The Biggest Challenge No One Tells You About Running A Startup

Wednesday, December 28th, 2016

The Biggest Challenge No One Tells You About Running A Startup

Being an entrepreneur is immensely rewarding, but also challenging. And the toughest thing about the job is something you might have to learn the hard way.

It’s five in the morning, and I’ve just pulled my second consecutive all-nighter. As I reach for my cup of coffee – I’ve lost count of how many I’ve drank at this point – my mind wanders to how much there is yet to do. A part of me rages against the work I’m doing.

I should go to the gym, it screams. I should be getting more sleep, eating food that actually requires some preparation, and spending more time with my family. Unsuccessfully stifling a yawn, I suppress that voice.

I have deadlines to meet, after all. I have clients waiting on the work I’m to deliver, and a reputation to uphold. What I fail to realize is that I’m moving at breakneck speed down the path to burnout.

Does any of what I’ve written above sound particularly familiar to you? If you’re a new entrepreneur, it probably does.  We live in a culture where working upwards of sixty hours a week is viewed as a badge of honor.

“Look at how hard they’re working,” people crow. “They must really have their life together.”

What they don’t see is all the cracks beneath the surface. The jilted lovers and abandoned friends. The health problems and crushing anxiety.

Don’t get me wrong – running a startup is a difficult job. Most people aren’t really equipped to do it. Late nights and long hours are, to some extent, inevitable.

At the same time, I’ve seen too many people conflate hard work alone with success. If you’ve got a good work ethic, that’s great. Hold onto it.

At the same time, it’s important that you learn to prioritize. As the old cliche goes, you need to learn how to work smart instead of just working hard. And that’s the thing that a lot of newer startup owners fail to see; the reason so many entrepreneurs succumb to burnout.

They’re perpetually overwhelmed. They’re running on empty, and throwing themselves at busywork without any real concept of what it’ll accomplish. They’re slaving away, even though they’re aware that they aren’t built for this – no one is.

Here’s what they – and what you – should do instead:

 

  • Learn to walk away. If you’ve spent an hour staring at the screen with no idea how to solve a problem, get up and go for a walk. Take a bath. Ride your bike. Play with your pets or kids. Give your brain a chance to refresh itself and catch up, and you might be surprised at what you come up with.
  • Deal with distractions. Set a timer during breaks to ensure you get back to work right away. Avoid going on social media when you’re working. Organize your email, and get used to working offline every now and then.
  • Prioritize. You know exactly which tasks are higher on your priority list – complete those first, no matter what other stuff you’ve got on your plate. I’ve been guilty in the past of distracting myself with pointless busywork, ignoring the fact that I’ve a critically important job that I’m simply not finishing.
  • Work in chunks. Most people don’t work well when they’re simply slaving away for hours on end. Instead, try completing work in short bursts, doing one task at a time.
  • Recognize your own workflow tendencies. Everybody works a bit differently – figure out what’s most effective for you.

 

I get it. You have a tendency to get lost in your work – I do too. Just make sure you don’t end up so lost that you can’t find your way back to the real world afterwards. By learning to work a little smarter, you can steer yourself off the path of burnout, and towards greater success in the future.

Five Things You Need Before Incorporating Your Business

Monday, December 19th, 2016

Five Things You Need Before Incorporating Your Business

So, you want to incorporate your startup? Make sure you take a look at this checklist first – if you forget any of these items, you could be in trouble.

There are plenty of reasons to incorporate your business – but there are also plenty of reasons you might want to hold off doing so, as well. You shouldn’t be too quick to make a major decision out of the blue. Instead, it’s something you need to carefully consider.

And while you think about it, you’ll also need to collect a few things:

The Vital Details

First thing’s first, you’ll need to figure out the following:

  • Your business’s name and address.
    • Make sure your business name is unique, and doesn’t contain certain words like ‘bank’ or curse words.
  • The names and addresses of any decision-makers within your business – who are your founders, executives, and board members?
  • The physical address of your business in the state where it was founded.

