There are countless lists online giving tips to new startup business owners. But who are these people offering the advice? What are their credentials? What businesses have they operated successfully? Have any of them sold businesses? How many have gone from Startup to IPO? In this article we’re providing great startup tips from business attorneys.
1. Start With A Business Plan
Though usually seen as a tool for selling the company, a well-written business plan is the best first step an aspiring entrepreneur can take to help ensure the long-term success of their new venture. The plan should include how the company will be funded, lay out a basic plan for growth, include goals through the first 3 years of business and also include an exit strategy for eventual sale or public distribution of shares of the company.
2. Find A Mentor
You’ve heard the old adage that experience is the best teacher? Well it’s only half right. OTHER PEOPLE’s experience is the best teacher. Pair up with someone in a similar industry who has already gone down this road. Learn from them the mistakes they wish they could have avoided and find out where the highest unanticipated costs were found.
A strong financial backer can make or break a startup. Funding a company with your own money may seem like the best way to hold onto what you are building, but you’ll operate at a higher financial risk. Being well funded will get you through your first year of business, after which you’ll hopefully have a strong portfolio for the business to run itself from.
4. Stack The Deck
Everyone on your team has strengths and weaknesses. Play to the strengths and find someone else to fill in the gaps. If you’re running a construction company and your drywall guy really hates to paint the wall he just put up, don’t ask him to do it. Find someone who loves to paint and you’ll have a higher quality product at the end of the day. The same methodology applies to you, the owner. If you are a fantastic sales person but terrible at accounting, stay out of the books and hire a bookkeeper.
5. Put Up A Finish Line
Set goals for everything you do. These goals should have deadlines and missing these deadlines should have consequences. If you leave everything open ended your chances of succeeding will dwindle. Likewise setup rewards for when you hit your goals on time and better rewards for when you finish up ahead of time.
6. Inc. or LLC
The type of corporation you set up is really up to you. Depending on your needs and the needs of your partners and investors, each business type has its advantages and disadvantages. Speak with your local business attorney to find out what will work best for you both in the short-term and in the long-run.
7. Garage Inc.
Where you decide to setup your startup may play a bigger role than you think. While working out of your garage may be the only way to go you will probably have a more difficult time attracting top talent to help you in your new venture. The recent downturn in the housing market has led to office space dropping in price. You may be able to find something that fits your needs at a great discount.
This article was written in cooperation with Murphy, Ellis & Weldon, PLLC