Master Checklist for Starting A Venture

Entrepreneurship is more of a winding path than a stairwell. Nonetheless, the overall process tends to hold true between entrepreneurial ventures. 

Please use the checklist below to help guide you through the maze that is entrepreneurship. (Note: Some of the elements in the list are outside the scope of this book; however, there are numerous resources generally available to cover these topics.)

Idea, Concept, Product, or Service

• Develop a new concept
• Acquire and utilize an existing concept
• Improve an existing concept

Market Research (Qualitative and Quantitative Metrics)

• Known as Market Analysis and Feasibility Study
• Market Size (Quantitative Data – Secondary Research)
• Market Segments (Quantitative & Qualitative Data – Secondary & Primary Research)
• Target Market(s) (Qualitative Data – Primary Research)
• Market Demand (Qualitative Data – Primary Research)
• Pricing Model (Quantitative Data – Primary & Secondary Research)
• Projected Costs of Production and Logistics (Primary Research)

Seed Capital

• Personal Funds, Personal Credit
• Business Loans – Establish credit relationship or line of credit.
• Friends, Family, and Fools as Investors or Lenders.

Product or Service Development (Or Acquisition)

• Personal or Team Member development
• Employee; Work for Hire development
• Alpha & Beta Tests

Strategic Analysis & Business Model

• SWOT (Strengths, Weaknesses, Opportunities, Threats)
• Determine Sustainable Competitive Advantage (E.g., Intellectual Property)
• How will with business operations effectuate a swapping of value between your business and clients/customer?

Preliminary Business Plan

• Explain market need or want
• Give business concept (Raison d’tre)
• Include Basic Financials – based on Market Research
• Incorporate Business Model (Manner and method you will deliver value)

Protect Intellectual Property

• Design or Utility patent for any technology or product.
• Protect any trade secrets for product or services.
• Register with State and Federal Trademark your name, logo, or representative symbol.
• Copyright any original expression (Music, Video, Written work)

Form a Team

• Establish preliminary roles for founding team members.
• Look for complimentary, not duplicative skills.
• Look for personal fit of members, as much as talent.
• Make certain there is a common goal (ex. 3-7 year exit plan).

Form Business Entity

• Pick and Register Your Business Name, (Perhaps Trademark Name at USPTO)
• EINs, Registered Agent and Articles of Organization
• Initial Board or Management Meeting; Ratifications; Equity Provisions; Appointments.

Entity Structure & Ownership Agreements

• Operating Agreement (LLC); Bylaws (Corporation)
• Determine Owners’ Role (Title, Responsibility, Compensation)
• Determine Equity (Dilution issues, Type(s) of Equity Instrument)
• Determine Control and Decision-making Authority of each member

Preliminary Administrative Setup

• Open Business Bank Account(s) (Establish Credit)
• Bookkeeping System (Tax, Payroll, Operations)
• Business Insurance (Umbrella Policy)
• Research Professional Help (Accountant, Attorney)

Fund Business

• Transfer Assets to Business Ownership
• Capitalize Business with Seed Capital and Form Business Accounts
• Issue Ownership Interest (Equity Shares)

Startup Funds or Bridge Capital

• Business Loans
• Angel Investors
• Business Debt (Typically Convertible Notes)

Secondary Administrative Setup

• Business Licenses (Local Regulations)
• Local Registration (“Fictitious Name Filing”)
• Business Location
• Commercial Lease vs. Purchase Property
• Alternative Arrangements (Home-Office, Coffee Shops, Group Workspace, etc.)
• Utilities, Internet, Phones, Fax, Copy/Print, Mail (P.O. Box); Servers or Cloud Storage, Intranet.
• Office Build Out; Office Design; Furniture, Office Supplies, Technology (Computers); Storage
• Insurance Business Plan; Umbrella Business Policy

Hiring Personnel

• Employees (Full & Part-time) vs. Independent Contractors
• Posting positions, Employee Referral, Interviews, Checking References
• E-Verify Employee Status (Immigration Law)
• Employee Compensation and Benefits; Contracts; Handbooks

Tertiary Administrative Setup

• Tax Accounting (Withholding; Reporting System; Auto-Deposit State and Federal)
• Worker’s Compensation Coverage
• Employee Benefit Management (401K, IRA, Health Plans, Life Insurance, etc.)

Sales Strategy

• Personal Sales vs. Distributor
• Internal Sales Force vs. Outside Sales Team
• Physical location, internet, catalog, outsource fulfillment.

Marketing & Advertising Plan

• Logo, Trademarks.
• Traditional Plan (Print, Television, Radio, Mail, Signage)
• Website (Hosting, Template Design, Content Development (blog), Maintenance; Backup.)
• Pay-Per-Click, Search Engine Optimization, Social Media Plan
• Personal Relationship Marketing (Business Cards, Join Professional Organizations, Networking)

Business Plan

• Purposes: Investors, Lenders, Planning (internal).
• Business Concept, Model, & Description
• Business Team & Roles
• Market Breakdown and Competitive Advantage (IP)
• Capital Demands and Proposed Use of Capital
• Include 3-year financials (Payback, IRR, Exit Valuation)
• Develop the Investor Pitch (Unified theme & goals)

Operations

• Production
• Outsourcing, Local Sourcing, In-house Production
• Equipment, Raw Material, Suppliers,
• Ordering & Customer Service
• Order fulfillment; Manage Customer Service
• Logistics
• Manage Shipping – Supplies and Customers
• Management Plan
• Personnel & Reporting
• Human Resources (Employee Benefit Management)

Business Governance

• Educate yourself of Business Entity Governance Requirements
• Have competent legal counsel and guidance.
• Governance issues pertaining to business setup
• Article of Formation, Ratification, Appointments, Equity Issuance, Bylaws, Shareholder Agreements.
• Routine Governance
• Board Meetings; Annual Filings
• Reporting Requirements
• Record Retention and Certification
• Major Decisions
• Director Decisions
• Shareholder/Owner Voting Rights

Growth Funds (Angel Investment & Venture Capital)

• Network and use any connections to meet and become known to angels and venture capital firms.
• Even if you are early stage, become known early.
• Always have updated financials handy.
• Practiced your elevator pitch (concept, model, growth expectations, and possible exit scenario)
• Educate yourself on Series A, B, C Funding and the J-Curve
• Typical terms and expectations given your industry, operations, and business model.
• Securities Regulation and Compliance
• Avoid State and Federal Securities Registration; Understand the exemptions & comply.
  • NOTE: Identify a competent legal firm
• Working Financial Documents:
  • Balance Sheet, Income Statement, Cash Flow Statement.
  • Have ratios memorized.
  • Accounting and financial disclosure becomes more important.

Growth

• Improve Operational Efficiency
• Acquire Higher % of Existing Market Share
• Expand into New Markets
• Expand Product or Service Line

Exit Event

• Liquidation
• Options and obligations for shutting down operations.
• Bankruptcy
• Options available: Ch. 7, Ch. 11, Ch. 13
• Strategic Purchaser
• Evaluating potential transactions
• Advertising business for sale
• Private Equity
• The Process & Options
• Adequate financial positioning
• IPO
• The Process & Options
• Hire an Investment Bank
• Obtain Legal Assistance

Note: This list of steps in the process is by-no-means exhaustive. Hopefully is will provide a baseline of the entrepreneurial (Startup Venture) process.