An Agreement Between Decision-Makers

Here’s a question for you – how are you going to handle a disagreement between your business’s founders? What will you do if one person wants to buy out at some point down the line? Who will buy your business, and what will it be sold for? These are all contingencies you need to iron out with your fellow decision-makers before incorporating if you want to avoid a nasty legal dispute down the line.  This is typically called a “Buy Sell Agreement” or “Shareholders Agreement”.

An Understanding Of What You Want From Incorporation

There are a ton of benefits from incorporation, but it also comes with a few disadvantages – namely paperwork, fees, and the fact that liability protection isn’t 100% guaranteed, depending on the state you’re incorporating in. Before you incorporate, think carefully about why you’re doing so.

Is it for privacy? Tax benefits? Employee incentives? Make sure you’re doing it for the right reasons, and that there aren’t any easier alternatives available to you.

The Documents

Every state has slightly different rules where incorporation is concerned, including which articles of incorporation you need in order to move through the process. Check your state’s website, and gather all the necessary documentation, including the required forms. Once you’ve done that, you can render the final decision on whether or not to incorporate.

A Knowledgeable Agency To Help You Along

Last but certainly not least, it’s advisable to bring in a third party with a working knowledge of the incorporation process – a firm like MyNewCompany. Founded in 2001, our goal is simple – to make starting a business as simple, fast, and inexpensive as possible. We’ve helped form thousands of companies for our clients, and have grown into one of the largest and most reliable providers of incorporation, LLC formation, and other small business services.

Contact us today, and we’ll help you make your business a reality – without breaking the bank.

Why You Shouldn’t Wait Until the Election to Start or Grow Your Business

Wednesday, October 19th, 2016

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Something we’ve been hearing over and over recently from clients and potential clients alike goes something like this: “I’m going to wait until the election is over to see if I should start my business” or something similar. Some existing business owners have said similar things in regards to expanding their business, spending money on marketing or capital improvements, etc. Basically, they want to see what the political environment will be like before pulling the trigger on any big decisions.

While that seems like the prudent thing to do, let’s go over the reasons why that might not be the best strategy:

  1. Gridlock will be likely
  2. You’ll lose months of momentum and experimentation
  3. Your best competitors will not have such hesitations

1. Gridlock will be likely:

Hillary Clinton, should she win, will almost certainly be dealing with Republican majority in the House and maybe the Senate. Republicans only need one house to block any meaningful legislation. There’s also a lot of “bad blood” going around this election season so there’s yet another reason why the 2 parties are likely not to agree on much – in this case, gridlock of our government is a “feature, not a bug” so when American’s can’t agree, the government usually can’t either. Also, recent scandals (emails, Benghazi, etc.) may cause both parties to fight from day one.

Donald Trump, should he win, will also be dealing with a hostile congress, even if it is Republican majorities in both houses. He’s made many enemies in his own party, in particular, Paul Ryan who is the Speaker of the House. Trump getting much legislation through in this environment is unlikely. Also, the Democrats will be extremely angry at his tactics to secure the Presidency so they’ll likely be willing to block anything just to spite him.

2. You’ll lose months of momentum and experimentation

In the small business world, speed, momentum and being able to test your product, message, marketing and other things is critical. Speed is one of the main advantages of small business. If you wait around for months to even start a business or spend money on improving your business you’re likely to lose momentum to other competitors. Speaking of…

3. Your best competitors will not have such hesitations

Many have written about the vast fortunes that were created in recessions/depressions and challenging political environments. The lesson is that while their competitors were petrified to move or even downsizing, smart entrepreneurs were taking advantage of tough times to “buy low” (investments, property, etc.), expand their business, simplify and streamline their operations and keep moving forward. Recessions are usually a convenient excuse to not do anything.

Should I worry at all?

