Startup algorithm

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Now that we’ve got that whole company name thing figured out, we’re spending some time figuring out the following:
1. Business structure (partnership, c-corp, s-corp, or LLC?)
2. Lawyer
3. Accountant
4. Bank
I’ve found a lot of good resources out there for starting a business, but they all treat these tasks as if they are completely isolated. What I really need is an algorithm for setting up a business. Well, a simpler term would be a checklist, since the algorithm is simple (i.e. non-iterative, non-conditional, and non-recursive), but since I don’t get to code as much as I’d like these days, I find myself wanting to use computer science concepts to explain business stuff whenever I can.
Even though the algorithm is simple, it’s wasn’t immediately clear to me what the steps were. As far as I can tell, it goes something like this:
1. Pick a name
2. Hire a lawyer
3. Hire an accountant
4. Create legal business entity
5. Open a bank account
Of course, it’s not quite this simple, because most of these tasks are actually a set of smaller tasks which require lots of small chunks of time over the course of a few weeks (for lack of a better term, they are sparse tasks). Take, for instance, opening a business bank account. First you need to get some recommendations. Ideally, you’d find two to four candidate banks. Then you need to set up appointments to visit the banks. Then you need to actually visit them, compare the data, choose one, and set up the account. Most of these steps depend on people outside your company, so you’ll do a lot of waiting for people to return calls or emails.
We’d like to optimize this by parallelizing some tasks (and subtasks). But of course some (but not all) are dependent on others.
* Opening a bank account (but not finding a bank) requires having a legal business entity
* Creating the business requires having a name and hiring a lawyer (to advise you as well as help with the paperwork). Also, having an accountant to advise you on tax issues isn’t a bad idea.
We’d really like to be able to pay a lawyer and accountant using a business checking account to simplify our accounting, but that’s not realistic given these dependencies.
For those of you who may (reasonably) be asking, “Um, shouldn’t you be coding, too?”, let me assure you that all this work is also being done in parallel with our technical work. Since all the business setup stuff is sparse, we’re starting it now. That way, it’ll be done in a month or so. In the meantime, we’re starting to get some coding done…
Anything I’m forgetting or getting wrong?
——————————–
Update: Apparently, there are some good small business checklist out there, I just hadn’t looked hard enough. An alert reader sent me these:
* Small Business Notes: Startup Checklist
* Business Know-How: Business Start-Up Checklist
* MyNewCompany.com: Business Startup Checklist
Enjoy!

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2 Responses to “Startup algorithm”

  1. Shawn Says:

    I think you’ve got the first five steps. I think you are missing the final step, which is to sell the corporation to Google for eleventy-eight bajillion dollars.
    I think there are some other steps in the middle, but I don’t know what they are.

  2. Luke Pahler Says:

    Maybe set hard deadlines…so like in school a few days before it’s due you work really hard and stay up till 4AM the night before pumping out the assignment. Also don’t get caught in TODO lists, just-doing is always more valuable…(I should talk I still spend hours with lists, but have learned my folly)
    I actually was in a LLP in College the paperwork was super easy and cheap (like $15/year). But it didn’t buy me anything, maybe the liability of not being as responsible as a Sole Proprietor (which you are automatically) but we were never sued. I see your point with Lawyer before sue = much better off, but you will not be sued until your assets are worth seizing. The EvIL lawsuit people also know you can’t get blood from a turnip.
    PS. I didn’t put my e-mail (ask Dan) because your blog software doesn’t obfuscate the addr.

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