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If you're interested in becoming an entrepreneur, you may be thinking, "I want to start a business. Where do I start?" When starting a business, many entrepreneurs will crowdsource others—friends, attorneys, accountants—for advice.
Planning to do the same? First, you have to ask yourself these important questions:
"What Type of Business Is Best for Me?"
A key decision is to determine the type of business you want to start. Most people will select one of three types: A corporation, a limited liability company (LLC), or a sole proprietorship. You can read about and compare these business types, and decide which is right for you.
"Can I Make a Profit?"
Every entrepreneur should ask this question up front. It will take a lot of research into production costs. If you find you can’t make money, then ask yourself, "If I reduced my costs or increased my price, can I make money?" Figure it out on paper first by making a cash flow spreadsheet.
You're also going to want to determine if you'll need investment money, and if so, how much you will need. Once you have this, one of the most important things that you can do for yourself is to create a business plan that will show all your research and present your plan for marketing your product or service.
"Do I Have the Money to Start a Business?"
By doing the above, you can determine if you have the money to start the business. Most businesses start out in the negative, so you really have to budget yourself. Not having enough startup money and proceeding anyway is why many businesses fail early and leave the entrepreneur with a big financial mess.
"What State Should I Incorporate In?"
Next, you have to determine in which state you want to incorporate your business. You can incorporate your business in any state that you would like. Generally, the two big choices are Delaware or your home state.
Your home state may be easier, but may offer pitfalls you will find out about later. Delaware is well-known for its excellent corporate law and efficient secretary of state’s office.
For 11 years in a row, the U.S. Chamber of Commerce has voted Delaware as having the best legal climate in the U.S. Delaware's Court of Chancery is run by judges, not juries, which typically results in fair business decisions and protection of the individuals behind the company.
"Where Should I Go to Start My Business?"
Typically, entrepreneurs will consult an attorney or an accountant, but you don’t need an attorney or an accountant to incorporate your business. Business formation is a relatively easy process and should cost you anywhere from $250 to $500.
Call us here at Harvard Business Services (800-345-2677). Since 1981, we have been helping entrepreneurs from all over the world form Delaware LLCs and corporations. We will guide you through the entire process from start to finish. We'll explain the difference between the LLC and corporation, discuss why a number of businesses incorporate in Delaware, walk you through how to form the company, help check the business name's availability, and take care of preparing and filing the Certificate of Formation/Incorporation with the State of Delaware. We make it easy for you.
It takes just a few minutes for us to gather all the information we need. We will have your company filed on the same day, and approved documents will be delivered to you in two to three business days via email.
We can also help you obtain your federal tax ID number (EIN), which is needed to conduct lawful business activities in the United States. (Think of it as a social security number for your business.) Once you obtain a federal tax ID number and have the Certificate of Formation, you can open a business bank account, hire employees, and open up an office.
With the right resources, starting a business is not complicated. When you have a company that wants to help you become successful, it's even easier.
When you’re ready to start your business, please reach out to us via phone (800-345-2677), email, or live chat. You can also form your company online with our easy-to-use order form. We always have friendly incorporation specialists standing by to help!
THE AUTHOR OF THIS BLOG ARTICLE IS NOT A LAWYER AND HARVARD BUSINESS SERVICES, INC. IS NOT A LAW FIRM. THE ARTICLE ABOVE IS NOT INTENDED AS LEGAL ADVICE AND SHOULD NOT BE TAKEN AS LEGAL ADVICE. THIS SHORT ARTICLE IS STRICTLY TO MENTION SOME ASPECTS OF DELAWARE’S CORPORATION LAWS AND/OR LAWS RELATING TO OTHER FORMS OF ENTITIES WHICH YOU MAY NOT BE FAMILIAR WITH. WE RECOMMEND THAT YOU CONSULT WITH A LAWYER BEFORE FORMULATING A STRATEGY WHICH WILL BE SUITABLE FOR YOUR SPECIFIC CASE.