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If you are starting a business but don’t know where to start, start with the business plan. Now, I know that for a lot of business owners and aspiring business owners, making a business plan can be one of the toughest parts of starting a business. But this is exactly what the business plan is for; it is meant for those juices to start flowing in your head and to get you thinking about every detail of your business, so when you do start it you know exactly where you are going. Your business plan does not have to be a static thing; it changes. Your business plan should forecast about 3 to 5 years out, but along the way you may need to make changes and modify that business plan. And that’s okay. Here are a few of the most important items that you want to put in your business plan:
1. The Executive Summary. An executive summary is especially important if you are going to be seeking investors or a business loan to help finance your business. An executive summary should highlight the best ideas and the most important aspects of your business. For example, what makes your business unique, why is your business is going to succeed, and obviously a summary of what your business idea is. And it should really be just the most important parts of your business plan, that way if someone has just 30 seconds to read over your business plan, they can scan the executive summary and get the gist of what your business is about.
2. The Industry Analysis. This Industry Analysis will show what the market looks like in your business’s industry, who your competitors are and their strengths and weaknesses, who your target audience is and their demographic, as well as who exactly you are going to be aiming for with your business.
3. The Marketing Analysis. Your business plan should also include a Marketing Analysis. The Marketing Analysis should describe how you plan on marketing your business and the types of marketing channels you are going to use, as well as any unique or special ideas you have for marketing your business.
4. The Operations Plan. Your business plan should also include an Operations Plan, which includes information as to what type of personnel you are planning on hiring and some of the processes you will need to follow in the execution of your business. The Operations Plan is also a good place to include some of the milestones or goals you are hoping to accomplish.
5. The Financial Plan. Finally, you will want to include a Financial Plan that highlights what your budget is going to look like: how much money you are starting with and how much money you think you’ll need just to get the business going. Try to budget out what your business is going to need, make some financial projections for your business, including what you think you can make within a given amount of time and what you expect to bring in and spend. Also include information on pricing, i.e., how you are going to price your products or services and how that pricing compares to some of your competitors’ pricing.
6. Form 2553 (S Corp). This is the IRS form that needs to be filed if you want your small business to elect to be taxed as an S Corporation. Whether or not you need to file form 2553 is going to depend on whether it would make sense for you tax-wise to elect to be taxed as an S Corp.
7. Insurance (General Liability, Workers Comp, etc.). Every small business is going to need some type(s) of insurance. The type of insurance your small business will need also depends on what type of business you are operating.
8. Initial Resolution/Consent. Although this isn’t necessary (at least in Colorado) for all small businesses, it is usually a good idea to have an Initial Resolution or Initial Consent to Action when starting a small business in order to demonstrate that your business has adopted certain documents, like it’s Operating Agreement or Articles of Organization, and that you as the business owner have resolved to operate your business in accordance with those documents.
9. Operating Agreement or By-Laws. Every LLC needs an Operating Agreement. Let me say that again in case you missed it: every LLC needs an Operating Agreement. Even if it is not required by statute (Colorado does not require it), it is still a vital internal document for your small business to have. An Operating Agreement is the internal document where the owner or owners (aka the members) agree on how the business is going to be operated, i.e., type and nature of business; what the business is going to do; how members are going to get paid; how distributions are going to be made; what will happen in the event of disagreement between the members; etc. All of this information is set forth in the Operating Agreement. The By-Laws of a corporation serve basically the same purpose as the Operating Agreement of an LLC.
9a. Form SS-4 (Federal Tax ID). IRS Form SS-4 Application for Employer Identification Number is the form that you file with the IRS to get a Federal Tax ID number (aka EIN or Employer Identification Number) for your small business.
9b. Articles of Organization (or Articles of Incorporation). Every single LLC in existence must have Articles of Organization. I can say this with complete certainty because you will need to file Articles of Organization with the Secretary of State in order to create your LLC. Bottom line: if you did not file Articles of Organization, then you don’t have an LLC. Similarly, every corporation in existence must have Articles of Incorporation. The Articles of Organization or Incorporation are what brings the LLC or corporation into a legal existence. Without them, your small business, whether it is a corporation or an LLC, does not legally exist.
9c. Licenses. Specifically, Tax Licenses, Business Licenses, and Other Licenses. Honestly, they are all equally important and depend largely on the nature of your small business.
10. Agreements. Whether they are service agreements, independent contractor agreements, subcontractor agreements, etc., most small businesses are going to need some sort of an agreement in place to operate safely (in the legal sense) and effectively. The type of small business you have will determine the types of agreements you will need to have in place. For example, as an attorney, I have a service agreement (called an Engagement Letter) with each and every client that makes it clear what I am going to be doing for the client, my fees, how the client can expect to be billed, what I expect or need from the client, my policies that affect the client, what happens if there is a disagreement between us, and so on and so forth. Most, if not all, small businesses that provide a service to their customers should, at a minimum, at least have a similar type of service agreement with their clients. It protects both the small business and the client.
