Starting a Business in Omaha, NE – 2018
Have you been thinking about starting your own business? You’re in good company, with many aspiring to venture into entrepreneurship. When it comes to turning those dreams into reality, however, fewer actually put their money – and just about everything else they have to offer – where their mouth is, proverbially speaking.
There’s truly no one more qualified to offer advice on this topic than someone who has learned their lessons firsthand, perhaps even the hard way at times. Accordingly, we consulted with several local entrepreneurs who have found success in their business ventures and help others do the same, who graciously offered advice based on their own experiences as well as their respective specialty areas.
Let’s kick things off with forming a company. Do you opt for an LLC or S-Corp?
Jeana Goosmann, CEO and managing partner of Goosmann Law Firm, offers guidance to those who are contemplating which would best suit their new business.
“Here are three steps you should take when choosing between an LLC or an S-Corp:
First, determine how many people will be owners or shareholders in the business. LLCs can have unlimited members while S-Corps can only have 100 shareholders or less.
Second, consider how you would like the company to be managed. S-Corps have fixed rules that govern management practices and more structured rigid rules. LLCs can be managed using the structure of your choosing with fewer default management provisions.
Third, determine whether you will invite additional investors to raise capital at a later stage. We work with our clients’ CPAs to ensure we have the company set up for success.
For additional information regarding business law and structuring your business as an LLC or an S-Corp, contact our Omaha law firm today at (402) 280-7648 or visit our website at www.GoosmannLaw.com.”
How your new business is structured is just one of the many, MANY decisions you’ll be making in the beginning stages. With so much to think about and to be done, it can be intimidating and overwhelming for even the most dedicated, organized and intrepid of entrepreneurs.
“Starting a business is one of the hardest, yet rewarding experiences for any entrepreneur,” says Shana Boyd, account director and partner at Eleven Twenty-Three. “Often you are giving up a cozy lifestyle, or corporate position, to follow your passion so you run full steam ahead toward your dreams with open arms ready to take on the world.
As a business owner, I learned pretty quickly that running toward my dream meant giving it my all. All of my time, all of my money and all of my heart. It sounds like a tough deal and might make some of you wonder why anyone would be crazy enough to venture into this. Well, after five years of owning a business, I can tell you firsthand that this is the most rewarding thing I’ve done.
Something to remember is to stay consistent in your actions, focus on what your brand does best, hire people that fit your culture, and finally, never stop promoting your business. When you are in that first year it’s easy to get wrapped up in the details. There are a lot of to-do’s to be checked off within the business like setting up accounts, installing software, creating best practices, creating websites and finalizing construction of your future space. Time and time again you’ll get pulled away from working on your business growth strategy. It’s important to always keep a focus on building your brand. Keeping new customers, or even prospective customers, interested in what you have to offer will keep the doors open.
As an owner of an advertising agency, I knew the importance of branding and establishing a presence that allowed us to stand out from the competition. But, as a new owner, I too found myself struggling to find the time to get these things in place. My business partner and I had to set aside time to work on these tasks. Making the time allowed us to grow our business and our team. Most importantly, we get to help all of our clients grow as well.
If you are thinking about starting a business, do it! You will have your ups and downs, but if you continue to keep your focus and are passionate about what you do, you will succeed.”
Finally, as far as what all to consider before you commit, in agreement Jethro Hopkins, founder and owner of No Coast Business Advisors, is also quick to point out, “Are you prepared to invest your life in your business? That’s what it takes to be successful.”
He goes on to provide the following advice:
“If you are planning on starting a new business and don’t have any prior experience with business ownership – I’m not talking experience in a management role, in the industry, you’ve done your research, or any of that but strictly as a business owner – I’d recommend structuring the company as a corporate entity as opposed to a sole proprietorship or partnership. By doing so, it gives you what is called the ‘corporate veil.’ This is a legal concept that separates the business’s liabilities from the personal liabilities of the owner(s). It provides a certain amount of protection in that if things go drastically wrong, it’s harder to go after your personal assets. You and your family will be protected from any devastating losses that could completely wipe you out.
I know that sounds extreme right out of the gate, but this isn’t something that’s best viewed with rose-colored glasses. Starting a business sounds exciting, and it is, but it’s incredibly scary too. If you’re not scared, chances are you’re in trouble because you’ve only considered the possibilities in the event of success and not the very real possibilities that come along with failure.
