What Makes a Business Legit
I told you I was shaking things up, didn’t I?!
Last month, I shared that I’m doing things differently…. again.
I’ve always prided myself in “going first” — the first in my law school class to say SEE YA to the industry, getting the then-unknown iPod so I could jam out while flying to China to play volleyball when I was 16, and then going against what everyone told me I “had to do” to run an evergreen business.
Today, another first: a sponsored newsletter. Every once in a while, you might see a company sponsor this always-free-to-you newsletter filled with legal and business tips, like you’ll see Morning Brew do today below.
I will never share anything that doesn’t align or that wouldn’t be helpful to you.
Me & the team put loads of time, attention & energy into this newsletter (2x per week!) for you. So we really appreciate your understanding and support for our occasional sponsors so we can keep these free legal knowledge bombs dropping in your inbox. As you’ll see – it’s not that invasive anyway.
Hopefully you don’t even mind because you love these emails 🙂
Have you liked these new Q&A emails lately? Do me a favor and comment below to say “yes!” if so.
Got a question you’d like me to answer in a future email? Hit “reply” and let me know. I’m loving the ones I’ve gotten already.
Let’s jump into our legal Q&A sesh! 👇
The Question //
At what stage of the business building and planning process should a Solopreneur mindset life coach in the just getting started stage of business who has no audience, list, offers, or market reach yet (but is very active on social media) apply for a FEIN, get a business address, business bank account and form a LLC?
The Answer //
Great question! How’s yesterday sound? Just kidding, sort of.
So first we’ve gotta clear up 1 big myth out there when it comes to legally protecting your online business:
MYTH: That you wait until your business makes money, has followers, or clients to do something to officially form and protect your business.
TRUTH: Legally protecting your business has nothing to do with how successful it is today.
Instead, I want you to think about 2 things:
Are you ready to take on a client, if someone contacted you? Are you marketing your business already? (don’t focus on how successful you feel your marketing is)
Where do you want your business to be 6 months to 1 year from now? Would that business need legal protection?
If the answer to #1 is “yes” or to #2 is “somewhere better than where I am now” then you need to:
- Form your business (ie, get a LLC, sole prop etc)
- Setup your business bank account
- Get a client contract for the service/program you’re offering
- Right before you work with any client/sell anything: get business insurance
Ideally, these steps would be the most important part of your start-up budget. Because without them, you can’t really get started on the rest of building your business.
I know some people will tell you “don’t worry about this stuff! Just get started!” but that’s just not true or safe.
There’s no “get out of jail free card” for not having legal protection in your business because you’re new or not super profitable yet. Unfortunately, legal’s just part of starting a business.
I know budget can be tight when starting up (I sold lots of my stuff on Poshmark, ThredUp, eBay etc & took on a part-time job to fund the start up of my business!) so I’ve got loads of free resources for you:
- Overwhelmed about the legal steps you need to take to protect your business? I break down where to start in Episode 7 of On Your Terms.
- Download my brand-new (free) Legally Legit™️ Biz checklist to knock out these steps, with me by your side. (No opt-in req’d!)
Hope this was helpful! Drop in the comments if it was! 🙂
PS: This week, I chatted with Jen Diaz – mindset & success coach – all about imposter syndrome, believing in yourself, visualization techniques, journaling, and limiting beliefs. Dive in by listening to my pod, On Your Terms, Epi 56 here.