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Startups are businesses that are created with the intention of experiencing rapid growth and disrupting their industry. If you possess qualities such as self-motivation, passion, creativity, adaptability, and have a great idea, you may be well-suited for entrepreneurship.

Our comprehensive guide provides step-by-step instructions on launching a business, covering everything from business planning to marketing. It offers valuable tips and strategies for entrepreneurs aiming to achieve success.

Evaluate your entrepreneurial abilities.

Launching a startup requires a strong mindset and determination.

Starting and growing a business requires dedication while launching a startup company requires even more dedication.

There are various types of entrepreneurs, and they tend to display common characteristics such as passion, creativity, motivation, and self-discipline. Additionally, entrepreneurs must possess adaptability, observation skills, and a willingness to take risks.

Other commonly attributed characteristics of entrepreneurs include:

• Passion
• Creativity
• Motivation
• Self-discipline
• Adaptable
• Observant
• Willing to take risks

Having a deep understanding of the industry's issues and obstacles gained through industry experience can provide you and your startup with a competitive advantage. However, not all startup CEOs possess a technical background or relevant experience. Numerous successful entrepreneurs possess the necessary vision and foundational skills to lead a company and choose to hire qualified professionals to compensate for any skill gaps.

Please listen to our latest founder interview to gain more insights on the process of launching your own startup.

Discover strategies to develop your startup idea.

When searching for startup ideas, it is recommended to start by exploring your existing knowledge. However, it is important to note that your current skill set is not a limitation. Many non-technical individuals have successfully founded tech startups.

Startup ideas commonly originate from the process of problem-solving. These problems could either be personal challenges or ones that have been recognized as needing different solutions. By basing your startup's product or service around a specific problem, you can not only create an MVP but also identify your target market prior to beginning your venture.

Examine the industry landscape and formulate your idea.

Prior to launching a startup, it is important to analyze the state of the industry landscape, which includes considering the following factors:

• Funding environment
• Market size
• Competitive landscape
• Market structure
• Market size and demographics
• Projected growth

The purpose of this is to determine if there are enough opportunities in the industry to support your entrepreneurial goals. You can gain a more in-depth understanding by reading our detailed guide on conducting market research.

Validate Your Idea

After gaining a general understanding of your specific field, competitors, and the projected growth of the market, the next logical progression is to validate your startup idea and establish your minimum viable product (MVP).

There are several methods to validate your idea.

• Conduct interviews with potential customers to gather insights that could help refine the unique value proposition (UVP) or target audience, if needed.
• Utilize available tools and software to explore, analyze, and gain insights from industry and market data. Some commonly used tools include Statistica, Think With Google, and KNIME.
• Entrepreneurs often utilize startup incubators or accelerators to connect with other entrepreneurs and receive valuable support and feedback to refine their startup ideas. They also explore online startup communities to foster collaboration and knowledge sharing.
• The establishment of product-market fit and market validation is necessary.

Develop a roadmap for your startup.

Writing a business plan, whether it's informal or formal, involves considering key elements of your business such as industry, market, and competitive position.

There are various types of business plans available, which are determined by the stage of your venture and the purpose of your business plan. In the initial stages of your business idea, you may consider beginning with an informal business plan.

• The business model canvas is a visual representation of the important components of your business, such as customers, value proposition, infrastructure, revenue models, and cost models.
• The Lean canvas is a modified version of the business model canvas that allows for visual representation of your problem, solution, customers, value proposition, key performance indicators, and competitive advantage.

When you are prepared to seek investments, it is typical to be asked for a formal business plan by lenders and potential investors.

Create a Pitch Deck

Before securing funding as an early-stage startup, certain prerequisites must be met to increase the chances of a successful pitch, regardless of whether it is directed towards angel investors or a small business loan. The most critical requirement is the development of a pitch deck. Crafting a compelling narrative is crucial not only for the success of the startup itself but also for the creation of an impactful pitch deck.

A startup's pitch deck typically includes the following elements.

• A brief overview of our startup company.
• Our startup aims to address various problems and challenges.
• Our product or service provides solutions for a variety of needs.
• The market and opportunity are of significant size.
• A concise explanation of the product or service offered by your startup.
• The outline includes the projected growth, major goals, and future steps.
• An introduction to the core members of your team.
• Identify your competitors and determine your competitive advantage.
• Demonstrate your proficiency in financial planning and management.
• This document outlines the allocation and purpose of investment funds and the rationale for their necessity.

