Step 1: Plan Your Business Idea
Because of our huge community, we’ve seen the value a solid business plan brings to the table for legitimate startups, and what kind of fallout potentially awaits those who neglect this first foundation-building step. Is there value in spontaneity and going with the flow in the ultra-beginning? Absolutely. But, once you know you’re on to something serious, it’s time to buckle up and start etching out an initial blueprint.
Take Action: Check out our 100% free Business Planning Guide designed to get you from A-to-Z as pleasantly as possible. Plus, we provide access to tons of other great tools along the way.
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: Choose Business Structure & Register
The next step involves choosing a business structure. In the process of registering your business with the state, you'll be protecting your personal assets (house, car, etc) and solidify a brand name.
Most entrepreneurs form an LLC because it has all the benefits of a Corporation without the disadvantages like double taxation, board of directors or corporate officers. However if you're trying to take your company public or raise substantial outside capital, you should probably form a Corporation.
Take Action: Since this step is so important and expensive if it's not done correctly, we highly recommend investing 10 minutes to go over your options through our business structure comparison guide. You'll get a better idea of the advantages and disadvantages of each while building a solid legal foundation for your business.
Step 3: Sync With The South Dakota Tax Code
First and foremost, South Dakota is one of the states without income tax (including corporate/personal) and it’s considered by the Tax Foundation as a top state to incorporate in. From a low ongoing filing burden to booming local economies and no enforcement of capital gains taxes…wow! The trick is knowing what you’re doing so you can leverage as much as possible while adhering to state requirements.
Take Action: Bookmark the Business Taxes info page through the SD Dept. of Revenue. It’s going to be your portal to online services, getting forms if you’re doing this solo, a tax rate finder, and more.
Step 4: Obtain Proper Licensing & Permits
Don’t worry, the red-tape ride is almost over. South Dakota may have more shoreline than Florida thanks in large part to Lake Oahe, but aside from Native American Indian Reservation (tribal) issues and basic state/federal requirements, most small to medium-sized brands who want to be located among the free-roaming bison have little to fret about.
- For DYI’ers head to the state’s Business Entity Registration page which has links to corresponding info for each type.
- For help finding the licenses you’ll need, a Business License Service is what we highly recommend looking into. They determine everything required on Federal, State, County and Municipal levels, get the forms, and provide step-by-step filing instructions.
Step 5: 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 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 6: Pick A Stellar South Dakota Location
No matter where you choose to setup shop in South Dakota, it will have a big impact on your business. Most cities like Aberdeen, Brookings, Watertown or Rapid City are gorgeous slices of heaven in the heart of America with all the modern accoutrements for modern business.
Take Action: We know picking a spot can be tough if it doesn’t somehow happen naturally through your personal/professional networks. If you’d like to brush up on everything that goes into making this decision, refer to our friendly guide on How to Choose the Perfect Location.
Step 7: Finance Your Business
To be frank, outside more conventional means (like where you choose to bank) once your brand reaches the point you may need serious funding online options will become more and more viable. Social lending and CrowdFunding are two very serious paths to consider which are growing in popularity by the second, especially for small businesses.
Take Action: The email course we mentioned in Step 1 really comes in handy here because planning and finances go together like mashed potatoes and wrestling. You can also browse our guide on How to Finance a Business to start generating ideas.
Step 8: Design & Publish A Business Website
Does your website need to be as impressive as Mount Rushmore? No. Not even close. As long as your business website gives the world and your ideal customers/clients/users a way to investigate you, everything else happens over the years. Truth is, “websites” are never done. They grow and adapt as much as your brand will to the pressures of time.
Take Action: The first step is finding the right platform, which thankfully there are some very good options. We highly recommend checking out Wix or Weebly, which are two of the most popular. Both help you build a professional business website while being very easy to use. No previous tech-skills required.
Step 9: Market Your Business
Okay, so your brand’s registered/filed with the state, hooked up into the regulatory system, your financial foundation is set and your website’s published…now it’s time to market! There’s two big tricks: incentives and knowing yourself as the business owner.
Take Action: What kinds of incentives does your niche respond to? What incentives lower your customer/lead acquisition costs? And finally, what are your personal marketing strengths as the business owner? These are critical questions to consider during this first leg of the journey.
Step 10: Continue Learning & Stay Inspired
In essence, the final step has to do with where you put your focus in terms of ongoing education and keeping yourself motivated through the rougher times of being in business. It's not all circuses and candy and who you lend your ear to matters. Consider Startup Savant as a reliable resource and place to turn for insight from fellow entrepreneurs pursuing their goals today.