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Related: Ryan H. Flax, Esq.
Managing Director, Litigation Consulting & General Counsel
I’ve passed another anniversary at A2L Consulting and in my time as a litigation consultant I’ve been both surprised and reassured about the state of the litigation business and its players (I also wrote about my surprises upon beginning my career as a litigation consultant). I’ve seen both the very best and quite bad litigators in action and have consulted for both. Although some litigators don’t live up to my high standards, I’m impressed by many litigators as both professionals and people. Here are seven of my observations over these years that I think might help you in your practice.
- Many Lawyers Confuse Chronology With Storytelling
It is almost universally accepted that storytelling is important to engaging an audience (including a jury) and that framing a client’s case as a compelling story is key to doing your best at trial, particularly in opening statements. But more often than not, when I ask a litigation team what their client’s story is, rather than explain “why we’re really here” as they would to a jury and illustrate some conflict and emotionally valuable moral that is critical to juror engagement, they rattle off some chronological series of events that led to a legal injury to their client or some misconstrued relationship by the opposing party. These are not stories and presenting a case framed this way, while possibly interesting to a legal scholar, is not compelling to a juror.
I’m surprised that so many smart litigators fall into the chronology trap and forsake emotional connection to engage jurors. I don’t advise pandering to a jury or excessive emoting by a litigator, but for a jury to care about you and your client and generate the stamina jurors need for a trial, litigators must tap into their emotional brains. This is not done by an information dump, a calendar, or using a lot of words.
A story answers the question posed above – why are we here today, in this courtroom? A story also has all the stuff you learned in grade school: a beginning, middle, climax, and end, characters, setting, theme, and moral.
- Some Lawyers Focus Too Much on Too Small Things
It’s easy for litigators (even more so for the associates doing the day-to-day stuff) to over-focus on every detail. The prospect of overlooking a potentially key piece of evidence or being surprised by an unknown fact exposed by opposing counsel is frightening for attorneys (it was for me), so we often wind up thinking way too much about every little thing in a case. This is called being “in the weeds,” and when you’re there it’s exceedingly difficult to escape without help. It happens with the selection of evidence, with witness prep, and even with the development of graphics, where sometimes counsel wants to very carefully think over every aspect, e.g., choosing what font style and color palette and slide aspect ratio will best work for their case.
On each of these things, I urge counsel to take a step back and delegate where possible so they can focus on the BIG PICTURE. The best first-chair litigators do this naturally, and the rest of us need to do it deliberately. Attorney time and brainpower should be spent on figuring out what it will take to win. Let litigation graphics consultants decide what font works best for your opening statement presentation. It will be a relief when you do.
- Many Litigators Don’t Know What Tools Are Available
Even though the litigation consulting industry has been around for decades, I still find a lot of lawyers really don’t know what we do (in total) and what persuasive tools are at their immediate disposal. Often, my first conversations with new clients include questions like, “What all do you do?” The concepts of litigation graphics, presentation and persuasion consulting, trial technology, and jury consulting are not concrete ideas in many litigators’ minds, and I often have to educate clients on what we have in our (their) toolbox.
Most often, such attorneys think of litigation graphics as discrete images created for specific points they want to make during trial. They don’t understand that, while that’s a part of our work, such graphics won’t alone provide the immersive visual experience necessary (particularly during opening statements) to persuade jurors.
Also, many litigators seriously consider doing their own graphics and/or in-court technology presentation. They have Microsoft PowerPoint and Word and can cut and paste and they’ve heard that iPad apps make evidence presentation easy. The former is never a good idea and, while the later might be true for some situations, e.g., a hearing or very small trial, it’s not going to work in any bigger trial that could have hundreds or thousands of exhibits. There is a lot to know about crafting persuasive trial visuals and there are professionals who do nothing but build trial databases, edit deposition videos, and run trial presentation software to create a seamless trial for you and your jurors. Litigators should understand this and use professionals (and let your paralegals focus on what they should be doing as well).
- Litigators Still Wait Too Long to Bring in a Litigation Consultant
Even though they know better, most of the time litigation teams wait until just weeks before trial to engage a litigation consultant / jury consultant / graphics team / trial tech. Even though they know waiting makes it a more difficult budget-sell to their client, leads to an uncomfortable rush to develop graphics, may make mock jury exercises impossible, and forecloses the possibility of building discovery around what they learn from a consultant, they wait. I urge early planning for trial (at the complaint/answer stage), which is the right time to develop that important two-track litigation strategy, and begin working on your case story and graphics as early as possible. Although we can certainly help you late in the game, we can do a lot more before halftime.
