Step 1: Plan Your Business Idea
Before you make any big leaps to start a business in Alaska, you need to write a business plan. Having a well-rounded business plan is essential for securing funding, managing cash flow, and tracking your progress as your business grows and evolves.
Here are a few things you’ll develop in the process of crafting your business plan:
- A pitch. A super-distilled one-page summary of your plan, hitting all the bullet-points below and more.
- A Unique Selling Proposition (USP). A short phrase defining the core mission of your business. For example, our USP at Startup Savant is “Entrepreneurship Simplified.”
- A target market. Who you’re selling to (specifically) and where to find them (specifically).
- A marketing plan. How are you going to promote your business? Through social media? If so, which platform? Paid advertisements? If so, where, and how much do you intend to spend?
- Milestones. What do you hope to achieve in the next 3 months, 9 months, or 2 years? Of course, these are bound to evolve over time, but setting goals is a great way to stay motivated and track your business’ performance over time.
For a more detailed look at business planning, check out our free business planning guide. We go over how to create a USP, marketing plan, executive summary, sales forecast, and everything else you need to include in your plan.
If this step makes you feel a little overwhelmed with details, business planning software might be perfect for you. There are tons of user-friendly programs out there that can help you stay organized and provide step-by-step assistance all along the way. Check out our top 7 business planning software tools for details on the best in the biz!
Don’t know what kind of business to start?
Our friends over at howtostartanllc.com have compiled a massive list of business ideas, ranging from personal styling to axe-throwing businesses.
If you’re having trouble finding the perfect business idea for you, we encourage you to check them out!
Step 2: Register Your Business
Now it’s time to get your business formed and registered with the state.
When it comes to forming your business, there are a few structures to choose from, each affecting your business’ leadership, liability and taxes. Choosing a structure is one of the most important decisions you’ll make for your business, so needless to say it’s important to choose wisely. The main options are:
- LLC (Limited Liability Company): The most popular business structure because it offers the protection of a corporation without the double taxation or intensive legal upkeep. Forming an LLC also offers flexible taxation options -- if your company has at least two members, you can choose if you want to be treated as a partnership or corporation. Alaska allows SMLLCs (Single Member LLCs), too, in which case you can choose between being taxed as a sole proprietorship or corporation.
- S Corporation: More formal structure, with up to 100 shareholders, a board of directors, and corporate officers. No corporate taxation, though, as all income/loss goes through the shareholders’ personal tax returns.
- C Corporation: Organized the same as an S Corp, but there’s no limit to the number of shareholders you can have. C Corps face double taxation: the business and the shareholders are both required to pay taxes on the profits. Check out our guide for more info on forming a Corporation in Alaska.
- Sole Proprietorship: The least hassle, but the most risk. If you’re operating without any partners and haven’t registered a formal business structure, you’re automatically classified as a sole proprietor. No need to file articles of incorporation/organization, but you might benefit from filing a DBA.
If you’re not sure which structure will best suit your business, take a look at our comparison guide.
Once you know how you’re going to register, you’ll need to file with the state, appoint a registered agent, and attend to a few other legal matters. It can be quite a task, and if you’re not up for it there are some amazing services out there that will take care of everything for you. Head over to our top 7 incorporation services for a close look at our favorite providers!
Step 3: Handle Licensing & Tax Obligations
Sure, it’s possible that all you’ll need is a business license - but depending on the nature of your business, you may be required to take care of all sorts of special permits, taxes and professional licenses.
- Federal: You can find all the information you could possible need about federal licenses and permits on the Small Business association website, as well as some basic information on business taxes. Consult the IRS website for more details on federal business taxes.
- State: The Alaska Department of Commerce website has all the links you’ll need to acquire or renew a general business or professional license. If your business involves fishing, mining, selling tobacco products, or some other highly monitored activity, you’ll need to head over to the Alaska Department of Revenue website for additional permits & licenses. This is also where you'll find all of Alaska's business tax requirements.
- Local: For information on municipal business requirements, you’ll need to contact your local chamber of commerce.
If all you need is a general business license, this part may be totally manageable without expert assistance. However, if you find yourself juggling several licenses/permits on a federal, state and local level, you may want to recruit the help of a business license service. This service will do all the legwork on your behalf and send you the proper forms with step-by-step instructions for filling them out.
Step 4: Separate Your Personal and Business Assets
Using dedicated business banking and credit accounts is essential for personal asset protection.
Now that you’ve made it through registering and setting up taxes and licensing for your business, you’ll need to take steps to protect your personal assets and establish your business as an independent entity.
When your personal and business accounts are mixed, your personal assets (your home, car, and other valuables) are at risk in the event your business is sued. In business law, this is referred to as piercing your corporate veil.
