Over the last 10 years, the US has been in what experts call a “startup slump” due to its weakened patent system. This system is supposed to protect young innovators from infringers, and when this happens, startups suffer and there are fewer opportunities left to create jobs.
But the good news is; 2018 could be the start of something new and positive for entrepreneurs.
The patent system is on its way to full recovery. Most startups begin with a product created and designed by an individual, and with the patent system getting stronger again, these startup founders will be protected from theft and predations of the baddies of the industry.
What’s more is that in 2017 alone, startups have managed to get a total of $148 billion in venture capital investments, which is the largest ever. So, it makes sense to say that the industry is growing steadily. And if you’re planning to start a business, now is the best time to do it.
Here’s how to start a business step by step.
What’s your type of business?
Do you plan to be a solo-preneur? Run the company with a partner? Incorporate it? Find out the pros and cons of each of these types of business structures to decide on which path to take.
If you ever choose to incorporate it or form a corporation, make sure to register it in the state where you live. It’s also advisable to hire an agent who will represent you well in the process, from submission of documents to registering your business.
Decide on your legal business name
Think of a business name that hasn’t been taken yet by another registered company to avoid infringement issues. Use Google search to look up business names that may be similar to yours, specifically those listed with the Secretary of the State.
Another option is to check with the US Patent and Trademark Office and see if your chosen name is still available for use.
Get a fictitious business name
Also known as Doing Business As (DBA), this step is recommended to solo proprietors and partnerships who want to file their company under a name that’s different from their own.
Obtain a Tax Identification Number
Go to the IRS to obtain your Federal TIN or Employer ID Number (EIN). The IRS will then be able to track your business transactions and help you stay on track of your tax obligations.
Find out more about business licenses and permits
Now, the requirements for getting those documentations may depend on several factors like your physical location and business structure. If you have an agent, this will be easy but if you don’t, your state may require you to obtain different licenses such as follows:
Build your business credit
Your personal and business credit line should be two separate entities. Otherwise, using your personal credit to run your company may affect your eligibility to apply for business loans.
Therefore, try to start building a business credit line by opening a bank account under your company’s name. Make sure that the regular cash flow in your account is good enough to increase your chances of getting a business loan approval.