Establish a founding team.

Find Co-Founders

According to research, startups with two founders have a 19% lower likelihood of scaling prematurely compared to startups with a solo founder. Additionally, aspiring entrepreneurs who launch a startup without a cofounder typically take 3.6 times longer to achieve significant growth, enough to surpass the startup stage.

While it is true that not all startup owners require a co-founder to achieve success in their startup endeavors, the inclusion of co-founders can help address vital gaps and fulfill the company's requirements.

• Skills gaps
• Leadership experience
• Industry Knowledge gaps
• Startup experience
• Fundraising experience
• Personality gaps

If you decide to bring on a co-founder, it is important to have a founders' agreement. This document details expectations both now and in the future.

If necessary, consider hiring a lawyer.

The next step is to learn how to find a competent lawyer for your startup. A lawyer is crucial for ensuring that your startup is legally established smoothly and can assist in maintaining compliance if you plan to implement customized vesting schedules or share allocations.

Network Network Network

Networking is a valuable tool for startup entrepreneurs to cultivate and sustain their businesses, with numerous resources available such as startup incubators, networking events, and local entrepreneur communities to facilitate connections.

To develop an effective networking strategy, it is important to connect with a diverse range of people, including:

• Fellow entrepreneurs or founders
• Advisors ormentors
• Potential customers
• Industry Leaders
• Investors (e.g.,venture capitalistsorangel investors)
• Individuals from the local startup community.
• Training programs
• Hackerspaces andmakerspaces
• Online communities

Formally establish your startup.

Name Your Startup

Choosing the name for your startup requires careful consideration and will depend on factors such as the nature of your business, industry, and target audience.

After selecting a name, it is necessary to check if the name is already in use and if the domain name is available. This can be done by conducting web searches, checking Federal Trademark Records, and examining the website of your state's Secretary of State or equivalent department.

One can also use GoDaddy to search for available domain names.

Find a Domain Now

If the desired name is already taken, an alternative must be chosen. In case of difficulty in generating a new name, there are several tools available that can be helpful.

1. Namecheap: Namecheap offers a domain name search tool that suggests available domain names and variations based on your input.
2. DomainWheel: DomainWheel generates domain name ideas by combining keywords and providing available domain suggestions.
3. Lean Domain Search: This tool generates domain name ideas by pairing your keyword with other words and checking domain availability.
4. Panabee: Panabee suggests domain name alternatives and variations, checks availability across multiple domain extensions, and provides related terms and availability status.
5. Bust a Name: It combines keywords, creates variations, and checks domain availability, helping you find unique domain names.
6. NameMesh: NameMesh generates domain name ideas by combining words, providing available domain suggestions, and categorizing them based on availability.
7. Domainr: Domainr offers domain name suggestions, including unavailable names and alternative domain extensions, to help find creative and available options.

These tools can aid in brainstorming and discovering available domain names or variations, ensuring you find a suitable name for your website or business.

Choose a Business Structure

One of the preliminary steps in establishing a startup as a legitimate business is selecting a business structure, which refers to the legal form of the startup.

These are the primary legal structures for startup ventures.

• The legal structures of sole proprietorships and general partnerships are considered informal, where the startup is seen as an extension of the owners, and the owners are responsible for the tax and liability burdens of the business.
• Limited liability companies (LLCs) and corporations are two common types of formal business structures. These legal structures require registering the business with the state as a separate entity. By operating as independent entities, these structures offer liability protection for owners and specific tax advantages for the business.

The legal structure of your startup is influenced by various factors, including:

• Whether you are starting a business by yourself or with partners
• The stage and growth plans of the venture are being discussed.

The most common corporate structure for startups aiming for significant growth is the C corporation. This is due to the preference of most investors for C corporations. C corporations offer favorable taxation rules for investors, easy ownership transfers, and natural exit strategies. Additionally, many angel investors and venture capitalists require ventures to be incorporated before investing.

To learn more about establishing your business as a formal legal entity, we recommend reading our comprehensive guide titled "How to Incorporate a Startup."

Are you considering using an incorporation service?

