Learn how to form your own business - full 2021 guide

Which one are you?

Which one do you want to be?

Remember, it's all about when you are taxed.

It's that simple.

Businesses have it better.

So if you're a business owner - you already have it better - so let's take advantage of it!

Action Steps:

• Remember the most important lesson - it's about when you pay taxes.

• Teach someone else this concept.

Get these books!

Click here to get Rich Dad Poor Dad - https://amzn.to/3rSWWXl

Click here to get Cashflow Quadrants - https://amzn.to/31KYJDo

All by Robert Kiyosaki

Give them to someone else when you finish them.

If you're like me and you'd rather listen...

Download Audible and get them on audiobook - https://amzn.to/3mMW98k

Action Steps:

• Order Rich Dad Poor Dad.

• Order Cashflow Quadrants.

This is an important step!

Even if you don't know all the answers yet.

Seriously, write as much as you can for each section

And save your newly completed business plan.

Action Steps:

• Open the legal docs folder you downloaded from video #1 and find the business plans folder.

• Open the file named "Sample_business_plan_-_wooden_grain_toy_company.doc".

• Follow along with me and save a copy of your business plan when you are done!

If you want additional examples or to find the originals check the link below!

Link to SBA - business plans - https://www.sba.gov/business-guide/plan-your-business/write-your-business-plan

This is for when you have an idea and you want to get it on paper!

It really helps get the idea out of your head and into a place where you can shape it.

Write at least 1 sentence per section.

I use the lean business plan all the time:

• When describing my company to an investor.

• To refer back to our mission.

• To make changes to our mission.

• When the bank asks to get a loan.

• It really makes you look like you have your sh!t together (because you do).

• Peace of mind.

Save this with your company documents that we create for the rest of this course.

Action Steps:

• Open the legal docs folder you downloaded from video #1 and find the business plans folder.

• In this video, we are using the "Sample_lean_business_plan_-_wooden_grain_toy_company.doc".

• Follow along with me and save a copy of your lean business plan when you are done.

If you want additional examples or to find the originals check the link below!

Link to SBA website - business plans - https://www.sba.gov/business-guide/plan-your-business/write-your-business-plan

The most overlooked step.

It's so damn important too!

Even if you are unsure of the numbers

GUESS

Action Steps:

• Open up the legal docs folder.

• Find the file "Startup_costs_worksheet.pdf" and open it.

• Find the file "BreakEven.xls" and open it.

• Follow along with the video.

• Complete as much as you possibly can - pausing to lookup costs.

This exercise gives you so much peace of mind and perspective - it's insane!

You owe it to your future self to be thorough here.

Knowledge is profit.

SBA business startup calculator - https://www.sba.gov/business-guide/plan-your-business/calculate-your-startup-costs

A very common question is:

How do I get money to start?

I started Scorch Marker with $500.

My wife agreed to let me spend it to try and make our idea real.

We sold 1 in 3 months.

A few months later we sold another.

Then we tried harder and put some sweat equity into it.

Every dollar we earned, we reinvested.

We did 1 million in sales in our third year.

You can bootstrap a company.

You just need to be crafty and smart about it.

Here are some things that if you master - will really help you get money faster.

By learning how to do the following:

• Set a budget and stick to it.

• Set aside a % of your income.

• Spending money to invest in yourself.

• Reading daily.

• Educating yourself on money.

• Spending free time earning (flipping - overtime - 2nd job).

• Learning a high paying skill that you can teach.

• Cut out the bullshit and focus on you.

These skills will help you save the money needed to start.

They will also help you be SMART with the money when you get it.

Action Steps (download and read/listen):

• I Will Teach You To Be Rich - https://amzn.to/3dQTkBE

• Richest Man in Babylon - https://amzn.to/3dKR2Uu

• Money, Master the Game - https://amzn.to/3esVmqr

Last but not least:

American Express card that I love - http://refer.amex.us/EVANV927B?XLINK=MYCP

Credit Cards with 0% interest that I use - https://www.referyourchasecard.com/21f/9JC23UHZ59

It's not that important

Choosing a name that is.

The reason is that you can always file a DBA and do business under another name.

So don't let the process of choosing a name hold you up.

Do it swiftly and smartly.