Sure, any political or economic environment is unpredictable by nature, but these worries are usually not justified for small businesses or startups. It’s large companies that have the most to lose. Small business is nimble, quick to adjust and ultimately much more suited to survive the worst. Focus on the positive, the opportunities that even bad environments can bring and you’re much more likely to thrive.

The New Mexico LLC – The Most Private Entity in the USA

Wednesday, March 16th, 2016

One of our most frequent requests or inquiries is how to be “anonymous” or at least not have your name on public records when forming your company. With modern websites like CorporationWiki and state databases, the names of company owners are not only searchable but openly pushed into search results of search engines like Google.

Despite what you’ve heard from many people who push the use of Nevada or Delaware companies, in most cases the owners, Directors (of a Corporation) or Members (of an LLC) are going to be listed on a public database somewhere. This database is almost always searchable to the general public and if not, then an inquiry directly to the Secretary of State by an attorney or other authority will usually get the data they need.

This is where the New Mexico LLC comes into play. As of the date of this post, New Mexico does not require listing the names of the LLC Members on the Articles of Organization when forming the company. More importantly, New Mexico does not require an Annual Report that lists the name of the members. The Annual Report (which is called different things in different states: “Annual List”, “Statement of Information”, etc.) is basically how each state keeps track of a businesses address and owners. This is the big difference between New Mexico and other states: other states may not list the Members or Directors on the initial filing but almost all of them will require it on the Annual Report. New Mexico never asks for it.

This means that as long as you have filed your LLC in New Mexico then the members (owners) are not going to be searchable and you will effectively be anonymous.

There are a few important things to note about the New Mexico LLC:

  • The Articles of Organization do require that you list the name and address of your Registered Agent. This is why we recommend you use a Professional Registered Agent, even if you form the company yourself. This will be another level of anonymity.
  • When you go to open a company bank account, the bank may have issues with the fact that there are no owners listed on any database. Typically this can be overcome with a copy of the Articles of Organization, a signed Operating Agreement and a banking resolution (we provide all of these to our clients).
  • Things may get more complicated when you go to obtain your Federal Employer Identification Number (FEIN or EIN); the IRS requires you to assign a person who is a member of the company to be the “responsible person”. As far as we know, EINs are generally not searchable by the public but this is where anonymity will begin to get more complicated. Some people use a trusted relative or other person to be this person.

So basically, you can form a New Mexico LLC, make sure to use a 3rd party as your Registered Agent and navigate the pitfalls that may come from opening a business bank account and you’ve achieved a level of privacy that most American’s would envy.

 

Urgent Alert for Nevada Corporations

Tuesday, June 23rd, 2015

Urgent Alert for Clients with Nevada Corporations: Additional State Fees Effective July 1st

Dear Clients,

MyNewCompany.com, Inc. has been notified by the Nevada Secretary of State of two fee increases that were recently jammed through the legislature and signed by our Governor via Senate Bill 483 (we’ve only been notified within the past few weeks and it wasn’t clear until a few days ago when the fees would be effective). Those additional fees have been verified and are as follows:

  • The “State Business License” (which is being renamed to the “State Business Registration”) is being raised from $200/year to $500/year effective July 1st for Nevada Corporation’s only – LLC’s and other entities are not affected and will continue to pay the $200/year fee.
  • The “Annual List” which is due every year at the same time is being raised from $125/year to $150/year.

This means that basically it will now cost $650/year plus any Registered Agent fees (our fees are $99/year and guaranteed not to raise) to maintain your Nevada Corporation. I can assure you we and the Nevada Registered Agents Association are as angry about this as our clients. This is probably going to decimate our Nevada business so we’ve come up with the following options for our clients’ that do not want to pay that fee; please remember that time is of the essence and feel free to email or call us about any of the options mentioned below.

We apologize on behalf of the shortsightedness of our Governor and Legislature and hope one of the following 6 options will be beneficial to your company.

Thanks,
Matt Knee
Founder/President
MyNewCompany.com, Inc.

