Establishing + Legitimizing Your Small Business

Sep 3, 2021 | Blog, Business Education

Though this blog is mainly dedicated to my personality, craft, and work, I do run a small business, and many of you have expressed interest in how to approach it. So, today’s post features my first business education share + free download.

I am not business consultant or business education expert, but I do have one—and she’s great! To my credit, I did the work to establish my own business and continue to do the work to grow and sustain it. That said, I met my five-figure revenue goal the year months ago and I just celebrated adding myself to my payroll to draw a monthly salary. I have also completed each task on this list and hired all three professionals I advise on. So, I know just more than a little bit through experience {not expertise.}

Most times when others share advice on how to do something the practical 1-2-3 steps are absent leaving interested persons with the aching question: But how do I actually get started? I’m glad you asked!

Prepare yourself for six pieces of data—3 tasks you need to do and 3 professionals you should first seek to hire or consult when establishing AND legitimizing your business.

3 Tasks to Establish + Legitimize Your Business

  1. Apply for an EIN/LLC.

You can do this on your own, hire a lawyer, or choose a registered agent {RA}. The RA is usually the best “middleman” where you do not have to manage the filing on your own while also not spending as much as you would on an attorney. There are some other business owner/compliance perks that RAs offer making the decision to choose one more than worth it. There is some organizational and tax strategy behind creating an LLC {Limited Liability Company} that you may want to benefit from before you pull the trigger. Apply for an EIN {Employer Identification Number} directly with the IRS {Internal Revenue Service}. The application is painless and usually your number is created for you within minutes. This number will function like the “social security number” for your business.

2. Open a business bank account.

Technically speaking, a business isn’t even a business without these first two. Do you know how many people are running a “business” that are indeed professional hobbies at best? If a major corporation, non-profit organization, and/or the government wanted to pay you for your professional services, they are not usually sending payment in your first and last name to your personal account or CashApp. Many lucrative opportunities and partnerships are available to you when you run your business like a business. If you’re just getting started and need to preserve as much capital as you can, I recommend a free, digital bank not named PayPal. Can you have a PayPal account? Yes. Can that be the only online bank you use for income and expenses? No. Below are three online banks that are effective options for newbies.

Before we survey banks, there are two features you want to make sure your bank service includes: sub-accounts and team collaboration. Sub-accounts are important to have when entering the freelance/startup/small business space. There is strategy behind not just generating sales and revenue, but also bottom-line profit. Banks that allow sub-accounts makes it possible for you to realize a profit from the beginning. More on that later. For now, choose a digital bank that offers sub-accounts {also called “envelopes” or “buckets”.} You should not be the only one monitoring and assessing your money. As such, the ability to add team members {with limited access of course} to your account will easily help you with reports, filings, and final money/service decisions.

RelayFi – Offers no-fee banking for small businesses. It is designed for growing businesses and easy team collaboration.

NorthOne – Offers digital banking service for freelancers and startups who want banking services designed for them. It includes extended customer service hours and a top-notch user interface, but at a cost. There is an un-waivable monthly fee.

Lili – Offers a free checking account designed just for freelancers—and it delivers hard. It is designed for you to be successful as you can be with the least amount of headache. Note that support hours a few so this wouldn’t be for you if you need frequent hands-on assistance.

Side Bar: Please keep your personal and business monies separate from each other. Co-mingling these funds and/or accounts is not only confusing but also makes you vulnerable to legalities and penalties that are best to avoid. My favorite legal education attorney is Michelle Wilson. Her site hosts great content for new and small business owners. She even has affordable resources to purchase that provide effective documents {like contracts} and support.

3. Design a website using WordPress {WP}—heavy on the WP–with a suite of professional emails.

You will have to choose between .org and .com. I would recommend .org. In total transparency, this is probably the most difficult and time-consuming task; but its payoff is worthwhile. Your business needs a {digital} address. Unless you have built a major following using another platform, this is the life of your business. Some business educators would argue that even with that major following, your business is more credible when it lives somewhere. You know how it takes an address to accept gainful employment? Likewise, it takes an address to engage in honest business. Potential customers trust your business more when it has a “house”—and more so when they know exactly how to get there.

While most of us love Gmail, please create a professional email account with your business/website’s name in the handle. For example, if you want to ask me a question about the live courses that I teach, you can do so at courses@professorjoyice.com. Business ownership is just that—ownership. If you’d like customers and other professionals/colleagues to take your business ownership seriously demonstrate that you own your business, not Gmail.

To own a website, you will need a host; and that host will also create your emails. There a many host options to choose from though my two favorites are now Siteground and BlueHost.

Side Bar: Decide how you will approach tech in your business. If you are not back-end savvy it may be worth your while to hire someone to run your site and give you tech assistance.

Whatever product or service offerings you provide, please integrate a payment processor that allows you to collect payment and is a smooth transactional experience for your customers. Google to survey your options, though Stripe and Square are highly popular.

Side Bar: Ensure that your website has both a terms of use/service and a privacy policy. Ask your lawyer about why this is important and what this specifically means for your business.

3 Professionals to Hire in Establishing + Legitimizing Your Business

Now that I have listed the 3 main tasks, let’s transition to the 3 professionals you’ll want to hire. You may not be able to hire all three at once, and that’s okay. But you want to grow your business so that you can make these hires, and these are the first three professionals to onboard. Also, though professional consults do cost money, they are much cheaper than hires. Depending on your specific situation, you may be able to establish your humble beginnings with consultations instead of direct hires.

  • Hire your bookkeeper. This professional will support you with your day-to-day business income and expenses. {King Crown Financials provide excellent bookkeeping services, if you’re interested.}

  • Hire {or consult with} your attorney. This professional will support you with legal compliance in your business, and when beginning your business, they can assist you with your filings and legal website language. If you are in D.C. and need an intellectual property attorney, I am willing to refer you.

  • Hire {or consult with} your accountant. This professional will support you with more long-term business income and expenses. They are also integral with tax strategy and business filings. I mentioned creating an LLC above because many new small businesses begin there but there may be other factors to consider where an LLC is not the desired option or no longer the desired option. You accountant can assist you with the decision.

If you have any personal questions, please shoot me an email. I can usually point you in the right direction of where you need to start and/or who you need to speak to.

Finally, do not attempt to approach this list all at once. I numbered each step on purpose. Slow and steady wins the race here. Do what you can when you can—sustainable businesses are not created overnight. I will give you some time to get the ball rolling. Then, I’ll post again to share three books you want to read as you launch or establish your business.  Until then, download my Minding My Business Checklists. Trust me, as you create new accounts to run your business, having all this info handy in one area is very helpful.

Love, Light, & Business


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