Choosing to hire a professional service can streamline the process of company formation for you. It saves time, ensures compliance with legal requirements, and provides expert guidance throughout the incorporation process.

Best Incorporation Services:

1. Incfile: Known for its affordability and user-friendly platform, Incfile offers various incorporation packages and additional business services.
2. LegalZoom: A widely recognized service, LegalZoom provides comprehensive legal support, including business formation, legal document creation, and ongoing compliance.
3. Rocket Lawyer: Offering customizable legal documents and services, Rocket Lawyer assists with incorporation, contracts, and ongoing legal advice.
4. Northwest Registered Agent: Known for its personalized customer support and compliance services, Northwest Registered Agent offers reliable incorporation solutions.
5. ZenBusiness: An ideal choice for small businesses, ZenBusiness provides affordable packages, ongoing support, and compliance assistance for new businesses.

Consider your specific business needs, budget, and desired level of support when selecting an incorporation service to ensure a smooth and efficient company formation process."

Choose a Location

While some locations like Silicon Valley have become well-known for their startup culture, it is generally more ideal to start your business in the state where you are already located. Doing so avoids the need for complex paperwork and tax requirements that come with starting a business in a different state. However, if you are considering starting your startup in another state, it is important to note that some states offer more favorable conditions for businesses than others.

Founders often choose Delaware as the state for incorporating their startups because of its business-friendly policies. Startups in Delaware can operate in other states and avoid state income taxes, which is a significant tax advantage. However, not all states offer the same benefits. It is advisable to consult with a tax professional or attorney before expanding your business to another state.

Select your state from the provided list to learn more about starting a startup in your specific state.

• Alabama
• Alaska
• Arizona
• Arkansas
• California
• Colorado
• Connecticut
• Delaware
• Florida
• Georgia
• Hawaii
• Idaho
• Illinois
• Indiana
• Iowa
• Kansas
• Kentucky
• Louisiana
• Maine
• Maryland
• Massachusetts
• Michigan
• Minnesota
• Mississippi
• Missouri
• Montana
• Nebraska
• Nevada
• New Hampshire
• New Jersey
• New Mexico
• New York
• North Carolina
• North Dakota
• Ohio
• Oklahoma
• Oregon
• Pennsylvania
• Rhode Island
• South Carolina
• South Dakota
• Tennessee
• Texas
• Utah
• Vermont
• Virginia
• Washington
• Washington D.C.
• West Virginia
• Wisconsin
• Wyoming

Once you have selected a physical location for your startup and have a good understanding of the laws, regulations, and potential benefits of the state you will be residing in, you can begin searching for office space. This guide will assist you in choosing the appropriate office space for your startup based on its stage, requirements, and the various types of office spaces available.

If your startup is primarily operated online, particularly for ecommerce purposes, your business website serves as a crucial aspect of your company's operations. If you do not currently possess a website, it is advisable to contemplate its construction or subcontracting its creation. 

Please create a Founder Employment Agreement and Vesting Agreement.

Startup owners are usually not subject to severance agreements that would apply to other employees. Instead, founder employment agreements serve as the legal agreement between the founder and the company.

A vesting agreement is a contract between a company and a shareholder, usually an employee, that imposes limitations on the shareholder's ownership of the company. Essentially, the employee will only receive their share once they meet the vesting requirements.

Formalize Advisory Agreement

If your startup decides to engage startup advisors and equity is part of the collaboration, it will be necessary to establish an advisory agreement. This agreement will clearly outline the expectations and provisions of the partnership between your company and the advisor, including terms related to equity allocation and confidentiality.

Startup advisors can provide valuable assistance during the early stages of startup ownership, particularly if you lack confidence in specific areas of business ownership, such as legal and compliance requirements, marketing, or manufacturing.

If you are seeking startup advisors, investors, such as venture capitalists or angel investors, are often excellent options for high-scale startups. However, for businesses with different growth goals, resources such as SCORE or the Small Business Development Center (SBDC) in your area can help you find startup advisors.

Create a capitalization table and issue shares/certificates.

A capitalization table, also known as a cap table, is a document, typically a spreadsheet, that provides a detailed summary of the equity capitalization of a startup company. The cap table includes information about the securities, such as stocks, warrants, and certificates, held by individuals or entities, and specifies the ownership percentage associated with each.