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Option 1: Not using the Company?  File a Dissolution

 

Option 2: Want to remain a Nevada entity but don’t want to pay that fee? Form a New Nevada LLC while Dissolving your current Nevada Corporation.

Important Details:

  • Both the Articles of Organization for the new LLC and the Articles of Dissolution to close the Nevada Corporation must be submitted together to release the Corporation’s name for use as your new LLC name.  Please place both orders at the same time.
  • The state fees start at $175 and the process takes about 10 – 12 Business Days.  Additional services and options and faster filing can be added when ordering.

Pros:

  • Easier than filing a Conversion or Domestication (Discussed Below)
  • Yearly State Maintenance Fees are $350 instead of $650 per year.

Cons:

  • You’ll receive a new State File Date and Effective Date
  • New FEIN (Federal Tax ID) will be required

 

Option 3: File a New Company in your Home State, then Dissolve your Nevada Corporation.

Important Details:

  • The Nevada State Fee for the Dissolution is $100 and the process takes about 10 – 12 Business Days.  Additional options and faster filing can be added when ordering.
  • The State Fees and turnaround time for the company formation depends on your home state.  Fees, packages and options are available on the Online Price Quote

Pros:

  • You can act as your own Registered Agent in your Home State
  • You’ll only have to deal with and pay fees to your Home State.

Cons:

  • You’ll receive a new State File Date and Effective Date
  • You will need a new FEIN (Federal Tax ID)

 

Option 4: Conversion from a Corporation to an LLC in Nevada (Get a quote here)

Important Details:

  • The state fees start at $425 and the process takes about 10 – 12 Business Days.  Additional options for faster filing will be provided with your quote.

Pros:

  • Your FEIN (Federal Tax ID) stays the same.
  • Your State File Date and State Filing Number will stay the same.
  • The State Business License yearly due date does not change, you’ll just pay $200 instead of $500
  • No separate Dissolution is required to close the Nevada Corporation

Cons:

  • A “Plan of Conversion” must be drafted by your attorney and adopted before the Conversion process starts.
  • Your attorney or tax advisor will need to draft a new LLC Operating Agreement to replace your Corporation ByLaws to be adopted when the Conversion has been filed.

 

Option 5: Domesticate (Move) your Corporation from Nevada to Wyoming (Get a quote here)

Important Details:

  • The state fees start at $432 and the process takes about 8 – 10 Business Days.

Pros:

  • More affordable than keeping your Nevada Corporation: State yearly fees are $50 instead of  the $650 per year in Nevada.
  • You keep your FEIN, File Date and company history.

Cons:

  • A “Plan of Domestication” must be drafted by your attorney and adopted before the Domestication process starts.
  • Your attorney or tax advisor will need to draft revisions to your ByLaws to be adopted when the Domestication has been filed.

 

Option 6: Domesticate (Move) your Corporation to your Home State (Get a quote here)

Important Details:

  • The fees and turnaround time depends on your Home State.
  • A detailed fee breakdown and time estimate will be provided with your Custom Quote

Pros:

  • Usually more affordable than keeping your Nevada Corporation: Most states’ yearly fees are lower than the $650 required in Nevada.
  • You keep your FEIN, File Date and company history.

Cons:

  • A “Plan of Domestication” must be drafted by your attorney and adopted before the Domestication process starts.
  • Your attorney or tax advisor will need to draft revisions to your ByLaws to be adopted when the Domestication has been filed.

 

How to Organize Your Corporation or LLC Minute Book

Wednesday, February 25th, 2015

Maintaining corporate or LLC compliance is an essential function that begins with being organized. Ultimately, it’s a job that starts with you, your company’s owner, secretary or shareholders—and it doesn’t have to be difficult or complicated.

One compliance task you can easily manage without having to meet a deadline or pay a fee is getting your company minute book up-to-date. Your company minute book is where you keep all your company’s important paperwork such as your state filing documents and company meeting minutes. As you update certain documents such as stock ledgers (if you own a corporation) or the member ledger for your LLC, you will want to make sure to place the updated copies in your minute book to keep it current. You will also want to keep your minute book handy for inspection at all times (for shareholders, members, investors or even the IRS or state taxation agencies).

