Startup Team

Hiring an Independent Contractor or Employee

Posted on Tuesday at 12:00

It is important that you know the difference between hiring an independent contractor vs. an employee so that you can determine which is best for you and your business. Before reviewing the pros and cons of each, start by gaining an understanding of the differences between the two:

Independent Contractor

Operates under a business name other than your own
Operates as an employee under that business name and therefore limits your ability to control the contractors tools, processes, hours, etc
Maintains a separate business checking accounts
Represents the contractor’s business name and advertises his/her services as such
Invoices for work completed
Likely has more than one client
Keeps separate business records

Employee

Performs duties and responsibilities as dictated by you and your company
Requires added responsibility such as training, support, health benefits, management, etc.
Works for only one employer, your business

With a brief understanding of the differences between independent contractors and employees, you can begin to think of the benefits that each present.

Independent Contractor

Often cheaper in terms of associated labor costs and overhead
No health benefits are required
Flexibility in regard to only hiring when works is demanded of your company, especially for businesses that are seasonal or experience fluctuating streams of business
Reduction in liability
More flexibility in regard to hiring and firing

Employee

Stronger sense of loyalty and dedication
Employees can perform a variety of roles
Improved work flow, especially for businesses that experience a steady stream of business

It is important that you take the proper legal steps when hiring an employee or independent contractor and ensure that you hire them under the correct legal classification in order to avoid costly legal consequences down the road.

Tags: Business Plan, contractors, employee, employees, Employer, firing, Guide to the Startup Phase, hiring, How to, independent contractors, Operating Expenses, Startup Team

What to Consider When Starting a Company With Your Spouse

Posted on Thursday at 12:00

Starting a business can be a risky endeavor (quitting your job, spending your savings, good potential for failure, and the list goes on). Starting a business with your spouse can be even riskier when you consider your shared finances, your retirement funds, your relationship, your mental health and happiness. Before you risk everything, ask yourself the following questions:

Are you willing, able and ready to work together? For any successful business, you must have a proper business plan. Part of this plan should outline ownership, roles, responsibilities, etc. Be sure that you and your spouse have a very clear understanding of each of these areas of the business. The more that you can divide your roles and responsibilities in different areas of the business, the better you will be able to share power and minimize arguments.
Can you mesh your personal and business lives seamlessly? Be sure to draw boundaries so that you maintain some semblance of your romantic life. Furthermore, make sure that you both have enough room to work so that when one is working with clients, or needs personal space or room to think strategically, there is not a conflict. Lastly, make sure that you have developed an effective way of airing differences and resolving disputes. You certainly will not see eye-to-eye on all aspects of the business. The better system you have for managing these discrepancies, the more successful you will be at doing so and the happier you will be with one another.
Are you clear with one another on what financial risks each is willing to take? There is a good chance that you will not see eye-to-eye in terms of when it is time to call it quits. By discussing your financial runway with one another and having a mutual understanding of when it is time to quit, you will save the headache and potential fallout down the road.
Lastly, ask yourself, what comes first, the relationship or the business? If and when times get tough, one of you may face the decision of having to lose the business to save the relationship. Determine when enough is enough.

Even if you think you know your answers as well as your spouse’s answers to all of these questions, it is wise to sit down together and have an open discussion. Whether you determine that you are on the same page and ready to push forward, or you find that you have too many differences and that it would be too risky to go into business together, this is a worthwhile practice that will help mitigate any potential risks associated with starting a business with your spouse.

Tags: Business Plan, How to, Legal, Pre Launch, spouse, starting a business with a spouse, Startup Team

Helpful People to Have On Your Non-Profit Team

Posted on Monday at 5:00

Chances are you do not specialize in every area of business necessary to get your non-profit organization off the ground. There are some people with whom it will be necessary to ask for or hire for their ability to help you.

Mentor

As much as you read about starting a non-profit, it will always be helpful to have access to someone who has gone through the process before. Hopefully you already have someone in mind to talk to, but if not you can look up another non-profit manager in either your local area or in your field of non-profit on Council of Nonprofits, or do an internet search to find more non-profits in your area.

Attorney

Although you probably prefer to resolve business issues on your own, some issues are more efficiently dealt with by an attorney. Some attorneys specialize in working with non-profits. Ask your mentor or anyone else you know in the non-profit world for suggestions. A recent shift in the legal world is the increasing presence of lawyers who are willing to work with you collaboratively or as a coach, rather than the traditional “all-or-nothing” approach. Make sure to ask a prospective attorney if they would be willing to help you collaboratively if that is something you are interested in doing. It might help you save money on legal expenses.

Accountant/Tax Professional

If you qualified as a 501(c)(3), tax deductions are both a huge benefit financially and a significant amount of paperwork and time. Especially if you are a new non-profit, it is important to ensure tax filing accuracy to avoid delays or the revocation of your 501(c)(3) status. Having this paperwork completed or reviewed by someone who specializes in it may be a necessary expense.

Tags: Startup Team

Build an All-Star Startup Team

Posted on Wednesday at 11:44

You have a great new business idea. As it forms into a plan, decisions will be made around how to support business functions necessary to succeed and if you should plan to assemble a team.

Know what you have, determine what you need.

Create a clear outline of how the company will develop as an organization. Understand your goals and format them to support a strong mission and vision. What skill sets and abilities are necessary for your business to succeed? Of these, which will you not be able to fulfill? Gain a clear understanding of yourself, your competencies and shortcomings. As resources will most likely be initially limited, understanding which functions and abilities are the most critical will allow you to target and bring on a team member that will bring the most value to the business.

Once you have defined the position, it is time to look for the best candidate. At the startup level, traits including inventiveness, ambition, and autonomy should be heavily weighted. Look for people with experience in relevant fields, interest in startups, and an ability to perform across functions of the business. The ideal candidate will be driven to achieve the goals you have set and share passion for the success of the company.

Networking and becoming involved in the community – online or offline – are good places to start when looking for the right people to create your team. Your own social network is a valuable tool. Communicating an enthusiasm for your new business will often attract people with entrepreneurial drive.

It is important to build a team with personalities that complement each other. However, your first few additions should have skills different from your own with backgrounds crossing business functions. Your goal is to create a solid foundation for your business to grow.

Tags: Business Idea, Pre Launch, Pre-Launch Actions, Startup Phase, Startup Team