- A Lot of Litigation Graphics are Subpar
When I get the chance, I always go to my client’s opening statements and then to as much of the rest of their trials as possible. So I get to see the litigation graphics developed by/for opposing counsel. I’m consistently underwhelmed. It’s impossible to say whether these poor visuals directly led to the oppositions’ losses at trial, but they didn’t help.
More often than not I see a lot of text-heavy graphics – a severe barrier to juror engagement and communication. I see a severe lack of style, clarity, and intentional design – this screams lack of preparation and deliberateness in presentation. There are key visual presentation concepts that, if understood and followed, lead to persuasive graphics, e.g., font type, color choice, simplicity, complexity, branding, style, and others. There is no shortage of information about these concepts out there, but it seems most folks are not paying attention. We are.
- Lawyers Don’t Spend Money Where It Can Help Them
Litigation consulting, jury research, trial graphics, and trial technology cost your client money – very true. But the ROI on these services far outweighs their expense in bigger cases. The cost of a typical larger litigation, such as an employment case, hovers just around $1M. A typical bigger patent case costs about twice that amount. However, the services and tools that could be used to hone your persuasive game at any stage of such litigations turn out to be a very, very small fraction of these costs.
Take a big-time patent and breach of contract case where our client won over $300 million in damages. The costs for A2L’s services were well below $200,000, about 5% or less of the litigation budget and about 0.005% or less of the damages award. I know that our services played an important role in the victory, even though the trial team was beyond outstanding.
But, we still see litigation counsel struggling to decide whether $30,000 or $50,000 is the right spend for a mock jury focus group (a $20K difference that could be the difference between scientific data results and seat of the pants analysis) or whether to spend $12,000 to have a professional trial tech hot seat operator at trial (they should), or whether they can make their own graphics for opening statements in house (they cannot). In my view, saving a penny to lose a dollar makes no sense.
- Practice is as Important as Everyone Thinks
Finally, it’s been shown time and time again that practicing oral argument makes sense. The more you practice, the better you’ll do. It takes time, but again, the ROI on this time investment is tremendous. When litigators do several full speed run-throughs for opening statements or oral arguments, I see them do a fantastic job at the real thing. They don’t need notes, they know their subject matter, they are and appear more comfortable, they seem more reasonable, and they use their graphics perfectly in a compelling way. Not practicing so that you can feel and seem more spontaneous at opening is a recipe for a poor performance. Practice. And start early.
Other articles and resources about litigation consulting and trial preparation from A2L Consulting:
- 14 Differences Between a Theme and a Story in Litigation
- 11 Things Your Colleagues Pay Litigation Consultants to Do
- Conflict Check: Interested in hiring A2L? You’re not alone.
- Storytelling Proven to be Scientifically More Persuasive
- Winning BEFORE Trial – Part 3 – Storytelling for Lawyers
- Don’t be another timeline lawyer – tell a story
- 7 Things You Never Want to Say in Court
- FREE Webinar: Storytelling for Litigators
- FREE BOOK: Storytelling for Litigators
- 6 Reasons The Opening Statement is The Most Important Part of a Case
- Are you smarter than a soap opera writer?
- Stories must close loops to be effective
- 10 Videos to Help Litigators Become Better at Storytelling
- How to paint your client as a hero (with free infographic)
- 5 Essential Elements of Storytelling and Persuasion
- 5 Keys to Telling a Compelling Story in the Courtroom
- Why Trial Graphics are an Essential Persuasion Tool for Litigators
- 10 Things Litigation Consultants Do That WOW Litigators
- 10 Types of Value Added by Litigation Graphics Consultants
- Product CEOs – They love the thrill of inventing new things and new ways to help customers while generally spending most of their time with the R&D team. Often, they have an engineering or analytical degree.
- Sales CEOs – They love the thrill of closing a new customer and figuring out how to win more deals while generally spending most of their time with the sales team (see the SaaStr post on Hyperaggressiveness). Often, they were a sales executive before becoming a startup CEO.
The next time you meet with a startup CEO, see if you can figure out if they’re generally product focused or sales focused. Most fall into one of these two buckets.
What else? What are some more thoughts on product or sales focused startup CEOs?
Product roadmaps are a tricky thing in startups. As a startup, one of the most important aspects of the business is the ability to move fast and make decisions quickly based on new information. With a detailed roadmap, especially one shared with key customers, the ability to change direction can be greatly diminished.
Here are a few thoughts on product roadmaps:
- Consider outlining the public-facing plans in minimal detail for flexibility
- Maintain an internal-only roadmap with more information and specifics
- Incorporate feedback from sales, marketing, services, support, engineering, customers, and partners
- Capture internal ideas in a simple Google Sheet with separate tabs for each constituency
- Provide an idea exchange for customers to submit requests (e.g. tools like GetSatisfaction)
- Constantly revisit the roadmap and question how the pieces fit together
Product roadmaps are an important part of any tech company. In startups, roadmaps are especially sensitive and should be dynamic whenever possible.
What else? What…
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