If you are organizing a corporation minute book, start out by making sure that you have your original Articles of Incorporation from your state of formation. You will also need the Corporate Bylaws that you adopted during your organizational meeting, and the organizational minutes from that meeting. In addition to your organizational meeting minutes, you will need copies of minutes taken at all meetings including annual meetings and corporate board meetings. For reference to company ownership, your corporation minute book should also contain a stock ledger that shows percentages issued, dates of issue and any transfers of ownership or stock.

An LLC minute book will need to hold the Articles of Organization from your state of formation and the LLC Operating Agreement that was set forth by the LLC members during your organizational meeting. Place both documents in your LLC minute book along with the organizational meeting minutes. You will also need copies of all meeting minutes such as those recorded at annual meetings and any special meetings that were held to discuss company changes. Don’t forget to include a current LLC member ledger that tracks ownership of the company, including the percentage owned by each member.

MyNewCompany.com provides an easy solution to keeping a compliant minute book with a complete corporate kit or LLC kit including a 3-ring binder embossed with the company name, index tabs, sample stock or membership certificates, a corporate or LLC seal with your engraved company name and more. If you are just starting out or have an existing corporation or LLC in need of a perfectly organized minute book, MyNewCompany.com can order a corporate or LLC kit for you today.

Still worried about getting your other compliance tasks done? Consider ComplianceLock™ the peace-of-mind service that 1) sends email and text alerts (SMS) for important compliance due dates, 2) generates meeting minutes/consents with one click 3) monitors the status of your company and 4) securely stores your personal and corporate documents “in the cloud” for safekeeping and instant retrieval when you need them. It’s 4 products in 1 for total entity protection – one full year is easily less than one hour of attorney advice!

How to Evaluate Your Startup Idea (infographic)

Thursday, January 22nd, 2015

Click for enlarged version!

hows-my-startup-idea

 

How to Incorporate in Nevada

Wednesday, January 14th, 2015

Forming a Nevada corporation comes with a number of benefits that might be worthwhile. Nevada corporation owners enjoy a pro-business atmosphere, low-tax mentality and freedom from information sharing with the IRS (opposed to other states that have agreed to share your company information). Personal liability protection, prestige and convenience are some additional advantages to incorporating in Nevada.

To get started with forming your corporation in Nevada, you will first need to confirm that your company name is available with the Nevada Secretary of State. Please note that you will need to include a corporate identifier such as Inc., Corp. or Ltd. You can verify that your Nevada corporation name is available through a search with the Nevada Secretary of State online.

Before you go on to file any paperwork with the state, you will need to appoint a Nevada Registered Agent. Your Registered Agent will serve as your main point of physical contact in Nevada and must be available during business hours to receive official state documents and any other legal papers. If you incorporate in Nevada because you plan to operate your business here and will have a physical office, then someone at that location can serve as your registered agent. Otherwise, you will need to select a registered agent provider. MyNewCompany.com can provide you with a Nevada registered agent for only $99/year and is a member of the Nevada Registered Agents Association.

Now that you’ve appointed a registered agent, you can file your state paperwork. You will also need to obtain a Federal Tax ID and open a Nevada business bank account, and submit foreign qualification paperwork with the state where you will do business if you will not be operating in Nevada. Click here to view further steps for incorporating in Nevada. Please be aware of companies that promise you a Nevada company without having to foreign qualify in your actual state of operation. Virtually every state requires that a Nevada company “re-register” in that state to do business there, so if you are operating in a state other than Nevada, you may be required to pay additional fees.

MyNewCompany.com offers Nevada business filing packages starting as low as $79 plus the state filing fee. All packages include unlimited name availability searches, next business day processing, unlimited phone and email support, the new Corporation Handbook, the Nevada Startup Checklist, free company alerts, free first class shipping and more. Visit MyNewCompany.com or Order Online right now!

