This new company “checklist” assumes a lot of things, so please don’t consider it a complete document by any stretch of the imagination.  It is simply a starting point.  The idea of this post is to take my lessons learned from starting three companies and helping countless others with their new ventures over the years and help you get your company off the ground and hopefully help you avoid some of the headaches that will invariably arise. 

Step 1:  Before you begin

Business Plan: 

There is so much to think about here that I’ll just say that if you haven’t gotten this far, stop go back and figure it out.  You will adjust your business plan on a monthly basis as you go along, but you need a “North star” to navigate by.   If you ever want/need partners, investors or buyers having your business plan will help facilitate the conversation.  Remember - this isn’t a “What is your mission? “ question, this is the “How we intend on reaching our goals” conversation.

Peers:

Find a peer / mentor group and use them to refine ideas.  The people I find myself talking with are usually way more experienced than I am in one or more areas.  I appreciate all perspectives.  I don’t always follow their advice but I always consider it.  Some lessons you need to learn yourself and other situations it is better to learn from others.  Wisdom comes in learning the difference.  

Constant Contact:

Open doors and keep them open. I’ve learned that most people genuinely care about my success and not only because it benefits them.  People love to help.   Many of the conversations I have come from professional relationships 10+ years old, but I try to find new perspectives all the time.  I’m open to engaging in dialogue with anyone!  I’m not smart enough to know it all, but I’m always eager to learn more.  I’d rather talk with my peers/mentors than eat or sleep.  It is always invigorating!

Step 2:  Just getting “warmed: up

Company Formation:

I used the “company corporation” to help me set us and register my LLC.    The act as the “Registered Agent” and handle most of the paperwork.  They send me a bill or something to sign and the deal with everything else.  It helps keep a legal separation between my business entity and myself.  If you plan on having any outside investment then consider a C corp, if it is only going to be you or you and a small team, then LLC may be the way to go.   You’ll wind up with a Certification or Filing certifing your Certificate of Formation. This basically says that you’re now a legal business entity in the state you registered in.

Insurance:

Insurance is a pain, but required if you plan to work for larger companies.  Find a local business insurance broker to help you find the right coverage.   Usually larger corps require worker’s compensation, comprehensive general liability, products liability, errors and omissions, and automobile insurance  - usually the limits are set at $1 million per occurrence and $2 million in the aggregate for all claims or at least they will accept those levels if their stated requirements are higher. 

The broker can then help you generate certificates of coverage to present to each company you support as part of the contract set-up.

The moment insurance people hear “information security” they freak out and decline coverage so it took our broker some effort to find us coverage.  Best to find someone in your local area (at least in the state you are in or in the state where your company is registered).

 Step 3:  Here we go!

Marketing: 

Spend time on a consistent basis to think about marketing your company.  Your corporate brand is everything.  Use the free tools you have (friends, facebook, linkedin, twitter, etc) extensively.

Get out of your house and away from clients once in a while.  You need to attend conferences (Speaking, Sponsoring, Attendance) to drum up new relationships and partnerships.  Obvious stuff:  Logo, Business Cards, Stickers, Shirts, Podcast, Blog, Advertising (Adwords, etc) – Invest in your brand.  Protect your brand. 

Another lesson learned:  Talk with industry and financial analysts, not for coverage but to share expertise, you’ll learn something new with every conversation!

Trademark: 

Go ahead and start your trademark claim on your company name and any other relevant information (product names, etc).  It is about $350-$500 per trademark/servicemark and it can take up to 12-24 months to process completely.

Legal:

Legal Support: Get a lawyer on retainer.  Remember the lowest paid lawyer, every time.  Find help. 

Legal Documents:  As a small company most of the time you’ll wind up using a partner or customer SOW templates, but you should have your own available.  The same is true with NDA and Mutual NDA.  Write one up - hundreds of templates exist and have a lawyer review it so you know what to look for in other documents before you sign them.

Note: Remember most terms and conditions can be changed if you don’t like them, don’t forget to ask for changes if you think the terms are too onerous on you.

Local registration: 

One thing I almost overlooked was local registration.  You need to register with your state, county, city and pay business taxes to each (usually very inexpensive).  We also had to register in each state where we have employees (just keep that in mind as you grow).  As you start paying employees in other states be sure you have an accountant or outsourced financial person to deal with local taxes / unemployment, etc.  It takes up a lot of time and you will get behind on serving your customers if you’re spending time dealing with this.

