The excitement of launching a startup with a great new idea can all too easily leave the minutiae of running a business neglected. The consequences of such an oversight have the potential to sink a company. We shared their top tips with you on how to ensure yours is not one of them.
Think beyond the money
Money is the thing which gives motivation and it is one of most required assets for startup but even relationships can make or break startup. Think beyond the money and consider what else your partners can offer, whether it’s individual expertise or useful connections. Adding an established network to your technology make attractive proposition for investors.
Whom to target for funding
Consider whether the founder will follow their money when company gets bigger. Their position will change dynamics of the business and your plan for progressing it. “It may be too soon to build those things into contracts. As things develop, You can start entering into more formal arrangements.
Crowdfunding provides free promotion but its true value depends on the market, If you are got a fairly long trail that can weigh quite heavily on both future fund-raises and particularly on exits. Investments from one company may preclude investment from their competitors and they already have portfolio company in your area, they may not invest in another one.
Focus on Financial Requirements
Bootstrapping a business is always recommended, Focus on what you really need money for. Do not expect others to take a financial risk on your business if you are not willing to back it yourself. If funds are tight, seek alternative sources of income such as grants and tax credits.
Often there may be things available like R&D tax credits which most technology companies will qualify for almost certainly and that is the effectively cashback.
Work Out what is really valuable:
It could be technology, the vision or staff. Identify the real value and protect the invest in that. If its IP, Protect it when necessary. Patents and registered designs can only be protected for a limited period, But trademark can be registered later if kept under wraps. So resist shouting out your secrets and get confidentiality agreements in place early on.
Keep the Right Identity:
Make it distinctive. Check the name over internet and see if domain name is available. Research with similar companies they might have unregistered rights, and complete a trademark search before committing.
There is an expertise in interpreting whether the results are going to cause you problems are not. The trademark registration is only guaranteed protection for your business name or logo.
Keep things simple
Keep company in business and tax environment and provide straight forward incentives to your staff. Early promises could come back to haunt you on exit. You as the founder will probably be eating into your own share because you are already given up a lot of your company.
Know your Team
Protecting IP and talent makes an employment contract an area where professional advice is worth seeking. A good employment contract also means that when staff are no longer uo to the job, you need not to be afraid to fire them. People will be good for different stages of the business which is okey. It is not disloyal to say we need more help and its not weakness to say i can not do everything.
Don’t forget the exit
You should be thinking about the exit as soon as business got started. Do you really want to exit or you are trying to create a business that is going to be dynasty over years.
Investors may have more control over that decision that you do. If they are going to control it, what protection you put in place for yourself.