On Starting a Business in Minnesota
I started a business earlier this year and collected a lot of scattered information in doing so. Here are those notes.
How does this all work..?
I didn’t really know what I was doing as I started the business. After all the research, events, mentor meetings, etc. the single best resource to start with was the Startup Playbook from Y Combinator - http://playbook.samaltman.com/. Reading that and working through my mission, problem, product or service, business model, team, market, market growth rate, and financials was incredibly valuable. I had answers to most every question asked by a mentor or at an event, etc. as a result of this. A giant thank you to Sam Altman and everyone that contributed for publishing the playbook!
I filed for an LLC online at https://mblsportal.sos.state.mn.us. It only took a few minutes and ~$150 to file. Thompson Hall (now JUX.law) has a great series of articles on doing so ( http://jux.law/business/formation/limited-liability-company-llc/ ).
I also filed for an Employee Identification Number online with the IRS ( https://www.irs.gov/Businesses/Small-Businesses-&-Self-Employed/Apply-for-an-Employer-Identification-Number-(EIN)-Online ).
I used a P.O. Box where possible as the address. As expected, I guess, I now get a ton of spam mail from people pulling the on-file addresses from the state and sending spam offers.
Still working on an Operating Agreement & business bank account, but basically every mentor I’ve spoken with has highly, highly suggested having both established early on. I looked at Venture Bank ( http://www.venturebankonline.com/ ) and Silicon Valley Bank ( http://www.svb.com/ ) as options focused on new businesses. Venture Bank is a local company while SVB is rather well established in the startup community and is forming a local branch office down at Industrious.
I’ve been tracking expenses in a simple Numbers spreadsheet, with photos / PDFs of the relevant receipts. Tax Receipts has been a fantastic guide for what to track under which category: http://taxreceipts.com/tax-guide/
Other than gas, car insurance, and personal food & basics, most expenses have been deductible.
Free Business Advice & Help
There were a lot of resources I came across that provided free business advice. The two best ones from my experience were
- SCORE ( http://www.score-mn.org/ )
- St. Thomas Small Business Development Center ( https://www.stthomas.edu/centers/sbdc/ )
The mentors from both were incredibly helpful in asking questions, exposing gaps, sharing experience, and working with me to formally develop a business plan. You can’t beat the cost of free! If your company is software oriented, you can also reach out to Minnesota Emerging Software Advisory ( http://www.mesagroup.org/ ). They provide mentoring advice to companies with at least a Minimum Viable Product built out, looking to grow.
One last mention, I enjoyed meeting with Meda Procurement Technical Assistance Center ( http://meda.net/mnptac/ ). They provide free advice and mentoring to companies looking to work with / compete for government contracts, and at least in my experience, are staffed by a few very sharp people.
Free Legal Advice & Help
Minnesota has a program LegalCORPS ( http://legalcorps.org/ ) that provides free business-related legal advice around the cities at various libraries and similar locations. If you’re at or under a certain income level, they can also provide full representation. The advice clinic I attended was incredibly useful, four lawyers answered every question I could think of and sent me off with a bunch of additional resources to boot.
Potential [Venture] Funding
I haven’t decided whether or not to seek out funding, but while researching everything else I collected links on possible sources for future use. Here are those links:
Most of these also run events and programs, and are worth checking out to see if anything they have going on is relevant. There are certainly a lot of pitch events.
A few other things I did, picked up a domain name ( https://iwantmyname.com/ ), set up a basic webpage with Squarespace ( https://www.squarespace.com/ ), landed at email via Office 365 ( https://products.office.com/en-us/exchange/exchange-online ), picked up business cards from Moo ( https://www.moo.com ), applied & qualified for BizSpark for a whole of ton of free resources including Visual Studio from Microsoft ( https://www.microsoft.com/bizspark ). I looked into a coworking space before ultimately deciding not to use one. There are an ever-growing number of them in the twin cities at various price points, including COCO ( https://explorecoco.com/ ), The Reserve ( http://reserve.work/coworking ), Industrious ( http://www.industriousoffice.com/locations/minneapolis ), and WorkAround ( http://workaroundtc.com/ ). Tech.MN, a great resource for all things tech in the twin cities, recently published a fantastic coworking guide as well - http://tech.mn/wp-content/uploads/2016/04/Ultimate-Guide-to-Coworking-in-Minnesota-2016.pdf.