Next, shares or certificates of your company will be issued to each party according to the cap table that has been created.

Establish Corporate Governance

Corporate governance refers to the rules, regulations, and principles that govern a company. It provides structure to help the startup achieve its goals and objectives, while also addressing the needs of shareholders, employees, and the community.

Appoint a Registered Agent

A registered agent is a necessary and legally required individual or entity that receives important documents and legal communications for your startup. In order to form a corporation or LLC, most states mandate that every business designates a registered agent.

It is advised to consider hiring a professional registered agent service to ensure compliance with the law and for added peace of mind.

Complete the registration process for your business with the IRS.

It is advised to register your business with the IRS, which involves obtaining an Employer Identification Number (EIN). This number is used by the IRS to identify businesses.

There are various reasons why an EIN may be necessary for your business.

• EINs are necessary for various business structures, including corporations, partnerships, and multi-member LLCs.
• EINs are necessary if there are any employees.
• Typically, banks will require an EIN in order to open a business bank account.

Please register your business for sales tax.

Depending on the circumstances, it may be necessary to collect a sales tax based on the type of product or service provided and the jurisdiction in which one resides.

Sales tax, also known as "Sales and Use Tax," is a tax imposed by states, counties, and municipalities on the sale of specific taxable goods or services. Each jurisdiction, including states, counties, and municipalities, has its own regulations and rates regarding which items and services are taxable.

To determine the items on which you need to collect sales tax in your state, consult your state's Department of Revenue or a similar state agency, along with your local tax office.

Obtain Licenses and Permits

When registering your business, it is important to acquire the necessary licenses and permits from your local, state, and federal government.

Federal Permits and Licenses

If your business is regulated by a federal agency, it is necessary to obtain the appropriate permits from that agency for commercial activities.

• Agriculture
• Alcoholic Beverages
• Aviation
• Firearms, Ammunition, and Explosives
• Fish and Wildlife
• Commercial Fisheries
• Maritime Transportation
• Mining and Drilling
• Nuclear Energy
• Radio and TV Broadcasting
• Transportation and Logistics

To obtain more information about federal licensing, please visit the Federal Licenses and Permits page on the sba.gov website.

State Permits and Licenses

Businesses are typically required to obtain permits or licenses to operate legally. The specific permits and licenses needed may differ depending on the state and type of business.

For more information on permits and licenses in your state, refer to TRUiC's Business License guide for relevant business license resources.

Local Permits and Licenses

Many businesses require local licenses or permits to operate legally within their municipality, which can include things like occupancy permits, food and beverage permits, and permits for signage, lighting, and noise.

It is recommended that you inquire about the necessary licenses and permits from your local county clerk’s office.

Obtain insurance for your startup.

Many startups require some form of business insurance, with certain types being mandated by the state, such as worker's compensation or unemployment insurance. Other types of insurance, while optional, are vital for safeguarding your company against potential crises.

For more information on the types of insurance you may require, or to find specific guides on startup insurance recommendations for over 650 types of small businesses, please refer to our Small Business Insurance guide.

Protect your startup by obtaining an online quote from Next Insurance in just a few minutes.

Protect Intellectual Property (IP)

In order to safeguard your startup's competitive advantage, it is important to secure the appropriate patents, copyrights, and trademarks to protect your intellectual property (IP). By registering ownership of intellectual property, you minimize the likelihood of rivals exploiting the ideas, designs, or concepts that are safeguarded.

Additionally, a Founder Intellectual Property Assignment Agreement transfers the founder's intellectual property rights to the company. This enables the startup to utilize the intellectual property while also maintaining its protection. Founders, who are usually shareholders in the company, continue to benefit financially from their intellectual property.

Get Startup Funding

Startups typically require financial resources to cover their initial expenses and sustain their operations. Additionally, they may seek further funding in order to expand, bolster their inventory, and navigate periods of reduced activity.

When considering your business, it is important to assess the various funding options your company may require and when to secure them. Ensure that you have a thorough understanding of the initial expenses, as well as your financials and projected finances, prior to seeking external funding.

Opening a business bank account can enhance your startup's credibility and demonstrate to potential investors that you are ready for expansion. Consider opening an account with Mercury today and receive a $200 bonus when you deposit $10,000 or more.

