I mentioned in another thread that funding for a business I’m starting landed recently. I’m super excited.
Wanted to start this thread as a general place to discuss self employment or business ownership.
Taxes, employees, funding, marketing, fees, sales, systems, software, hardware, whatever.
So I’ll get things started.
Choosing a Business
I didn’t like the idea of starting a business from scratch. Too much risk of my screwing it up and losing everything, so I’ve avoided the idea of owning a business even though it’s interested me. Last summer I was approached on LinkedIn by a franchise consultant who offered to explore franchises. I figured it couldn’t hurt. He took an inventory of my skills, interests, and goals, then made a list of franchises that he suggested I consider. Of those 10, I filtered it down to 3 and started meeting with the franchise development rep for each one. I landed on a pool service business that has quick growth, excellent support, and excellent systems in place. It’s not an owner/operator model - the goal is to run it as an executive. My hope is to expand into more territory or another business in 5-10 years.
Funding
For funding, I explored a few options. I could’ve borrowed against the house with a HELOC, but I’d have to tell the bank it was for home remodeling or something similar. Didn’t like that idea. Or get a standard or SBA loan. The interest rates are awful right now and I didn’t want to saddle my business with loan payments right from the beginning.
I ended up going with a ROBS (rollover for business startup) arrangement. Requires a ROBS administrator, and there are lots of them. Steps are:
Preparing for Launch
The best time to launch a pool business in a seasonal market is early spring, so I will launch in March. Now I’m going through initial checklists while still working at my old job and saving some $ for the lean startup time. I’ll leave end of Jan/start of Feb to work out the last few startup items
Wanted to start this thread as a general place to discuss self employment or business ownership.
Taxes, employees, funding, marketing, fees, sales, systems, software, hardware, whatever.
So I’ll get things started.
Choosing a Business
I didn’t like the idea of starting a business from scratch. Too much risk of my screwing it up and losing everything, so I’ve avoided the idea of owning a business even though it’s interested me. Last summer I was approached on LinkedIn by a franchise consultant who offered to explore franchises. I figured it couldn’t hurt. He took an inventory of my skills, interests, and goals, then made a list of franchises that he suggested I consider. Of those 10, I filtered it down to 3 and started meeting with the franchise development rep for each one. I landed on a pool service business that has quick growth, excellent support, and excellent systems in place. It’s not an owner/operator model - the goal is to run it as an executive. My hope is to expand into more territory or another business in 5-10 years.
Funding
For funding, I explored a few options. I could’ve borrowed against the house with a HELOC, but I’d have to tell the bank it was for home remodeling or something similar. Didn’t like that idea. Or get a standard or SBA loan. The interest rates are awful right now and I didn’t want to saddle my business with loan payments right from the beginning.
I ended up going with a ROBS (rollover for business startup) arrangement. Requires a ROBS administrator, and there are lots of them. Steps are:
- Form a C-Corp with the Secretary of State on my state
- Set up a 401k plan run by the c-corp
- Roll over pre-tax retirement funds from a previous employer’s 401k into the c-corp’s 401k
- Set up a business acct at a bank
- Withdraw & from the new 401k into the business bank account and issue stock )1 stock for each $ rolled over)
- Use the $ for your business expenses
Preparing for Launch
The best time to launch a pool business in a seasonal market is early spring, so I will launch in March. Now I’m going through initial checklists while still working at my old job and saving some $ for the lean startup time. I’ll leave end of Jan/start of Feb to work out the last few startup items
- Business errata - PO Box, new business phone number, EIN, DBA letter for the bank to accept payments on behalf of the franchise, etc
- Marketing strategy (which zip codes to focus on?)
- Buy or lease a truck/van, get it wrapped, buy tools & chemicals
- Find a bookkeeper and CPA familiar with ROBS funding and regulations
- Hire an employee
- Go to the weeklong training