[ScottFree]

Am I the only one here that finds it odd that not a single response so far has included a book on the nuts and bolts of how to start and operate a business? How and where to register the company, how to keep payroll, how to hire/fire, how to pay taxes, how to generate and read P&L sheets, etc.

Has anybody here read Small Time Operator: How to Start Your Own Business, Keep Your Books, Pay Your Taxes, and Stay Out of Trouble? It's the only book I've seen that even claims to address this stuff, but I don't know if it's worth the time and money to buy and read.

[josephjrobison]

I own that book and it’s good to have as a resource. Rather than read

I bought “Finance for Non-Financial Managers” and like that better for the clarity and humor on the financial side of things.

I would say both are good for an overview - it will make you realize where you need to learn more and dig in.

For even more I’d recommend “Profit First” and “Simple Numbers...”

[ScottFree]

Thank you for the recommendations! I'll check those books out.

[nojvek]

Stripe atlas is good for registering a LLC company in the US, they have a bunch of other things and send you weekly emails like a little course.

“The hard thing about hard things” is a pretty good read too. It has a decent chapter on hiring and firing. The book is a great roller coaster ride.

However most of the stuff you learn on the journey. Just start with something. One can get pretty far without registering a business.

[redis_mlc]

> Am I the only one here that finds it odd

1) In the US, for a pre-employee startup, you actually don't need to do anything at all to start a company initially. Especially if you're a solo founder (sole proprietor.) Just register your domain, develop your prototype and start marketing and selling.

Your bank will let you deposit one or 2 checks into your personal account regardless if it's to your company name.

2) If you later want a bank account with a company name, you need to:

- first register a DBA (doing business as) name locally

- create a bank account in that name.

Note that banks generally don't enforce 2-owner accounts, so if any founder has a check, they can draw on the company account themself. (The bank officialese is, "that should be defined in your articles of incorporation.") Also, I haven't seen any advantages with SVB, so just use a bank you're familiar with.

3) For taxes, as a sole proprietor, if you want to add a Schedule C for that company name on your personal tax forms, you can do that (just use separate personal and company receipts and ensure revenue is greater than expenses if you want to deduct the expenses.) But I'd recommend just keeping expense spending to a minimal amount and not bothering with the Schedule C for the first year or two.

4) If you want to incorporate, use Stripe. There's no reason to do so before you get investors, so don't. They will probably make you change your paperwork anyway later. You're not shielded from liability except under strict conditions.

5) For your first "employees", make them contractors. You will have to 1099 them if over $600/year. So for small stuff, keep that under $600/year.

Some clients will require a DUNS number.

Some clients will ask for permission to debit your account to clawback invoice payments. Don't allow that.

If you want to hire employees, that's more complicated, but you can use Gusto or whatever HR/Payroll cloud service these days. However, it's unlikely an early startup can afford even one employee. (YC likes multiple founders because they're free staff.) The only thing you can do very wrong legally is to fail to pay employee witholding deductions.

6) The parent poster mentioned a lot of overhead activities. If you're a new businessperson and don't see red flags with that, have somebody explain what "overhead" means.

7) If you have recvenue and want to hire a CPA or bookkeeper, the one question you can ask to see how competent they are is, "So how do R&D tax credits work with software development?"

8) I discussed US, and Canada is similar. Europe is very different and requires things like advance pension payments of around a million euros, so YMMV.

9) If you need affordable web design or QA, let me know and I'll share my contacts.

[opportune]

I could be completely wrong here, but isn't it a pretty big risk to start doing actual business (i.e. selling your stuff for money, using your personal bank account to cash your business' checks) before you incorporate? Because at that point, if there is a legal dispute can't you be held personally liable and get really screwed?

I'm imagining a scenario where you have some sort of SAAS that a customer uses, then there is some issue (could be real, could be made up or the customer's fault, but I doubt a court could tell before trial) and the customer sues you for some huge amount of "potential lost revenue". Just the pessimist in me talking, but I'm pretty sure I've read before about things like this. Incorporation is so cheap, I don't see why you wouldn't just do that right before you start doing actual business to protect against this scenario.

[redis_mlc]

> Because at that point, if there is a legal dispute can't you be held personally liable and get really screwed?

1) If you're one guy, it's pretty easy to "pierce the corporate veil."

2) Investors normally have you redo the paperwork later.

3) If you're squeamish, don't do a startup. Your customers don't care what you spent on paperwork.