Those who fully understand what’s in front of them for the first few years are terrified but feel that it’s worth the risk to pursue their passions and dreams in spite of the odds. And those who succeed past the first few years are the ones who have put in everything they have to give to get themselves to that point. The thrill of it will wear off quickly, so you should be absolutely certain you’re entirely committed.
Don’t be completely discouraged by the high failure rate of new startups, but do be honest with yourself and put yourself in the best position to succeed so that you don’t become a statistic. I’m a firm believer in putting things down on paper so that it makes it real. Document your business plan, which could be in a more traditional format or by simply listing what you want to achieve and actionable steps to get there. Equally important, list any and all of the potential problems and roadblocks you might encounter along the way. Having that in front of you will not only help you stick to the plan since you can reference it often, but you’ll also be better able to convey your thought process and intentions to others. It can be reviewed thoroughly so that other people can collaborate, whether it’s helping you solve the problems you’ve already identified or adding to the list so you won’t be blindsided by something you hadn’t previously considered, which will further mitigate your risk.
Managing costs in the early stages is critical; although you do have to spend money to make money, until you’ve established a solid revenue stream, it’s wise to only spend money on what’s absolutely necessary. Startup costs will vary for each business, but there are some things you can look into that will minimize your expenditures up-front until you’re in a better position to invest back into your business. There are a whole host of ways that startups can save money when things are tight while they get off the ground, it’s just a matter of taking the time, putting in the effort, and consulting with others to identify them.
As for the latter, networking will be invaluable. Surround yourself with people who know more than you, have more experience than you, and have had more success than you, then watch and learn. If you’re the smartest or most experienced person in the room, then you’re in the wrong room. I can’t emphasize enough the importance of learning from the people who have done what you want to do. The people around you will either make you better or hold you back – there’s really no middle ground on that. You’re going to encounter things along the way that you didn’t expect – tons of them, actually. Along with networking, put together a trusted team of advisors – your lawyer, accountant, banker, mentor, etc. – and consult with them regularly. Finally, develop strategic partnerships with fellow business owners. There’s strength in numbers; support one another and help each other succeed.
Being a business owner is a lifestyle, not a profession. It will need to come first before everything else in your life, at least in the beginning. For some, that never changes. After the first five years, it does get easier. In the meantime, if you need help, there are many professionals who can assist you in your efforts who are easily found at local networking events. Although No Coast Business Advisors specializes in buying and selling established businesses, we also help keep them running, and are happy to sit down and assist you with your efforts in whatever way we can.”
In summary, getting back to the basics, here’s a quick list of steps to take to start your own business: 1. Select a name and legal structure. 2. Write a business plan. 3. Obtain your Federal Employer Identification Number (FEIN). 4. Open a bank account. 5. Lease office or retail space, (if not home-based). 6. Obtain licenses and permits – Federal & State. 7. Hire employees (if applicable). 8. Set up an accounting system. 9. Obtain business insurance. 10. Systemize and organize. 11. Develop your business identity and get the word out. 12. Focus on your written business plan. Start generating revenue/sales; begin marketing, social media, website, business branding, business cards, letterhead, and so on. 13. Know your market, identify competition – run a marketing S.W.O.T. analysis.
Specifically regarding that final point, there will be more startups in the next decade than perhaps the last 100 years. Competition is only going to get more tough from here on out. Statistically, approximately 70% of all businesses will fail. The good news is based on that number, approximately 30% will survive. Make it your mission to be one of the latter by setting yourself up for success from the very beginning. Learn from successful people and businesses, locally and globally. Study them and apply that knowledge to how you run your own business. Be intentional–the more you can do to put the odds in your favor, the better.
As you might suspect, or are acutely aware if you’ve done your research, there’s a lot that goes into starting a business. Successful businesses that stand the test of time don’t get to that point by accident or pure coincidence. It’s hard work, requires dedication, and involves many aspects that should be carefully considered and thoughtfully planned. If you think you’ve got what it takes, put your plans in motion, find yourself a mentor, and put together a team of professionals that will help you build a strong infrastructure. If you’ve got something special that you want to share with the world, get after it and make your dreams of business ownership come true!