It all starts with an idea. And that is where it usually ends as well. Anybody can come up with an idea, and most do, however acting upon it is another story. Yes, the idea of ketchup popsicles sounds enticing while you’re sitting on your couch watching football. Of course, everyone would want one.
Suddenly, as your friends chime in, details you hadn’t thought of start to surface. Do you have any experience in the ketchup popsicle business? Where will you get the money to start the company? Yada, yada. You already had your eyes on that house in the tropics when reality sets in. I can’t do this.
Yes, you can do this, but it will be much easier to conceptualize and not get bogged down if you organize your idea into a few simple steps. Like any big goal, if you start by breaking it down into smaller tasks, you’ll be able to tackle enough of the actions necessary to get started. Let’s take a look at a few that will get you going.
Create a One Page Business Plan: Yes, that is correct. Only one page. Even you can do this. Don’t fall into the trap that you must create a monolithic business plan to get going. The fact is, this will take time, you will never use it, and you don’t need it right now. It will be necessary for financing, but don’t tackle that here. Your money will most likely come from your savings, friends and family. One page can be posted and read daily as a vivid reminder of what you are trying to do.
Create a Budget: If you were told there would be no math involved, you were lied to. A modicum of financial knowledge will go a long way, and it is ubiquitous. You can even start with basic math knowledge and pencil and paper.
Learning Excel or another spreadsheet software would be a plus. It’s easy and you can find a ton of tutorials on YouTube. You should set up your business with profitability in mind the first 30 to 90 days. It’s possible. But have a budget reserve so you can survive if things go leaner than expected.
Determine Legal Entity: Okay. This is business 101. The easiest and least expensive way to get going is by becoming a sole proprietor. This is what 70% of small businesses are. However, the big catch is liability. You could be personally on the hook for things that go wrong, both financially and physically. An LLC is another alternative. In most states, it can be done online in less than 15 minutes at a cost of around $100. Test drive this legal entity for 3 to 6 months and see where your business is at. Then meet with an attorney and/or accountant to determine which legal entity is best for you.
Keep Business and Personal Funds Separate: This goes without saying, but many sole proprietors will co-mingle funds from the business with their personal finances. This can be both illegal and certainly make tax time more difficult. Don’t pay for an account or get any kind of credit lines yet, just get a holding place you can keep your money separated from your personal accounts. This should take you no more than an hour at the financial institution of your choice.
Like most things in life, the acronym KISS (Keep it Simple Stupid) applies as well to entrepreneurial start-ups. Don’t overthink it. Just do it.