Like so many, I was laid-off last year and started freelancing while looking for a job, but unexpectedly, I was getting so much work that I decided to start my own business and became an LLC (Limited Liability Corporation).
Now nearly every week, someone asks me one of these questions: “How did you start your business?” “What steps do I need to take?” “How do I get an EIN number?”
Launching your own business can be one of the most exciting and rewarding things you’ll ever do. It certainly has been for me. Of course, it does take some serious thought and planning.
So, here are some key steps (the way I see it) to take your business idea from fantasy to reality:
• Brainstorm your idea. First, make sure that you’re truly excited about your business idea. I believe deeply in this. The more passionate you are about your company, the more likely you are to succeed. Next, do your homework. Is there a growing need for the product or service you want to sell? How can you set yourself apart from the competition?
• Protect your idea. Have you come up with a great new name for your company? A revolutionary idea for a unique product that will change people’s lives? First, pat yourself on the back. Then, visit the U.S. Patent Office to register—and protect—your idea.
• Choose your business structure. Will you be a sole proprietor? Form a partnership with a friend or colleague? Create a corporation or limited liability company? Investigate your options.
• Get an employer identification number (EIN). This unique number—also known as a Federal Tax Identification Number—will be used by the IRS to identify your business. If you’re a sole proprietor, your social security number may suffice. Take this short quiz to determine whether you need to apply for an EIN.
• Open a business checking account. You’ll need to show proof that you own a business, so check with your bank to see what paperwork they require.
• Create a business plan. You need a roadmap to get to your destination, so don’t skip this important step. A business plan details your business idea, your target market, your team, key milestones, how much money you’ll need, and more. Not sure how to start? Watch the Small Business Administration’s 30-minute business plan webinar.
• Secure funding. Funding options range from personal savings or money borrowed from friends and relatives, to bank loans and venture capitalist funding. Fully investigate your options.
• Market your product or service. If you have a big budget, there are endless marketing options available, from billboards to television advertising. But even small startups can gain visibility, thanks to the Internet, which is leveling the playing field. Building your website is key, but bolstering that with a presence on social networking sites—such as Facebook, Twitter, and LinkedIn—can generate even more buzz.
• Accounting Software. And, of course, [ =) ] you’ll need an accounting system software to help you keep track of your expenses.
Lastly, I would like to recommend everyone thinking about starting a business to go see the great people at SCORE (Service Corps of Retired Executives). They have been a tremendous support. They offer free business coaching, and they have local offices all over the United States!