You can go a long way in protecting your assets with these three steps:
- Open a business bank account.
A business bank account separates your personal assets from your company's assets, which is necessary for personal asset protection. A designated business bank account also makes accounting and tax filing easier.
To open up a bank account for your business, you’ll need to obtain an EIN (Employer Identification Number). You’ll use your EIN in place of your social security number so that this account is completely separate from your personal finances. After this, start doing your research on various business bank accounts. Local options, like Northrim and Alaska USA, and national banks, like Chase, both have their perks.
Get $200 when you open a business checking account with Chase. Learn more
- Get a business credit card.
A business credit card helps you separate personal and business expenses. A business credit card will also build your company's credit history, which can be useful to raise capital later on.
- Designate an authorized representative.
Make sure all documents are signed by a representative of your LLC and not by you (or other LLC members) directly. This will help separate you from liability incurred by the LLC.
- Keep your accounting and bookkeeping up to date
Make sure to sync up your banking and credit card accounts with an accounting software like QuickBooks as soon as you get the chance. It’s never too soon to start organizing your business’ finances!
Step 5: Finance Your Business
There are tons of funding opportunities out there, including angel investors, microloans, trade credit, crowdfunding, and many more. But depending on the size of your business, level of financial security, whether or not you’ve established credit, and some other factors, you may want to pursue some methods before others. Our guide on how to finance a business outlines all the major strategies and when to choose them -- we highly recommend giving it a read before settling on a primary funding source.
- Alaska’s Small Business Development Center provides free financial advising and low-cost workshops for new businesses. Although they don’t provide funding directly, they can help you figure out what financing options are best for your business, help prepare loan proposals, and provide other general assistance. The ASBDC has locations in Anchorage, Fairbanks, Homer, Juneau, Ketchikan, Soldotna and Wasilla.
- The AGC (Alaska Growth Capital) provides loans through the SBA and the USDA. They’ve been named the #1 community lender in Alaska.
Step 6: Build A Brand
Once you’ve taken care of everything above, it’s time to work on building your brand. In the modern moment, a professional brand is necessary for people to view your business as credible and worthwhile. There are several things that impact your brand image, but two of the most significant ones are your business logo and website.
When it comes to designing your logo, keep the following things in mind:
- Capture the essence of your business. Aim to create a design that reflects the nature of your company. For example, if you’re opening a floral shop, you might use an elegant, cursive font in your logo.
- Differentiate yourself. When choosing colors for your logo, check out the colors your primary competitor uses and head a different direction. This will help you stand out in the market.
- Make it memorable. Select a sleek, bold design that will leave a lasting impression.
- Hire a professional. This is a very important step for your business, and it’s worth investing a few bucks to get your logo professionally done.
Check out our guide to choosing the perfect logo for your business for an in-depth discussion of all of these points and more!
A professional business website is another mega-important factor in building your brand image. A great way to go create a business website is to use an existing web-building platform. This way, you save the time and money involved in building a website completely from scratch. Head over to our top 6 business website builders for our professional recommendations.
Step 7: Market Your Business
The final step, and one that never ends: marketing your business. Marketing is hugely important and requires daily effort and care in order to be effective.
A few things to keep in mind along your marketing journey:
- Know your target market. In order to sell, you need to know who you’re selling to and where they are. Sure, you could spend thousands of dollars on YouTube ads -- but if the ads aren’t crafted with your audience in mind, or your audience isn’t even active on YouTube, you’ve just flushed that money down the toilet.
- Don’t spread yourself too thin. There are tons of marketing approaches to choose from, and too many entrepreneurs make the mistake of trying to master all of them at once. Instead of making half-hearted attempts at content marketing, social media, SEO, and email campaigning, hone in on one and do it well.
- Be willing to evolve. This isn’t to say be hasty -- once you’ve established a marketing approach, you should definitely stick with it long enough to see if it’ll get results. But if it doesn’t, don’t keep wasting your valuable time and energy on an ineffective strategy. Be willing to make adjustments, or even switch gears completely, if that’s what you have to do to reach your target market.
- Don’t get distracted by vanity metrics. Sure, it’s great to get clicks and views, but if your marketing efforts aren’t generating any sales, something’s off.
- Leverage software. There are tons of free/inexpensive programs out there that can help you schedule social media activity, craft professional emails, calculate ROI, and more. Marketing a business is a huge responsibility, so be open to exploring services that could lighten your load.
There’s so much more to say on this topic, but we won’t get into it here. We encourage you to read our definitive guide to marketing a new business for a closer look at all of the above topics and many more.