Sales and Support

Sales: You need to think through your sales strategy.  Are you going to partner with technology firms, consulting firms, VAR’s?  How will you let them know about your services?  You will spend a great deal of time in this area.  My advice is to be yourself, use your strengths.  I’m not an extroverted person, but I’m not shy about asking for what I want and offering ways to help people.   I’m honestly honored that people trust me to help them – it isn’t an “approach” it is sincerity.  Others have more success with other methods. 

Make your life easier.  “SKU” your offerings.  Create a name, description, pricing and detailed offering sheets for each of your offerings.  It will help you with your direct customers and to sell through partners.  The easier you can make things on the sales person the better off everyone involved will be. 

Support:  How will you support your customers?  You can’t be 24/7 don’t even try.  Set expectations accordingly, provide them resources to help, but don’t kill yourself.  Online support systems may work better than email/phone.

On the flip side You will find yourself needing support at somepoint, perhaps to scale, or to deliver regionally, or with an “expert” service, find partners you can trust to help deliver on your Brand. 

CRM:  I have used spreadsheets, custom apps and Salesforce.com (SFDC) to help with CRM and other things.  There are some lower costs solutions out there now, but you need to manage your sales pipeline, customer relationships, support inquiries carefully.  Invest in that process your customers will notice.

Step 4: Off and Running  Business Operations:

IT infrastructure:  I’ve used Google Apps for email and calendar.  Having Postini for free wasn’t ever a bad thing.  I’ve been happy 99% of the time.   If it is sensitive then I use PGP.  Having a Mozy account is a good idea as well!

IT Assets:  Smartphone , Laptop(s),  Server, Local Storage, Office Phone, Podcasting Equipment, Software (OS, VM, Office, Web, Video/Sound Editing, etc) you can easily drop 10K or more on this side of the house.  Plan carefully.  I’ve been a Mac shop for years.  Makes my life much easier for what I do, but it is very expensive.  Have back-ups of your back-ups.  I have two laptops because it takes too long to get the first one repaired when things do go south. 

Communications:  Google Voice, Your Business Internet Provider, Vonage, etc a lot of inexpensive “office” phone options exist.  Use them.

Internet:  Get business class Internet at your home.  Higher speeds, dedicated IP and most importantly when your holiday decorations blow up and your modem is one of the casualties you’ll appreciate them coming out at 2AM to replace it.  

Office:  If you find yourself unable to work at home or needing office space to meet with clients in person then check out Regus.  For somewhere between 300-500 a month and you get a Virtual Office - professional human answering service, access of office locations, mailing address at some great locations and top-notch facilities for hosting meetings.   Worth every penny if you need to physically meet with people fairly often, otherwise work from home or client locations.

 Timecards:  Some customers will require you to have a timecard solution.  Over an above what you put on your invoice (if you bill T&M).  Certainly once you have employee’s you’ll need a better way to deal with it than your calendar.  We found that Intuit had a web-based solution that integrated with our Quickbooks solution very easily. 

Expense Tracking:  For expense tracking we use a combination of dedicated AMEX cards and neat receipts.    Travel through E-gencia or Amex also helps keep everything is an easy place to find it later.

Lab systems: For Lab servers I use a combination of Amazon EC2, Go-Grid and Mosso.   I have a home lab set up as well but for collaboration with others a hosted solution makes more sense, especially if you are on the road. 

Web Presence:  DNS/Blog/Website hosting are trivial, but important.  Search around for options.  Squarespace was recently mentioned to me and for most it seems really simply and effective.  I’m using it now for Visible Risk.

Telecommuting and Collaboration:  Webex is a wonderful thing - get an account.   It comes with Teleconference Bridge.  Use it and avoid travel when you can.   There are other options, at lower costs now and you should evaluate them, but pick something.  You don’t want to use your customer’s bridges all the time.

Finances:  Stay Organized.

Accountant:  Find and accountant and use him/her.  By far my biggest error to date was to think I could run a business, support clients, deal with legal, marketing, contracting, sales, manage/mentor people, have the family life I want and do the corporate finances.    Prioritize.

