So you have decided to start a business. Deciding to do something for yourself prompts numerous emotions: excitement, fear, curiosity, and more. Most entrepreneurs face their biggest challenge in knowing where to begin. If you want to pursue a new venture, then this article should provide you with insights into key steps that will help you through the initial stage of building your infrastructure. As you will discover, many of the decisions you make at the nascent stages of a business can, and likely will, have material implications. As part of your due diligence, this article offers five key steps to take when starting a business.
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Define Your Business
The Business Model Canvas (BMC) represents a common approach that MBA students and venture capitalists use as it helps establish the foundation for all other segments of a business. Whether you use the BMC, or any other technique, writing down your ideas and developing a roadmap for your business proves critical. Examples of what to define include your value proposition, channels, customer segments, key activities, and key resources.
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Identify the Type of Entity that Best Suits Your Needs
LLCs, corporations, partnerships and sole proprietorships represent a few of the many corporate structures you may want to utilize. Each entity structure offers pros and cons and ultimately depends on tax implications, governance requirements, equity holders, employees and risk aversion.
The Corporate Transparency Act (CTA) significantly affects new business formations. In March, 2025, the Treasury Department and FinCEN removed beneficial ownership information (BOI) reporting requirements for U.S. companies and U.S. persons through an interim final rule. However, this area of law continues to evolve rapidly, so consult with your attorney about current requirements when forming your entity.
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Find an Attorney Who has Experience in Your Industry
Identify a business attorney who understands business operations. At some point, almost every business needs legal support. The scope of support can include entity formation, contract review, employment law compliance, intellectual property protection, regulatory compliance, and dispute resolution. As you interview different options, ask about the attorney’s background in your specific industry and vertical and his or her experience working with companies at your stage.
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Seek a Qualified CPA to Handle Your Tax and Accounting Concerns
Can you internalize and handle your own books and accounting? Probably. Does this represent the best use of your time, especially if you lack a financial background? Probably not. Most new businesses have limited cash and consequently look to save where possible. However, having a bookkeeper or CPA set up your books and advise you of tax deductions will prove invaluable as you grow your business. A qualified CPA can also help you navigate the complex tax implications of your chosen entity structure and ensure compliance with all reporting requirements.
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Avoid Paralysis by Analysis
Throughout the years, we have seen businesses labor over details with countless iterations of the same business plan. Does this result in a great business plan? Absolutely. Does this result in a great business? Maybe. The key when starting a business is to actually start the business. Yes, all the ideas that this article references matter, but if you are serious about starting a business, then at some point, you need to convert the research and analysis into action. Set deadlines for your planning phase, make informed decisions with the information you have, and remember that you can refine your approach as you learn and grow.
