6 Startling Startup Costs - And How To Simplify!
So you're thinking about starting your own business. Let me tell you, working for yourself is awesome. Having control over your own schedule. Making your own rules. Hiring your own team. And reaping the fiscal benefits. It'll be a good move--trust me! If you feel like you're ready to take the plunge, you're probably wondering how much it's going to cost you. Here's a bit of a rundown. Every business is going to be a little different of course, but these are the bare bones you're going to need first and foremost.
#1 Big Idea
First things first, you need to figure out what you're going to do. This should be one part what you're good at, one part what you enjoy doing, and a third part, what there's a demand for. You'll want to consider how this business is going to impact your lifestyle, and if you're okay with that. Do you want to run an all-consuming, multi-million dollar conglomerate that sends you to high profile speaking engagements around the world and requires investors and a board of directors and a huge staff? Or do you want to create a family business that allows you to be home with your kids and enjoy more free time?
You'll also want to do some research and figure out if there's a market for whatever you intend to offer. Are there competitors in the space? How many? (You want to see some proof of concept but you may not want to enter a saturated market--that's hard!). Are people willing to pay for your product or service?
Cost: FREE - but remember, time is money, and we do suggest you spend ample time doing your research and thinking this one through to make sure you get it right.
#2 Business Name
Put your creativity pants on and start brainstorming! We recommend selecting a few key people to be in the room with you--think about those that you trust, those that know business, marketers, or people who know the industry or target market--and put up a whiteboard. Your business name is going to stick with you forever, so take it as seriously as you do when naming your children. Once you select your ideal name, you need to make sure you can own it. You'll need to do a search with your local business registry to make sure no one else is using it and register it as your own (we didn't add the cost of a lawsuit to this list, so be careful!). You should also consider taking this one step further and paying to trademark your business name. (This isn't always necessary for smaller businesses, but be sure you do your research and are aware of the potential repercussions if you don't.) And finally, you'll want to purchase an applicable domain name. But more on that later....
Cost: $40 for registration in BC (this varies province to province) + $450 to trademark (not including legal fees that might be required to help you do this)
#3 Marketing Strategy
Marketing is a vital part of starting your business--you need to get your business in front of the right people at the right time, for the right price. Now, you can hire a marketing professional full-time, or you can outsource fully to an agency, but if you're starting off small and are motivated to keep your costs low, you can do a lot of this yourself. There are lots of traditional marketing mediums you could try--billboards, TV, print--but all of these are expensive. With the dawn of social media, things have changed. It's easier than ever to reach and engage with your target audience. "The reason that billboard and bus ads used to work, is that we all walked around looking up. Now-a-days, everyone's looking down, staring at the phone in their hands. So how do you get in front of them there?" Social media marketing is affordable and with all the tools out there to help you manage, it's reasonable for you to handle on your own. If that's your plan, you're going to want to make sure you're doing this right. You will need a customized strategy to ensure your target market and brand tone are defined, and you know how to strategically execute on specific platforms with specific types of content that will work.
Cost: $299 for a custom Social Media Strategy
#4 Professional Headshots
If you want others to take you seriously, you need to present yourself appropriately. A bathroom selfie is not going to cut it in press releases, speaker profiles, your website or your LinkedIn profile photo. It's time to up your game! Hiring a professional photographer to shoot some sleek and impressive headshots of you is a must as you get started.
#5 Digital Storefront
Back in the day, you needed to lease an actual, physical space and put a sign up in the window. Now, depending on the business you're running, this might still be something you need to do (i.e. it's going to be hard to run a coffee shop if you don't have a place for people to come get their coffee), but regardless of your business model, one thing that's a must, is a website. First, you're going to need to purchase a custom domain ($5-$20/year) and pay for hosting ($10-$40/month) -- that you can't escape. To produce a basic website with just five simple pages detailing your products or services, prices, and story is going to cost you about $1500 if you outsource to a professional. If you need something more complex, with booking engines and ecommerce, you're going to see those costs skyrocket closer to $3000 and maybe beyond.
Your custom website, then, will also require said professional to update it whenever you need to make a change, add a promotion, etc which means regular invoices as well. This is going to add up quickly. If this sounds like a lot to you, there is another option. There are easy-to-use platforms out there that we're sure you can master yourself and make building a beautiful site quick, easy and relatively painless. All you may need is a little coaching. (Keep reading for more on that!)
Cost: $1500-$3000 + $5-20/year + $10-40/month + $$$$ for updates and changes
#6 Inventory & Supplies
This is going to vary incredibly from business to business. You may need to rent an office space, buy desks, computers, post-it notes, ball-point pens, highlighters, fax machines, a foosball table, a high-end coffee maker... you get the idea. Or, maybe you're running your business from the comfort of your kitchen table using only your laptop. Perhaps you're selling something and you need to purchase a substantial inventory that you keep in your garage (or a rented warehouse), ready to sell. Whatever your business requirements, make sure that you think through these hard costs from the beginning, so that you have enough money set aside to pay for them. This is a vital component of your business plan and can't be missed. And as always, it's important to try to keep these startup costs as low as possible!
#7 Support Network (BONUS!)
If you've decided to take this plunge, you should be prepared. It's going to be a trying journey! The best way to set yourself up for success is to surround yourself with the right people to keep you motivated, help you dig into problems, offer creative solutions, compare notes with, and even lend you a shoulder to cry on. This will of course fall partly to your friends, your family and your partner, but you should also consider forming some professional relationships that will serve you--because not all of your closest relatives will understand what you're going through, or be able to help. Mentors can be a great asset to you as you start your new business. Having been through a similar experience themselves, you can glean from their experience--successes and failures. It's also worth finding some kind of peer group--in person or virtual--that you can turn to on a daily, weekly or monthly basis. It's amazing how alone you can feel, doing this by yourself, and getting yourself set up with the right people will make all the difference.
So as you can see, your total "startup costs" are likely going to bring you in somewhere between $2500 and $5000. Some of this you can't escape--like registration and domain name fees--but it is possible to simplify this a little!
Our Startup Weekend Intensive program is a 2-day workshop where new entrepreneurs can come together to build their own website (that will be easy to manage as you grow), get some professional headshots taken, and build a custom social media strategy (and learn how to manage themselves). You'll be in a room with 10-20 other entrepreneurs in the same boat as you, that you can brainstorm with, get to know and that you'll keep in touch with after the fact. This is your support network!
Our first workshop is running this January 21-22, 2016 in Vancouver, BC. Register before December 20th to receive an Early Bird discount of $250.
Start your new year off right with us!