs you’ll face pursuing it.
• Revenue streams: Explain how your company will make money and list them all. Some examples are direct sales, memberships fees, and selling advertising space.

3. Secure financing to fund your business

Start-up costs are one of the obstacles that sometimes prevent people from ultimately pursuing their dream. The good news, however, is that even if you don’t have much money at your disposal, there are various options for financing your business, including

• Bootstrapping: Self-funding is advantageous because you maintain complete control of your business. On the downside, it can come with the highest personal financial risk.
• Small business loans: If you don’t have enough money, but still want to keep full ownership of your business, a loan from a business bank might be advantageous. Be prepared to show the bank a comprehensive business plan, as well as your estimated expenses and financial projections.
• Crowdfunding: Some people invest in a business in exchange for perks, as opposed to a share of the profits or company ownership. Because these perks are usually merchandise or name recognition, your business may need to be in the general consumer product or creative industries to take advantage of crowdfunding.
• Venture capital investments: Venture capitalists or “angel investors” may be willing to fund your business, but they usually expect board membership or a stake in the company. 

4. Choose a business structure

The business structure you choose influences everything from day-to-day operations, to taxes and how much of your personal assets are at risk. You should choose a business structure that gives you the right balance of legal protections and benefits.

You’ll need to choose a business structure before you register your business with the state. Most businesses will also need to signup for a tax ID number and file for the appropriate licenses and permits.

Choose carefully. While you may convert to a different business structure in the future, there may be restrictions depending on your whereabouts. This could also result in tax consequences and unintended dissolution, among other complications. 

Consulting with online company formation providers as well as business counselors, attorneys, and accountants can prove helpful.

Common business structures include:

• Sole proprietorship
• Partnership
• Limited liability company (LLC)