Do you know the difference between a business venture and a business adventure? Both are risky, but adventures are bold and exciting! Starting a new business is one of the most exciting and challenging journeys one sets off on in a lifetime. In 28 years of practicing law, I’ve seen many individuals start business adventures, and succeed beyond their wildest imaginations, while others have shown me what NOT to do when getting started. There is no greater challenge or greater joy than boldly setting out on your own. However, as with any adventure, the guide(s) and resources you utilize will determine your success or failure. So before you start off on your new business adventure, make sure you have the following:
Passion: Are you passionate about your business idea? If your idea does not excite and drive you, then don’t do it. You have to have -confidence in your idea, drive, and determination to persevere through the challenges that lie ahead.
Competence: Do you have expertise, or can you afford to hire individuals with the talents you need in the area you want to start your business?
Support: Do you have the buy in of your family and friends? Do your spouse, kids, siblings, parents and good friends believe in you and your new venture? Will they support you, encourage you and cheer you on?
Counsel: Have you sought wise counsel from other successful businessmen in the same industry, mentors, and elders in your community? No question is too dumb.
Business Plan and Capital: Have you planned your first 12 months and do you have enough capital to get things off and rolling? Underestimate your revenue and overestimate the expenses. You will find it tight, but you must have goals! Without a vision, you will perish. Planning gives you a map that you can adjust as you move forward.
Risk Tolerance: Even the best new businesses have risks. You will never make money without taking some risks. If you have successfully made it through the first six (6) questions, then, have faith in God, yourself and those behind you, and go for it!
Asset Protection: Find a good business attorney to help you form your business structure. Depending on your type of business, an attorney will usually recommend incorporating or forming a limited liability company to insulate and protect your personal assets.
Buy-sell agreement: This section only applies if you have partners. If you do, then you must have a buy sell agreement in place in case one of you wants to leave or passes away. If a partner passes without a buy-sell agreement, you will then be in business with his/her spouse or the beneficiary of his or her Will.
Certified Public Accountant: Our government and taxes shut down more businesses than you will ever believe. Immediately, get a Certified Public Accountant (not a bookkeeper) on your team. They will save you money, and heartache and keep you headed to great success!
Insurance, Licenses and Permits: Depending on your business, you will need various types of insurance, licenses, and permits. Ask your Attorney and CPA to guide you through the red tape – otherwise you could break the law unwittingly, get sued and not be covered, or worse.
The difficult challenges of starting a new business venture and great joys of succeeding are like no other in the world. Pack your bags carefully, good luck and Godspeed on your exciting journey!
