Bootstrapping Guerrilla Marketing Blog

I’ve come across a few articles that mentioned that this blog doesn’t get to the specifics but is more generalized information on how to start and bootstrap your business, so in retaliation (in a good way) I would like to write up a bit about how to get things going on the legal side.

I will skip past the business plans and the fundraising that most will tell you is key ingredients into starting your business and will jump into incorporating your company. Until recently I didn’t know much about this either and just assumed a normal DBA (doing business as) would be well enough. I was a bit foolish I guess.

When you’re creating a business, a DBA for instance will not cover you in a lawsuit against your company. The courts will be able to seize your house, car(s) and so on if your company doesn’t have enough funding to pay the lawsuit. This wasn’t a big concern for me because I believe in being reliable in business but with the amount of people out there who are looking to get something for nothing, I’m wanting to protect myself just in case. Again, if you take a look at My New Company’s website, you can see that their definition of a DBA is also “Fictitious business name” which is something I’m wanting to stay away from now.

There are S-Corporations and regular corporations, but in my opinion and a lot of others as well, an LLC will do you justice. It gives you the legal protection and is very easy to manage. It also doesn’t have all of the corporate formalities. I also like the idea that if I’m sued, the things I own are not going to get taken away from me. My business could fall to the ground, but I’ll be living ok. This might sound harsh and might sound like I’m doubting my company, but in life, certain things come up and sometimes things will happen that you don’t want, or expect, so I’d just as soon be ready for it then fall flat on my face.

My New Company does a good job of explaining exactly what an LLC is in more technical terms if thats reading in a less ‘relaxed’ form is what you’re after:

A Limited Liability Company can be best described as a hybrid between a corporation and a partnership. It provides easy management and “pass-through” taxation (profits and losses are added to the owner(s) personal tax returns) like a Sole Proprietorship/Partnership, with the liability protection of a Corporation. It’s a relatively new form of business created about 20 years ago and now recognized in all 50 States and D.C.

Like a corporation, it is a separate legal entity; unlike a corporation, there is no stock and there are fewer formalities. The owners of an LLC are called “Members” instead of “Shareholders”. So in essence, it’s a like a corporation, with less complicated taxation and stock formalities.

You can read the rest of the description on this page as well as full descriptions of the others.

So, how much does it cost to get setup?

Good question. Now, since this is a Bootstrapping Blog, I’m looking for the best service possible, and thats why I mention My New Company so many times in this article. They are a great website, reliable, and trustworthy which is something we really like around here.

For an LLC to be formed, the cost is $379 in the state of Tennessee, while Ohio is just $204. I don’t think it really matters too much where you form your LLC so I’d suggest going the cheapest state as possible. You can look for yourself on which state is the cheapest.

Here is what you get with the My New Company website when you create your LLC:

• Name Search
• Prepare and File Articles of Organization
• Personalized Organizational Minutes
• Personalized Operating Agreement
• Online Order Tracking and Status Updates
  
• Next Business Day Processing
• Order is Audited for Compliance & Spelling
  
• Unlimited Phone/Email Support
• FREE 1st Class Shipping!
• The New LLC Handbook
• State-Specific Startup Checklist
• Access to Scanned Documents Online
  

They also give you added options you can choose when creating your LLC compan which is great if you’d like some extra bells and whistles added into the package. I personally would never try to do this all on my own and websites like My New Company are perfect for those who are trying to bootstrap their company creation!