A few small things can really help your business.
We've all heard the story -- an entrepreneur gets an idea for a product or service, drops out of school, asks family or bankers for money, and takes to the garage with gusto. There, they tinker with the secret sauce until it's fit to be sold to the masses and with a little luck -- voila -- it seems like yet another multi-billion dollar enterprise is born. However, as nice as these stories are, they always seem to leave out one important thing -- the business surrounding the business and how these people sell them. [gallery ids="18675,18678"] What do I mean by business around the business? I mean the accountants, lawyers, buyers, sales people, and marketing gurus that take that business from party balloon status and turn it into a technicolored, fire-breathing hot air balloon. Furthermore, there are a lot of people who are in the business of buying and selling businesses, like venture capitalists, who may make you an offer you can't refuse. So it goes without saying that focusing too much on your goods or service and not on your business's business could have its consequences. But that advice doesn't make for as good of a narrative.
So as I've researched starting a business, I've come across a few documents regarding what entity to file the business as, how to create a business plan, and plenty of advice on starting small. Then I came across this free business guide published courtesy of Doida Law -- a local Denver business law firm.
While it's not Zuckerberg's secret guide to becoming a billionaire before age 30, it certainly hit home:
Despite the numerous roles you may fill in the beginning, the details matter. If you’re in a situation where you’re juggling a lot of responsibilities make sure that you’re being a stickler for details. File taxes and licenses on time. Keep neat and organized files. Create digital backups on a daily or weekly basis. Make sure you have necessary hard copies of important files in a secure, yet accessible, area.It seems straightforward, but when I look back, I realize I've worked at small oil companies who've lost the confidence of their investors due to poor accounting and record keeping, despite successfully finding and producing oil. Not to mention, our compliance to local law was critical to continuing operation. Then, I continued reading and came across this:
If you can streamline processes and workflow to such a degree that employees and managers can function well in your absence, then it will be possible to continue smooth operations after you sell.I take it that the idea is that you want to structure your business to be a turn-key operation, and it makes sense. I think of it like choosing between a set of classic cars. Let's say that in one case there's been a lot of work done to the car -- it's got pretty paint and it comes with a litter of parts -- but it doesn't run. Yet it's up to you to make it run. The other, let's say, has a few scratches and a tear in the seat, but it really doesn't look that bad, and the thing roars when you fire it up. If I'm looking to cruise summer nights in Golden, which would I rather have? I think bankers would agree -- unless, of course, they're full-fledged restoration specialists. But people who are looking to buy up businesses to hold in a portfolio most likely aren't looking for a business restoration; they're looking for a turn-key vehicle to add to the fleet.
And that's not all of it. As for this guide, it's chock full of simple, straightforward advice that, in the information age, is hard to find. I think if there's anything we can all agree on, it's that healthy small businesses are a great thing!
So, cheers to Doida Law for saving entrepreneurs a lot of headaches (or even their business!) down the road. We know many of you out there have good things to say, so add your own tips for starting a business in the comments below!