Business

Actions to Take at the Initial Stage of a New Startup

 

Decide a legal structure for the business.

When you are the only founder of your new business (or startup), you may choose between incorporating a limited entity, or a sole proprietorship.

When you are not the only founder (legally) of your new start-up, you may select between setting up a partnership, or a limited company.

When you are a locally formed company, you should not have chosen to become a representative office or branch office (of any head office that is located overseas).

Once you have decided the legal structure, you may go through your Hong Kong company registry with the professional help of one of the local company formation services.

Decide a legal business name for your new company.

Normally you would choose a name that would give you a representation to the industry your business is into. When it is possible, you would want your business name also be available as a domain name, as you would very likely develop and launch a website for your company.

Open a company bank account (that is actually under your legally registered company name)

Usually when you have first started a new startup you may not have any consistent income or any income at all. But you always aim that your business will grow. Before signing your first client and agreeing the payment terms with your client, you should have a company bank account ready to receive any payment.

Also in legal terms your business should have a bank account that is opened under the name of your registered company. Later you will have to do the tax filing (or profit tax return)

Rent an office (or rather a co-working space)

You may start working from home by setting up a desk which becomes your home office. But sooner or later when your startup expands you may need to accommodate your newly hired staffs. You may start considering one of the offices in Hong Kong that can provide co-working spaces. This gives you the flexibility. During the very beginning of your startup, your staffing may be flexible, or unstable. You may actually hire freelancers or part time staffs, so co-working spaces that can let you paying for the flexible hours of rent would have saved you much operation cost.

Write a business plan

It is a good practice to write a business plan even before you actually start the operations of your new business. Why? In your business plan, you would make a list of the high level items you would have to implement. Ideally, you should give each item a timeline (or a deadline) in which you would punctually follow. Stick with the to-do-list and the timeline in your business plan to avoid falling off the track.

The second purpose of this business plan would become a good draft for later use. Especially when you are to meet with angel investors for discussions to possibly funding your start-up.

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