Fun at the bank

On Saturday I went in and got my startup its bank account. I’m a huge proponent of doing this right off the bat, because it makes your life simpler in a million ways. Plus, I opened it with Chase (who I already have a relationship with) and they’re giving me an opening bonus. Yay for bonus.

It was kind of entertaining though because I’d been in the Saturday before, and talked to the small business specialist guy about the account, but since I didn’t have all my paperwork yet, I said I’d come back. So when I came back, the branch was completely empty of customers (as it was the weekend before) but this time there were more employees, who practically pounced on me as I came in the door. Since I live close to a college campus, it’s not too surprising that all the entry-level employees were actually younger than me (and at my age that is rare.) But they seemed genuinely disappointed that I was just willing to wait for the small business specialist guy, who was busy with someone else (who, as far as I could make out, was discussing large, jointed dolls of some kind, but this seemed to actually BE his business. I don’t judge.)

I did get up and deposit a check, figuring I would use the time while I was waiting, and it actually took longer than it would have if I’d used the ATM in the entrance. Chase now has envelope-less ATMs being installed in my area, so you pretty much just put in your card, sign the check, and it scans it. Whereas the teller had me fish out my checkbook to get my account number off it, and fill out a deposit slip. Antiquated, seriously.

Eventually the other non-college-age-guy in the building came out and asked if he could help me instead – it turned out to be the vice president of the branch (I think.) The whole account opening procedure is on computers, which does make me feel somewhat better about the antiquated bits. He wasn’t too sure about some things – we went round and round over whether an LLC is a corporation or not (it isn’t) because he was unfamiliar with the options on the business account opening page. Eventually we got everything set up, just as the specialist got done talking to Dolls Man. I did apply for a business credit card, because then there’s no maintenance fee on the account, but I’m not too optimistic of getting one, since both of the bank guys pretty much said lending has gone down the tubes. Which sucks, because I could definitely get this started faster and better with access to some credit, but I’ll still do OK without it. And an extra $200 won’t hurt.

 

Which came first, the EIN or the LLC filing?

A bit tricky here. In starting a new business, you definitely want to have an EIN (an employer identification number) even if you don’t plan to have employees. It’s basically your business’s social security number, and you can put it on all the official documents instead of your own. Which is very nice if you, like I did with my first business, send out a ton of 1099’s at the end of the year to a customer base that has previously attempted to steal money from you by forging checks with your account numbers. Cute, eh? So I don’t really want to be sharing my personal SSN with the world. You can apply for an EIN online with the IRS and it takes maybe five minutes, very easy.

Where I was circling my tail here is that I wanted to register the EIN using the business’s name plus LLC at the end. But sending in papers to the state of Ohio to file for LLC status (and officially notify them that my business exists) cost $125, and I wanted that money to come out of the business’s checking account, to keep everything nice and neat. But that account didn’t exist yet because I didn’t have the official papers.

What I ended up doing was registering for the EIN first (with the LLC at the end), then sending in the papers with a check out of my personal account, and then going and opening the bank account. Eh, whatever. The only thing that matters is that I have three important things done to officially establish the business: an EIN, its very own bank account (and hopefully a credit card if they’ll approve me for one), and LLC papers from the state. With these things done, it now exists for real.

And since I purchased its domain name over a year ago, this is progress!

 

Step 1: Make sure people want to buy what you’re selling.

I didn’t see the original article where these businesses were profiled, but I see a lot of useful insights in this article. (Plus, I absolutely love it at the end of movies when they tell you how all the characters turned out.)

I enjoy laughing heartily at people who are selling something dumb as much as anyone does, but you know that this Mamaisms Gear woman had to have thought this was a good idea at the time. (My first thought is that one must be very careful in a business where no one wants to buy more than one – and with a line based on quips, including a shirt that says “Mama says quit whining”, you’d better hope none of your friends buy one too, or if you both wear them at the same time you’ll look quadruple stupid.)

But if you look at the other two businesses profiled, those are both offering something that people even in a strapped economy are still going to consider worthwhile. While I am usually quite an optimist, I wouldn’t advise anyone I liked to open a restaurant, but if Sweet Bites is still afloat, the owner is already beating several gloomy statistics and has thus earned her gold stars. If her products aren’t too expensive, she might even get some compensatory business from the “people buy small luxuries when they can’t afford big ones” theory. And the third business, the property management software guy, is offering a product that he believes will actually increase in popularity with a recession. Now that’s diversification.

New article here: Staying in business when nobody’s buying

 

The name’s half the game

Check out this WSJ article about finding out whether your business name is already taken – and if so, what to do about it. This is especially important if your business depends on a domain name – while the GoDaddy bots may suggest you add “the” or “new” or what have you to the name, and some people hyphenate, those are potentially dangerous. If someone’s telling their friend about the great new service she found, and says “You should really visit AwseomeThing.com”, you’ll have some problems if your domain name is actually awesome-thing.com or thenewawesomething.com. And God help you if you went with a .net or .org and you really belong in the world of .com – that’s even harder to remember. When I was trying to come up with the name for the venture I’m working on now, I sat in my boyfriend’s home office with a laptop open to GoDaddy’s domain search page and thesaurus.com, putting in every word I could think of that was even vaguely related to the topic. It took several days and many hours before we came up with something that was not only good, but not already taken. And I still had to go to domain name auction for it – apparently other people had their eye on it as well, because it ended up over $150. I’m hoping that name is worth it. It’s not even hyphenated or spelled weird. Maybe I did get a bargain.