Starting a new business can be an extremely exciting time. But have you considered some of the challenges that you may face before getting your business off the ground? Here are some common challenges for new startup businesses.
When does my business start?
A business exists when there is a reasonable expectation of commercial gain or profit. Either way, we recommend that you hang on to all your receipts and expenditure, because there might be a way for us to claim back pre-trading expenses.
Sole Trader vs Limited Company
A sole trader is cheaper and there’s less administration, but particularly for video games companies, there’s Video Games Tax Relief, which is only available for limited companies. Check out our article Sole Trader vs Limited Company for a more detailed breakdown of the pros & cons of each option.
Now that you have your business, you might ask about funding. Funding for startup companies isn’t easy. You have no credit history or track record. We recommend that you stay close to home. Do you have friends or family that can help you out? You might consider working for hire. This will help you build up cash, gain commercial experience and get those industry contacts.
Building a team
With all that in place, you’ll need a team. You may already have a team from university or college, but working in a commercial environment is very different. We’d recommend that you get a legal agreement in place, which will consider things like roles and responsibilities, the share of profits and what happens if one of your team leaves? Consider subcontracting versus employment, it’s more expensive in the short term, but it gives you more flexibility over your team. You’ll probably need advice on HR and payroll and there are legal requirements here that can be complex.
Facing hard times
With your business up and running, you’re going to face good times and bad times. It’s important to ask yourself how you can stay positive and focus through those bad times? Do you have a strong support network you can rely on? Do you have a mentor who’s maybe been through the industry and can offer advice? It’s important that you maintain a good work-life balance so that you can stay in a positive frame of mind.
Balancing operations with strategy planning
With your business in place, it’s important to focus on your operations, get that product built, meet those deadlines, but these are all short term goals. It’s also important to focus on strategies so that you can align those short term goals with your long term objectives.
These challenges will all be unique to you. We recommend that you keep in touch with your industry, attend industry events, read industry newsletters, keep in touch with your peers. We can help you. We have specialist teams in accounting, tax, business solutions and corporate finance. If you’ve got any queries, then email Stephen Bain (email@example.com) or complete the contact form below and a member of our team will be in touch with you soon.