Setting up a small business has never been faster or easier, and it’s not hard to understand why. While grit and hard work will always remain a part of entrepreneurship, the 21st century has made the load a little lighter by introducing a range of tools and techniques that make starting and managing your own business more convenient than ever.
These different tools, and a quickly changing business environment, are what led to the rise of the startup. We’ve spoken about what exactly a startup is in our article on ‘Everything You Need to Know About Startups’. A startup, as we’ve mentioned previously, is about scalable growth at a fast pace.
Startups are flexible, adaptable, fun, and productive, with a host of other traits that set them apart from regular small businesses. If this is the kind of thing that excites you into thinking about starting one of your own, then have a look at a few things you need to know before launching your own startup.
Locating your niche
The first thing you’ll need to do is to figure out is whether your product or service is filling a need in the market. This can often be the hardest step, and is one that can take a lot of testing and research.
Fireart Studio CEO and founder Dima Venglinski says that your products should be dynamic and flexible, adapting to the needs of the market like a living organism. Figuring out how to do this can be difficult, but don’t be afraid to invest the time and money into getting it right.
Identifying your goals
The next thing you’ll want to do is to make your plans. The conversation around business plans in the startup world can be pretty complex. Some experts say you don’t need one as they can be too restrictive, while others say they’re essential for any type of business.
Business strategist Cat LeBlanc advises a happy middle — you don’t exactly need a business plan, unless you’re planning to raise funding from outside investors. Still, whether you choose to write out a strict plan or not, identifying your goals and a rough timeline is always helpful. Just make sure you’re leaving enough room to adapt to change when you need to.
Selecting a business structure
The next thing you’ll need to think about is your business structure. Will you try a sole proprietorship, which is low-cost but offers no liability protections? Or an S Corporation, which helps you avoid double taxation but might not be a flexible option? AC Corporation is another option if you want to go international but unfortunately doesn’t protect owners from double taxation.
Probably the most flexible and adaptable option for startups is the LLC. There are many benefits to registering as an LLC, such as a more flexible management structure, reduced personal liability, and better business branding. The process of registering as an LLC is largely the same across the US, although some states may require additional steps. Make sure to do your research and figure out which type of business structure is best suited to your needs and goals before moving forward.
Finally, the next thing you’ll want to do for your startup is to find funding. Startups, as we’ve said before, are defined by their fast growth, and in order to expand quickly, you’re going to need funding.
There are many ways you can do that, whether by using your savings, raising capital through friends or family, or trying to attract outside investors. Entrepreneur explains that there are many funding options available for startups, from securing lines of credit to trading equity. Try taking a look at what your business needs and what funding sources are available to you, and map out an approach that can help you get the capital you need to launch.