Many side hustles today started on a whim or thought. Likewise, entrepreneurs, today started by working on the side or creating hobby businesses. However, side hustles cannot always stay on the side forever. What happens when it is time to take that side hustle to the next level? If you seek to grow your brand and make a passion project into a booming enterprise, there are some steps entrepreneurs need to take.
Steps to turn a side hustle into a booming enterprise
Below are some outlines detailing the requirements.
Create a plan
Legal and official steps to running a business can be overwhelming for someone who started a hobby business. However, it helps to map out a plan you can break into small pieces and manage. Turning a small business into a real one can be daunting. Take a step back and evaluate legal steps and plausible structures.
Develop a business model
In addition to a business plan, starting entrepreneurs should have a business model that outlines how to plan, make money, and grow the business. This model will evolve, but the beginning is essential to stable growth.
Check name availability
Create a company name that stands out. When you take any official step to register your business, you will need a company name. It is paramount to use something fresh and available to avoid delays and legal troubles.
File a DBA
DBA – Doing business As. This is to reserve a brand name. Starting as a sole proprietor is possible when running a business independently. This may change in the course of the business growth. Sole proprietors with a DBA are an option as it is quick and affordable. A DBA doesn’t separate personal and business assets and liabilities, which can be risky.
Choose a structure
There are many options for choosing a business structure. To help limit personal liabilities, SME owners choose to form LLC (Limited Liability Company). LLC requires less record-keeping than a corporation, avoids double taxation, and allows owner flexibility.
However, another option of seeking investors doesn’t allow the company to do business as LLC; a corporation might be the better choice. Corporations are recognized internationally and have the option to provide preferred shares of stock.
Check state and local business licenses
Aside from federal regulation and licenses, states and local governments may have legal requirements for new businesses. Check your city and country government offices and browse the state website to find any additional licenses you may need to comply with.
Check Industry licenses
There are some legal and licensing requirements for businesses in a particular industry. It is vital to check with industry associates or legal professionals to learn about a specific business model requirement.
Consult with a professional
Consult a professional for more personalized advice. Speaking to a business attorney might also be a good option.
These hacks help entrepreneurs have stress, and trouble-free legal growth for their side hustles transitioning into real businesses.