Banking:

I’d prefer to find a local bank but with 100+ bank failures a year I think I’ll stick to the main ones.  Do your homework here.  Bank fees for small business accounts can be outrageous.  Also of note, cashing physical checks or paying bills takes an absurdly long time with business accounts.  Plan ahead.

Have at least two (2) Accounts.  One for accounts receivable and one for expenses and if you grow have a separate account for employee payroll.  It will make your life much easier in the end.  Most banks will give you a free secondary checking and also will provide a savings account.  Some banks will offer your employees free personal accounts, but at the same time may charge you a transaction fee every time you want to transfer money to an outside bank. 

Merchant Processing:  If you want to accept forms of payment other than purchase order (Credit Card, EFT, etc) you’ll need to figure out a way to process those transactions.  If you need to manage subscriptions you’ll need even more flexibility.  Paypal, Authorize.net, Google Payments, Your Bank – there are a lot of options each with their own cost to benefit ratio.  For me I’d prefer not to deal with credit card numbers directly. 

Financial Applications  Quickbooks is great, expensive and a beast to mess with, but it is solid.  Many banks actually offer online invoicing and help facilitate collection and they all will integrate and/or replace existing financial applications (Quickbooks, etc) so look at them carefully.   My advice here is to talk to you business accountant and see what he/she prefers.   QuickBooks is an easy way to track your time and invoice your customers, but honestly you may want to find someone to help you with that stuff.  You can’t work on the business and in it at the same time.  If you do it yourself, schedule focused time on a recurring basis!

IRS:  As a single person LLC you may not need a separate IRS number but it doesn’t hurt to get one Federal EIN is what it is called. It is easy form and process and it only takes a few days to set up.  It facilitates with some later steps and sets you up for growth.  Find a good accountant and manage your expense tracking carefully.  Quarterly statements are almost always required.  Get assistance!

 Employee Benefits:  Once we added employees we also added health, vision, dental insurance as a benefit for our employees – In many cases you’ll need 4 as a minimum to get that process started.   Very expensive endeavor but worth every bit of it to keep your employee’s happy!

Step 5:  Government Contracting

DUNS:  Duns and Broadstreet Number (DNB) http://smallbusiness.dnb.com/ – it is a credit measuring system for Business.  Equifax/Experian also have business credit monitoring tools.  You should manage your business credit as carefully than your personal credit.  D&B Duns number is critical for registration in Federal systems for contracting.  It is free to register.  Monitoring/alerting/updating are offered as services at a premium.

CCR:  Central Contracting Registration https://www.bpn.gov/ccr/default.aspx Get your company listed to be able to support federal government.  Your state, county and city probably also have vendor registration systems you may want to enroll your company in. As you register you’ll need your DUNS, Bank Account Info and contact information for your company (Hint: set up “information” or “government” mailboxes to help you process email from 3^rd parties that will occur as a result of your registration).  You’ll notice that once your registered in CCR you’ll have opportunities to register with some of the larger Defense Contractors as subcontracting vendors as well.  I suggest you do so; they have a great need for qualified subs/partners.

SBA: While not exclusively a government contracting thing, I grouped it here because of the way I originally intended to use the SBA.  The SBA has local resources that can help you along the way.  I was hoping for a SBA loan or for 8a registration.  What I learned about both is that your company really needs a two-year track record before those resources become available.  There are other benefits of the SBA, mentoring, introductions, etc.  Take advantage of it!

ORCA: (online Reps and Certs): If you want to bid on contracts you’ll want to spend some time in this system to save you headaches later.  You have to be registered in CCR first.

Subcontracts:  In order to get into government contracting more than likely you’ll need to subcontract with a larger contractor or vendor.  This isn’t nearly as hard as it sounds.  Each of them have small business development teams listed on their website.  Register with them and reach out.  Personal introductions work better to reduce time and effort so reach out to your network to help make connections!

Two Final Notes: 

Focus on your Customer:  I firmly beleive that by taking care of my customers the business will take care of itself.  Obviously there is a lot to do, but get help on things that are “core” to the business of supporting your customers and your life will be much better!

Support and Balance. Nothing I’ve done over my career would be possible or even remotely fun if it weren’t for my family, friends, colleagues and customers supporting me every step of the way.  Appreciate them and spend time with them.  Mentor, Learn, Share, Love.  In the end you need to love what you are doing in order to be able to help anyone.  Prioritize correctly and give 100% in all areas, not just one. 

Thank you for reading!