Startup Checklist

This business checklist will walk you through everything you need to do to launch a startup. Although every business is different, most startups must complete each of these tasks:

Do you have what it takes to create a startup? Successfully launching a business often requires a number of entrepreneurial characteristics.

For example, launching a startup typically requires passion, creativity, motivation, and self-discipline. You’ll also have to be observant, adaptable, and willing to take risks. Here’s the good news: you can work on developing all of these characteristics to turn your thinking toward an entrepreneurial mindset.

Recommended: Are you ready to become an entrepreneur and create a startup? Take the Entrepreneur Quiz to find out!

Even if you’re just thinking about launching a startup, the first thing you should do is to begin building and growing your entrepreneurial network. A strong network of other founders, entrepreneurs, advisors, mentors, and other members of the startup community can serve as crucial sources of knowledge, advice, connections, and resources.

You can start online — either through social media or one of the many founders’ networks like Entrepreneurs’ Organization and StartupNation. Alternatively, you can begin with your local startup community. To find local resources near you, check out our local business resources guide.

Every entrepreneur needs a business mentor. Ideally, it’s someone who has the knowledge and experience to guide you on your entrepreneurial journey.

Having a good mentor can provide a number of benefits. For example, good mentors act as sounding boards for your ideas, offer encouragement, and provide their knowledge and advice.

As you build your entrepreneurial network, start thinking about who might make a good mentor for you. While you might consider anyone with more experience than you as a potential mentor, you should, ideally, look for a mentor with knowledge and experience founding similar companies to yours.

When you find someone you believe would make a good mentor, approach that person as you might approach a business friendship. While it may feel awkward to ask, “Will you be my mentor?” it’s often much easier to ask, “Can I buy you a cup of coffee and pick your brain about my startup?”

Launching a startup begins with an idea. If you still need some startup ideas, begin your search by examining what you already know. This includes your capabilities, skills, interests, and passions.

Attractive startup opportunities — those created with rapid growth in mind — typically share four key qualities. Specifically, they’re:

• Desirable: You want to pursue this idea because the risk vs. the reward is worth it to you.
• Feasible: You have — or can acquire — the skills and resources needed for the project.
• Sustainable: The idea is economically viable, socially responsible, and environmentally friendly.
• Timely: Now is the right time for the market, the idea, and for you.

For help finding the right startup idea for you, read our How to Come Up With Startup Ideas guide or browse our list of the 113 Best Startup Ideas to Make Money in 2021.

Recommended: Try TRUiC’s Business Ideas Generator to find a small business idea that suits you.

As you begin to develop your idea, you should start conducting some market research. Market research is the collection, analysis, and interpretation of information related to your startup idea. You should learn everything you can about your market, your industry, your local area, your target customer, and your competition.

You can conduct two different types of market research: secondary and primary. Secondary market research involves the analysis of existing research. For example, sites like Think with Google™, Google Trends™, and Social Searcher all allow you to conduct real-time research on customer trends, trending online searches, and the current trending topics on social media.

In contrast, primary market research involves collecting new data or hiring a market research firm to collect data for you. This could include collecting customer observations, conducting focus groups or customer interviews, and/or fielding customer surveys.

Naming your startup represents a very important step. Choosing the right name will depend on the type of business you plan to start, its industry, and your target market. To learn more about choosing the right name, check out our How to Name a Startup guide. It discusses how to choose and register a name for your startup as well as how to find a domain name for your business.

You’ll need to ensure the name you choose isn’t already in use and then confirm the availability of your domain name. To do so, try searching the web, federal trademark records, and your Secretary of State’s website (or the equivalent department in your state).

Recommended: Try TRUiC’s free Business Name Generator, which allows you to generate business names for your industry with available domain names. Or, check out our SEO Business Name Generator to find a name designed to rank higher in local search engine results.

Before you spend months — or years — building the product or service your startup will deliver, remember to take some time to test and validate your startup idea.

The goal is to determine if people will actually buy your product or service and at what price. This involves identifying your target market, tracking them down, asking them questions, and then analyzing their feedback.

One way you could test your idea involves creating a landing page and presenting some mock offers to measure customers’ interest and potential for conversion. Alternatively, you could field some simple, online surveys or “A/B” tests to gather customer preference data on features or prices.

Once you collect this information, you can refine your product features, functionality, and pricing as well as your messaging to closely align with your target market’s most important wants and needs.

You’ll also want to create a business plan. Whether you begin with an informal or formal document, the process of writing your business plan requires you to think through all the key elements of your new business.

Creating your business plan also enables you to take an in-depth look at your industry, target market, and competitive position. It’ll help you set goals, determine your keys to success, and outline your strategic approach. This process also will force you to explore your financial projections and cash management strategy.

Business plans come in many different forms, depending on their purpose and the stage of your new venture. In the earliest stages of your entrepreneurial journey, you may want to create an informal business plan (e.g., a lean canvas or a business model canvas).

When you’re ready to begin seeking funding, you’ll most likely need to provide a formal business plan to lenders and potential investors.

Recommended: Try TRUiC’s free Business Plan Generator to get started on your business plan today.

You should consider multiple factors when choosing a business location. The location you select must align with the type of business you plan to start, your target customers, and your brand.

Depending on your business type, you’ll need to consider zoning laws as well as local ordinances and building codes. State and local laws, regulations, and tax rates also should factor into your final decision.

In addition, remember to assess the local labor market to ensure you can find the talent you need.

Finally, if you plan to run a customer-facing business, you’ll also need to consider the neighborhood, demographics, foot traffic, accessibility, parking, other nearby businesses, and the competition.

You should strongly consider incorporating your startup as a formal business structure. The two main types of formal business structures include LLCs and corporations.