Follow along and you'll know exactly what to do :)

Here are the links I mentioned in the video:

namelix.com - AI name generator - namelix.com

namechk.com - check all social media and websites - http://namechk.com/

ICANN lookup - Internet corporation for assigned names and numbers - https://lookup.icann.org/

To find the Secretary of State Website that applies to you:

• Download the PDF on this page.

• Use the PDF to find the website needed for YOUR state.

• This will allow you to search for YOUR business name in YOUR state - because names are state-specific.

Action Steps:

• Write down a bunch of acceptable names.

• Cross off names to narrow it down. Use the links above.

• Select the name of your company!

Good job!

This is a big step :)

Remember, you can always file a DBA and change it!

Most people are OK as sole proprietors.

But you can't change your tax status to an S-Corp if you remain a sole prop.

Only LLCs, Corps, and Partnerships can become S-Corps.

So...

The BEST choice for MOST entrepreneurs is LLC taxed as a Sole Prop until they make $50,000 or more in profits.

Then we change the tax status of the LLC from a sole prop to an S-corp.

But more on that later!!

Action Steps:

• Go teach someone this concept and make sure they understand it

For some of you sole prop is best.

For others, a partnership is best.

I made fillable legal docs for both.

Action steps:

• Download and fill out the partnership agreement (if you chose LLC taxed as a partnership)

The partnership agreement is contained in your legal docs folder - it is also available to be downloaded again on this page in PDF and DOCX

If you chose LLC taxed as a sole prop, we are going to go through the Operating agreement together - in later videos

This is the part you've been waiting for.

Just a little bit longer and we can form your LLC!

Action Steps:

• Download the list of Secretary of State offices on this page. Use it to find the website you need for YOUR state.

If you are doing business in Texas, look up the website for Texas.

Same thing for California, Utah etc.

What's a registered agent?

Simply put, it's someone always available to accept mail for the company.

It's best to have one. Privacy is important.

Don't sign up for a registered agent during this video, if you use INCfile to form your LLC you get 1 year free.

Wait until we finish the lessons before you get your LLC.

INCfile.com - https://www.shareasale.com/r.cfm?b=617326&u=2850682&m=53954

The terminology is the same.

The LLC formation process is slightly different with every state.

But the same steps are required.

If you want to skip this step you can.

Form your LLC online with INCfile

https://www.shareasale.com/r.cfm?b=617326&u=2850682&m=53954

But I suggest you follow along with me and do it yourself.

It's an important skill to learn. You will probably do it again.

Action Steps:

• Using the office_location.pdf on this page (or the one you opened in the last video), find your secretary of state website.

• Go to the website.

• Find the section where you form an LLC or file articles or organization.

• Follow along with me while we fill it out correctly.

It's OK to use your name and address as the company address.

If you want more privacy and don't want your address public, you should look up a registered agent.

Do a simple Google search for "registered agent my state" and find one that charges less than $100 per year that also opens, scans, and emails your mail to you.

You got this!

You can always form your LLC online with Nolo.

https://www.tkqlhce.com/click-100326934-13650331?url=https%3A%2F%2Fstore.nolo.com%2Fproducts%2Fonline-california-llc-ptlca.html%3Futm_campaign%3Dproduct-feed%26utm_medium%3Dmerchant%26utm_source%3Dgoogle&cjsku=PTLCA

Make sure your LLC name and EIN names match!

The IRS and the state don't talk so make sure they match.

Sometimes it's wise to hear back from the secretary of state first - in case there is a name conflict or issue.

Otherwise - it's totally OK to get your EIN right away.

Here are the links you need:

Get your EIN for free from the IRS - https://www.irs.gov/businesses/small-businesses-self-employed/apply-for-an-employer-identification-number-ein-online

Pay INCfile to do it all for you - https://www.shareasale.com/r.cfm?b=617326&u=2850682&m=53954

Action Steps:

• Follow along with me and fill out your EIN paperwork.

• Save the document in a safe place. I keep it with my company documents on Dropbox.

Now that you know how to do it

It's time to learn how to pay someone to do it.

Sometimes it's worth it to have it all done for you.

I've used them all. Nolo is my favorite.

Pay NOLO to form your LLC

https://www.shareasale.com/r.cfm?b=617326&u=2850682&m=53954

If you already filed your LLC then you don't need to take any action here.