The most prevalent types of business funding include:

• Bootstrapping
• Friends and Family Loans
• Business Loans
• Business Credit Cards
• Business Grants
• Angel and Venture Capital Investors
• Crowdfunding

Different stages of business development require different funding sources. For instance, during the seed stage, bootstrapping or loans from friends and family may be the most suitable funding options. However, as the startup grows and enters the growth stage, venture capitalists or angel investors are more inclined to invest.

In addition, the type of startup you are running is also a significant factor in determining the appropriate funding source.

Establish accounting procedures for your startup.

Business accounting is a necessary component of running a startup as it helps in managing financial aspects and fulfilling regulatory requirements. Accounting provides various benefits, such as:

• Gain an understanding of your financial performance.
• Track benchmarks and goals
• Determine the value of your startup.

An accounting system is essential for handling legal obligations, taxes, payment processing, employee salaries, and overall financial management for your startup.

There are various options available for managing your business accounting, such as hiring an in-house accountant, employing a bookkeeper, utilizing a payroll service, or utilizing small business accounting software such as Gusto.

Consider scheduling a consultation with a business accountant to determine potential time and cost savings for your business in regards to tax, payroll, and bookkeeping services.

Create and solidify your startup's brand identity.

Creating a strong brand identity is essential for a successful startup, as simply having a great product, service, or experience does not guarantee customer attraction.

Design a Logo

Designing a logo is crucial to establish brand recognition. Utilize our logo maker, offering thousands of professional, high-resolution, and free logo options. For additional alternatives, explore our review of the top logo makers, including Canva, to create a memorable brand identity.

Build a Business Website

Every legitimate business requires a website, including your startup in the near future.

If you have never built a website before, there's no need to worry. Building a website is easier than ever,by the help of Weblium.

When selecting a website builder, there are numerous options available based on your specific requirements. Various website builders offer a wide range of features, functions, capabilities, and applications to cater to your company's needs.

When designing and writing content for your website, it is important to consider your search engine optimization strategy. This involves increasing website traffic and brand visibility by optimizing site design and content to improve search engine rankings.

Consider building your startup website with Weblium.

Developing a social media presence.

In addition to building a website, having a social media presence is also important for establishing brand identity and growing a startup. Social media allows for reaching, connecting, and engaging with customers and potential clients.

Some of the most popular social media platforms include Facebook, YouTube, Instagram, TikTok, Snapchat, Twitter, LinkedIn, and Pinterest. Additionally, platforms like Yelp, Reddit, and Quora have sizable followings among niche users.

If you would like more information on how to establish your startup's presence on social media, you are welcome to read our guide titled "How to Improve Your Startup's Social Media Strategy."

Distribute Press Releases

An alternative method for promoting your startup is through self-generated publicity, such as writing press releases.

A press release is a formal communication issued by a company to the press in order to disseminate information about the business and brand.

Professional press release writers and press release distribution services, such as Sitetrail, are available for hire.

Hire a Team

The success of a startup is contingent upon the development of a team that is passionate, skilled, and trustworthy in their respective roles.

To start, startups usually require individuals for the following positions:

• Chief Executive Officer (CEO)
• Chief Operating Officer (COO)
• Marketing Director
• Product Developer or Engineer
• Head of Sales
• Customer Service Representative

Before hiring for these important positions, it is necessary to establish a clear mission statement that accurately defines the purpose and values of your startup. In addition, crafting informative job descriptions can help filter out candidates who may not be suitable for the role by providing them with precise details about the job and your company.

Finding Talent

Once the roles have been identified, the next step is to search for suitable candidates to form the team. There are several common methods for finding talented candidates to consider:

• Word-of-Mouth Recruiting
• Online Job Boards
• Recruitment Agencies
• Internal Hiring

Recommended: Find freelance talent with Fiverr.

In the hiring process, it can be advantageous to enhance your job offer by including incentives such as stock options for employees. This is commonly seen in venture capital-backed startups and can help foster loyalty to the brand while also motivating the team to actively contribute to the company's growth.

Employer Legal Requirements

The next step is to complete the registration process for employment taxes, including FICA Tax on the federal level, which is also known as payroll taxes or withholding tax.

In addition, each state has distinct tax obligations for employers, with numerous states mandating payment of unemployment insurance (UI) tax and workers' compensation insurance.