These legal business structures require you to register your new venture with the state as an independent entity. As a result, your startup will gain liability protection for its owners and certain business tax benefits.

If you aim to secure outside investments, you should strongly consider the C corporation (C corp) business structure. Why? Most investors prefer C corps. C corps have investor-friendly taxation rules, a simple transfer-of-ownership process, and natural exit strategies. Many angel investors and venture capitalists won’t invest in unincorporated businesses.

Recommended: Check out our review of the best LLC and incorporation services!

You’ll also need to register your business with the Internal Revenue Service (IRS) by obtaining an Employer Identification Number (EIN). An EIN is how the IRS identifies a business. Many types of business structures require an EIN, and you’ll also need an EIN to open a business bank account or hire employees.

To apply for an EIN for free, visit the IRS website or apply by mail, fax, or phone. For more information on how to apply, read our How to Get an EIN (for Free) guide.

Depending on the nature of your product or service and the state in which you live, you may need to collect a sales tax from your customers.

Sales tax, or "sales and use tax," is a tax that states, counties, and municipalities charge on the sale of certain taxable goods or services. Each state — and certain counties and municipalities — has its own set of rules and rates on what’s taxable within that jurisdiction.

Check with your state’s Department of Revenue (or the equivalent state department) as well as your local tax office to learn the goods and services for which you must collect sales tax in your state.

In addition to registering your business, you’ll likely need to obtain a number of licenses and permits from your local and state government agencies as well as the federal government.

For more information on federal licensing, visit the federal licenses and permits page on the US Small Business Administration website.

To learn more about the permits and licenses required in your state, check out our How to Get a Business License guide.

Finally, you’ll need to check with your local county clerk’s office about the types of licenses and permits required in your area.

Recommended: Professional business licensing services can handle the research and filing process for all of the licenses you’ll need to remain compliant.

Your startup likely will need insurance in one form or another. Your state may require businesses carry some types of insurance, such as workers’ compensation or unemployment insurance. You also may want to consider purchasing other forms of insurance that, while optional, can help protect you and your company from disaster.

To learn more about the types of business insurance you may need — or to search for our business insurance recommendations for more than 650 types of small businesses — check out our Small Business Insurance guide.

You’ll also need to set up an accounting system for your startup. Business accounting is an important (and required) aspect of operating a startup, serving strategic, legal, and tax purposes. Business accounting also allows you to track your startup’s financial performance, key benchmarks and goals, and net worth.

Beyond its strategic, legal, and tax-related purposes, your accounting system will enable you to accept payments, pay your employees, and manage your startup’s finances.

You can handle your business accounting in a variety of ways, including hiring an in-house accountant, hiring an outside bookkeeper or accountant, using a payroll service, and/or using small business accounting software.

Recommended: Hiring an accountant can save your company thousands of dollars in taxes each year. Get a free tax consultation with 1-800Accountant.

One of the first things you must consider is how you plan to fund your startup. Many founders choose to self-fund the earliest stages of their startups. But, most startups require outside capital to cover their initial expenses until they generate a profit and again in order to expand, build inventory, or weather slow seasons.

When planning your small business, you should determine the types of business financing options you’ll need and when. The most common sources of business funding include:

• Self-Funding
  
• Friends and Family Loans
  
• Small Business Loans
  
• Small Business Credit Cards
  
• Small Business Grants
  
• Angel Investors and Venture Capitalists
  
• Crowdfunding

To learn more about funding your startup, read our How to Get Funding For a Startup Business guide.

Just like personal credit scores, businesses also earn their own credit score. You can build business credit in several ways.

First, set your business up as a legal entity — either as an LLC or a corporation. Next, get an EIN and open a business bank account.

You also should establish a physical address — not a P.O. Box — and get a dedicated business phone line.

Finally, you should establish a credit account with Dun & Bradstreet — the main credit-reporting agency for businesses.

Recommended: Check out our guide on How To Get a DUNS Number for Free so you can build your business credit faster.

When you’re ready to hire your first employee, you’ll need to complete several tasks. If you’ve been following this guide, you’ll have some done already.

To hire an employee, you’ll need to obtain an EIN, register with your state’s labor department and get set up for unemployment taxes, obtain workers’ compensation insurance, and establish your payroll system. You’ll also need to write a job description, interview candidates, make an offer, and then have your new employee fill out the required paperwork.

To begin building awareness and recognition of your startup’s brand, you must design a business logo. A well-designed logo not only helps people identify and remember your brand, but also can foster trust.

Recommended: Use our Free Logo Generator to create thousands of professional, high-resolution, downloadable logo options for your startup.

Every business needs a website, including your startup. For many businesses, their website serves as the face of the company.

If you’ve never built a website before, don’t worry. It’s easier than ever, and our How To Make a Website guide will walk you through the process.

Website builders like GoDaddy, Weebly, Squarespace, Wix, and WordPress now make it simple to create your own business website without the need for any web development experience.

Recommended: Read our review of the best website builders to find the right one for you.

With everything in place, it is now time to market your startup so you can attract the attention of your potential customers.

Search engine optimization (SEO) represents one way to market your new venture. Specifically, SEO is the process of increasing your website traffic (and your brand awareness) by designing your site and its content to rank higher in search engine results.

Another way to market your startup involves developing a social media presence. Social media platforms provide an easy way to find and engage with potential customers or clients. To learn more about establishing your startup’s social media presence, fread our Social Media Guide for Small Businesses.

Creating and distributing press releases represents yet another way to promote your startup. Press releases can help you increase your startup’s visibility and establish its brand. You can, of course, hire professional press release writers or press releases distribution services like Sitetrail. But, if you choose to write your own, check out our step-by-step guide on How to Write a Press Release.

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