15 Frequently Asked Questions About Starting A Business

Forbes

13-05-2025

By Richard D. Harroch
Having been a startup lawyer, entrepreneur, and venture capitalist, I have been asked many of the following questions over the years by entrepreneurs when starting a business. Sometimes there isn't an easy answer, and as lawyers often like to say, 'It depends on the circumstances.' But here are my shorthand answers to the most frequently asked questions on starting a business, which hopefully will be right 95% of the time.
Start it as an S corporation or an LLC, unless you have to issue both common stock and preferred stock; in that case, start it as a C corporation. An S corporation can easily be converted later into a C corporation. Partnerships and sole proprietorships are to be avoided because of the potential personal liability to the owners of the business.
The standard answer to this is Delaware because of its well-developed corporate law. However, my answer is that in most instances it should be the state where the business is located, as this will save you some fees and complexities. You can always reincorporate later in Delaware.
As much as you can reasonably afford, and in an amount to at least carry you for 6-9 months with no income. What you will find is that it always takes you longer to get revenues, and that you will experience more expenses than you anticipated.
Any of the following:
This is difficult. First brainstorm with a bunch of different names. Then do a Google search to see what is already taken, and that will eliminate 95% of your choices. Make it easy to spell. Make it interesting. Don't pick a nonsensical name where people won't have a clue as to what you do (with all due respect to names like Google and Yahoo). Do a trademark/tradename search on the name, then make sure you can get the domain name. See What Should I Name My Startup: 13 Smart Tips.
The key challenges to starting a small business are:
Key mistakes made by entrepreneurs include:
Ideas are a dime a dozen. It's the actual implementation of an idea that is more important. If it's truly unique, get a patent for it (see www.uspto.gov). You may get some protection through copyright, trade secret programs, or NDAs, but not a lot.
Every good '.com' domain name is already taken. And I usually only recommend '.com' names. Ultimately, 99% of domain names are available to be bought—you just have to be prepared to pay for the name. Do a 'WHOIS Search' at www.networksolutions.com to find out the contact information for the owner of the domain name you are interested in, and offer to buy the name. Don't be naive and offer $500 for a premium domain name. You will be ignored. Be willing to pay a fair amount for a good name.
Entire books are written on how to get website traffic. The key ways are as follows:
Key steps to take:
It's sometimes useful to come up with a business plan to think through what you want to do for the development of the product or service, marketing, financial projections, and more. Then get input from trusted business/finance advisors. But don't go overboard with a 50-page business plan. In reality, many startups have to deviate from their plan. See Don't Waste Time on a Startup Business Plan—Do These 5 Things Instead.
Consider the following insurance, depending on your business:
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Copyright © by Richard D. Harroch. All Rights Reserved.