An employment agreement is necessary in order for you and your new employee at your startup company. The agreement includes various policies and agreements that are relevant, such as termination, reimbursement of expenses, disputes, and company clients.

Here are several agreements that you may wish to consider including in your employment contract.

• Confidentiality Agreements
• Services Agreements
• Compensation Agreements
• Non-Compete Agreements

Company Culture

Startup companies often prioritize company culture. It is important to consider what kind of company ethos you want to establish before assembling a team. This will determine the ideal personality types and values you should seek in potential employees.

A strong set of company values contributes to the success of a startup by providing a foundation for the team's purpose, motivation, and attitude. It can also positively impact employee morale and retention.

Learn how to successfully launch and grow your startup.

After the initial launch and first sale, it is important to continue carrying out your plan, staying informed about industry trends, and working towards growing your business. This will require dedication, perseverance, and willingness to take advantage of growth opportunities.

Possible opportunities for growth could include expanding to new regions, targeting additional consumers, or diversifying your product or service offerings.

Opportunities for growth can also arise through innovation, improving quality, developing a customer-focused approach, and streamlining the business model.

Opportunities for growth may involve internal factors such as expanding your entrepreneurial network, increasing your team size, and fostering a robust company culture.

Boost Your Startup Marketing

A solid marketing plan includes identifying target customers, selecting appropriate marketing channels, and implementing a strategy to expand the customer base.

A marketing plan is crucial for the success of your startup's marketing efforts and serves as the guiding factor for your marketing strategy.

To start, be sure to take note of your company's business-critical goals and prioritize what you will concentrate on in the short term. It is advisable to make these goals SMART.

• Specific
• Measurable
• Attainable
• Relevant
• Time-Bound

Once goals are identified, determining the target buyers and creating a compelling message to attract potential customers is crucial for capturing the attention of future buyers.

After completing the initial steps, the team can begin implementing the marketing strategy and focusing on the marketing channels that are believed to generate the highest return on investment (ROI), such as content marketing, online advertising, PR campaigns, social media campaigns, and others.

Marketing Channels

Selecting the appropriate marketing channels for your startup can be a difficult task. However, if you determine which channels yield the highest return on investment, you can then utilize these channels to expand your marketing efforts.

These are some commonly used startup marketing channels.

• Social media can be effectively used to promote products and services for startups, either through paid advertising or regular content publishing. It is recommended to consider platforms such as Facebook, Instagram, Twitter, TikTok, and LinkedIn.
• Affiliate marketing can be an effective strategy to increase sales and build brand credibility. To start, create a comprehensive collection of marketing materials for affiliates to utilize in their promotions, such as digital advertisements, emails, and landing pages.
• Implementing loyalty programs, deals, and coupons can effectively encourage customers to return to your business and make repeat purchases. If a previous customer already had a positive experience with your brand and the products or services you offer, providing them with a coupon or deal could potentially entice them to come back.
• Sponsored events can be an effective strategy for promoting your business to potential customers. By aligning your brand with events relevant to your industry, you can increase your visibility and reap long-term benefits.

Develop a plan to encourage and facilitate growth.

Creating a growth strategy can increase the likelihood of achieving your startup's objectives. This involves expanding your customer base and implementing tactics for profitable and sustainable growth beyond early adopters and existing customers.

Begin by posing these inquiries to yourself.

• If there are plans to raise more funds in the future, what specific achievements will be necessary in order to support a new round of funding?
• How long will it take until you require another funding round?
• What is the appropriate "burn rate" for your startup's anticipated growth and current operational requirements?

Furthermore, it is necessary to strive for comprehending and enhancing unit economics, including:

• Payback period
• Customer retention rate
• Lifetime customer value (LCV)
• Customer acquisition cost (CAC)

Unit economics can be measured by channel, customer segment, and product line. Developing accurate measurements to track and analyze this data helps you create effective growth strategies for your customer base and product line.

Embarking on a startup journey demands passion, creativity, and resilience. Our comprehensive guide offers essential steps and insights for aspiring entrepreneurs. From evaluating entrepreneurial capabilities to brand development and growth strategies, these steps provide a roadmap for navigating the dynamic landscape of entrepreneurship in 2023. By implementing these strategies and adapting to market shifts, aspiring founders can pave the way for their startup's success in a competitive business environment.