 

How to Keep Your Corporation or LLC Compliant

Friday, December 19th, 2014

Maintaining corporate compliance is an important task that you as a small business owner can accomplish by simply staying organized and keeping current with recurring tasks such as holding annual meetings and paying your taxes. Most companies are in fact required by law to fulfill certain tasks on a regular basis and company owners can encounter costly fees, loss of personal liability protection and even company dissolution as the result of losing good standing status.

You can easily maintain your company’s good standing status by starting with the up-to-date organization of your Corporate or LLC Minute Book. Your Corporate Minute Book should hold your Articles of Incorporation, Corporate Bylaws, the corporation minutes from your first Organizational Meeting, the stock ledger that tracks who owns which percentage of the company and copies of all Annual Meeting minutes or Special Meeting minutes documenting all major company decisions.

For LLC compliance, your LLC Minute Book should hold your Articles of Organization, LLC Operating Agreement, the board meeting minutes from your Organizational Meeting, the member ledger tracking ownership of the company and copies of all Annual Meeting minutes and Special Meeting minutes documenting all major company decisions. Keep your current Corporate or LLC Minute Book handy at all times for inspection by the IRS, legal professionals and potential investors or buyers of your company.

To maintain corporate and LLC compliance you will also want to familiarize yourself with all the dates that your compliance tasks must be completed. At minimum your company will probably need to file an Annual Report or other required state filing, pay all federal, state and local taxes and schedule and keep minutes of an Annual Meeting each year.

Annual Meetings are typically required under state law and serve several purposes including providing written records of company decisions, keeping stakeholders up-to-date on company happenings to ensure the safety of their investment and preventing potential problems in the future by getting a written agreement now. Some institutions such as government entities and banks even require documented proof that an Annual Meeting was held before they will do business with a company. To that effect, all meetings should be properly documented.

Does compliance still seem complicated? Not to worry. MyNewCompany.com offers ComplianceLock™ – a service designed for your total entity protection. With ComplianceLock you will get email and SMS text message alerts informing you ahead of time of important compliance due dates, you can generate meeting minutes, consents and corporate resolutions with just one click and your company will be consistently monitored throughout the year to avoid any pitfalls or setbacks.

Get instant access to ComplianceLock™ right now and put your company’s compliance on auto-pilot!

Close Your Business Before the End of the Year

Tuesday, December 9th, 2014

When you no longer intend to operate your business for any reason, it’s important to file the state paperwork to permanently close your company. If that sounds like a waste of time and money, just think about this: Unless you file the paperwork to properly dissolve it, your inactive company will remain an official business entity with the state and you will still be responsible for annual report payments, filing business tax returns and keeping up with any business license or permit costs.

Of course you don’t want to spend time or money on a business you’re not actively involved in. The good news is, you don’t have to. You can properly close your company and officially end its existence by starting with these steps:

  1. Get approval from all company owners to permanently close the company. For a corporation this may require up to two-thirds of the voting shares or a vote of approval by the Board of Directors if no shares were issued. For an LLC, each state has its own dissolution requirements but generally require a majority of the members’ approval.
  2. Make sure that all taxes, fees and reports are current with the state. Some states even require that you are issued a “Tax Clearance” before a dissolution can be filed which takes some time.
  3. File your Articles of Dissolution with the state.
  4. Pay any outstanding debts to creditors and settle any claims.
  5. Cancel any permits or business licenses and notify all local, state and federal authorities that the business is closing.
  6. Distribute assets to the company owners.

As the end of the year approaches, there is no better time to file Articles of Dissolution for a defunct company. The last thing you want after going out of business is to find yourself involved in a messy tax situation from the previous year or still responsible for annual or renewal fees.

We can help you with your state dissolution paperwork and provide a checklist of post-dissolution tasks so you don’t miss a thing. Need to get working on closing your business immediately? Click here.