If you haven't filed your LLC and the registered agent is holding you up, watch this video, follow along and get it done!

This is the 2nd of the two documents every LLC needs

Operating agreements are crucial.

But to be honest - you are going to fill this out and put it in a drawer.

Or save it on dropbox and not look at it again until...

you get sued, audited, sell or die.

Make sure it's there before you need it.

Action Steps:

• Go back to the legal docs folder you downloaded from the first video and open the "operating agreement" (you can also download it on this page if you don't have it handy).

• Fill out the operating agreement along with me - use the DOCX version if you want to add or remove sections with ease.

• If you want to add additional info - simply type up another page and attach it and sign it.

• If you want to remove anything or change it - do it! this is YOU operating agreement and can be as simple or as complex, as you like.

Keep it simple.

I think you're a really cool person by the way.

I'm also very proud of you ?

A DBA is a nickname.

You can attach an EIN to a DBA.

Or you can simply use a DBA to nickname an LLC.

They are easy to file - but they must be done correctly.

Expect to spend $50-$100 to do this.

The process takes 2-4 weeks.

You should receive proof in the form of a Fictitious Business Filing or proof of Doing Business As.

Need a DBA?

Contact James Greene Attorney at law.

James@hustlefullthrottle.com

The secret is to keep things separate.

You don't need separate LLCs.

You don't any more companies.

You need separate bank accounts.

Separation helps keep things in order so you can save more money on taxes.

You can do this with a phone call or a few emails.

Don't let the banking system intimidate you.

They use the money you deposit.

So trust me, they're getting a good deal.

You should too.

Often local credit unions will give you a human to connect with.

That's what I like about local credit unions.

Action Steps:

• Google Search for local credit unions in your area and go to their business banking webpage.

• Call the number and tell them what you want and what you have (it's in the journal above).

You can have more than one bank.

I also use Chase. I use them a lot.

They have the best online portal and they are the best in terms of integration.

They are also the largest.

Chase talks to everyone.

You can do almost anything online and never need to step inside a branch.

That can be very useful.

Action Steps:

• Find the closest chase branch and see if they are an option.

• Call the number and tell them what you want and what you have (it's in the journal above) you can also visit them.

Here are some useful links:

Chase credit cards with 0% - https://www.referyourchasecard.com/21f/9JC23UHZ59

The fully online option.

I personally have not used Bluevine - but I have heard good things.

The important thing to know is that they exist.

Find the system that works BEST FOR YOU.

Bluevine - https://vanader-growth.mykajabi.com/products/vanader-business-school/categories/2147597153/posts/bluevine.com

or you can use hatchcard.com for super easy business checking

Credit cards and savings

That's how most businesses are started.

Luckily I found the BEST credit cards to use for this.

Chase offers business credit cards with great perks.

I used these two cards to build Scorch Marker.

1. Chase business credit cards - https://www.referyourchasecard.com/21f/9JC23UHZ59

2. American Express business cards - http://refer.amex.us/EVANV927B?XLINK=MYCP

Here is how I did it:

• Only carry a balance when the interest rate is 0%

• Use the credit cards to purchase inventory, equipment, or resources needed to make money

• Treat the Credit Card as a powerful weapon that can burn you if abused (because it will)

• Use the 2% cashback points to reinvest into the company or pay yourself.

• When the 0% expires, pay off the statement balance in full every month (16% interest is way too expensive).

• Once you use 1 credit card for a year and the promo expires - open a second one.

• This will give you 2 years of 0% balances to work with.

• BE SMART! DON'T SPEND WHAT YOU CAN'T PAY BACK.

Remember - you will have to cosign on these credit cards - so there's no free lunch.

The most important step is...

Getting a Dunn and Bradstreet number.

This way you can begin the credit reporting process.

It's free so there are no excuses.

Credit is important so just start building it now.

Action Steps:

• Apply for a DUNS Number

• Save the DUNS number in a safe place - near your EIN

• Use Uline for some basic purchases - NET30 terms!

• Pay them back immediately by writing them a check! (online is ok too)

Here are the links you need to make it happen:

Chase 0% business credit cards - https://www.referyourchasecard.com/21f/9JC23UHZ59

uline.com - uline.com

Get a DUNS number - https://www.dnb.com/duns-number/get-a-duns.html