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What Does It Take To Turn A Summer Side Hustle Into A Small Business? by @DeborahSweeney

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Summertime and the living is easy — especially when business is booming from your side hustle! If you’ve been running a successful summer side hustle for a few years now, you might want to consider spinning it off into a full-time gig.

What does it take to turn a side hustle into a thriving small business? It’s a much less intensive process than many entrepreneurs may realize, and follows certain step-by-step guidelines. Take a look at the best ways to prepare your side hustle to become its own year-round small business.

1. Draft a traditional or lean business plan.

You might have already created a lean business plan for your side hustle. If that’s the case, it’s time to add more details about the business. If you don’t already have a business plan, it’s also the time to draft one.

Most entrepreneurs choose to draft a traditional business plan or a lean startup plan. The format decided upon often depends on the needs of their business.

Consider a summer side hustle that has been around for several years. It has a proven track record of steady cash flow and offerings that continually appeal to consumers. As this side hustle pivots into becoming a full-time small business, a traditional business plan will provide an objective look into the company’s future.

A traditional business plan outlines the following areas:

  • Executive summary. The ability to explain who you are, what the business does, its industry, location, how it makes money, and why consumers want these goods and services.
  • Business description, concept, and strategy. What do your products and/or services do, and what makes them unique?
  • Industry analysis. A thorough analysis of your brand’s competitors.
  • Market analysis. A thorough analysis of your brand’s target audience.
  • Organization and management. The core responsibilities of your team members (if you have any employed).
  • Financial projections. Tables that provide information about cash flow, projected profit and loss, and a break-even analysis.
  • Financing request. A section specifically created for businesses seeking funding from investors.
  • Other additional information as it pertains to the company, like letters of incorporation and trademark registration documents.

A lean startup plan is a little less intensive, but covers these key areas:

  • Value proposition. A clear statement summing up the value your business brings to its market.
  • Key partnerships, resources, and activities. Information about any partners your business may have and resources that allow the business to create value.
  • Customer segments, channels, and relationships. The ability to define your target audience.
  • Revenue streams. How the business is able to make money.

2. Incorporate the business.

Incorporating a business, even one that starts off as a side hustle, provides the company with tons of valuable benefits. It allows you to build credibility much faster than businesses that do not incorporate, which shows customers that your company is legitimate.

Entrepreneurs may choose from a variety of entities to incorporate their side hustle turned small business. Some of these may include sole proprietorships, partnerships, corporations, and limited liability companies. LLCs, or limited liability companies, often tend to be quite popular with entrepreneurs. The entity is flexible in terms of management and also provides liability protection. This acts as a safeguard between personal and professional assets. In the event of an unforeseen circumstance, like a lawsuit, liability protection ensures that your personal property like cars and houses will not be impacted.

3. Register for trademarks.

Earlier I mentioned that trademark registration documents are generally kept in the appendix of a business plan. Chances are pretty high that your side hustle may have a unique name, phrase, symbol, design, or logo associated with it. This unique mark differentiates your business from competitors. However, if you do not register a trademark the unprotected mark may end up in the wrong hands and be plagiarized by copycats.

Kick off your plans to register your mark by conducting a trademark search. You may do this through the United States Patent and Trademark Office trademark database. This database provides more information as to whether or not another entrepreneur has claimed a mark similar to or the same as your own and if there are any pending marks. If it turns out your trademark is not available, you may need to go back to the drawing board in creating a new one.

However, if the trademark is available it’s highly advised to file a trademark application as quickly as possible. This allows you to register the mark for your business and have the peace of mind in knowing the trademark associated with your brand is exclusively yours.

4. File for any necessary business licenses and permits.

Every side hustle turned business is different with varying needs. Once certain side hustles become full-time businesses, they may require business licenses and permits to operate and remain in compliance. Check in with your local Secretary of State to determine which business licenses and permits your company is required to have by the city and state you do business in. These often vary, depending on the location and industry of the small business.

5. Conduct annual maintenance.

As your side hustle transitions into a small business, you may pick up even more legal necessities along the way like an employer identification number (EIN) and doing business as name (DBA). Remember that businesses incorporated as LLCs and corporations are required to file an annual report. This allows them to communicate any changes made in the business and stay in compliance with the state.

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Deborah Sweeney – Legal Expert, CEO, MyCorporation.com – Calabasas, CA

As CEO of MyCorporation Business Services, Inc., Deborah Sweeney is an advocate for protecting personal and business assets for business owners and entrepreneurs. With her experience in the fields of corporate and intellectual property law, Deborah has evolved from lawyer to business owner. She has extensive experience in the start-up and entrepreneurial industry as she has been involved in the formation of hundreds of thousands of businesses for MyCorporation.com’s customers.

Ms. Sweeney received her JD & MBA degrees from Pepperdine University. She is active in the community and loves working with students and aspiring entrepreneurs. She serves on the Board of Regents at California Lutheran University and is a founding member of Partners of Pepperdine. Deborah has served as an adjunct professor at the University of West Los Angeles and San Fernando School of Law in the areas of corporate and intellectual property law. Ms. Sweeney is also well-recognized for her written work online as a contributing writer with top business and entrepreneurial blogging sites.  She is a regular contributor on Forbes, American Express, Social Media Today, and BlogHer among many others.

In her ‘free’ time, Deborah enjoys spending time with her husband and two sons, Benjamin (8) and Christopher (6). Deborah believes in the importance of family and credits the entrepreneurial business model for giving her the flexibility to enjoy both a career and motherhood. Follow her on Twitter @deborahsweeney and @mycorporation.

 

What’s the Difference Between DBAs and Trademarks? by @DeborahSweeney

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Many entrepreneurs new to the world of small business may find themselves easily mixing up the industry’s terminology and assorted acronyms. Trademarks, copyrights, dissolutions, EINS, DBAs, SUI, LLC… You may need to write the definitions down in order to memorize them at first!

Trademarks and DBAs, in particular, often get mistaken as being essentially the same concept when they couldn’t be more different. However, their sole similarity is that they both offer protection for small businesses. If you aren’t clear about the difference between the two terms, here’s a briefing that defines both and what they can do for your startup.

What’s a DBA?

DBAs go by a few different terms. There’s the Doing Business As name, which is what the acronym stands for, and fictitious name. By filing for a DBA, your company can conduct business and receive payment for its services under a name that is different from its legal name.

Why would you want to do business under a different name anyway? More often than not, entrepreneurs file DBAs as a fraud prevention measure. Your DBA name will still identify your business, but it will discourage anyone from registering for your name. In the meantime, having claimed a DBA name for yourself will allow you to create a business identity for your customers and vendors, market and advertise your company publicly, and open a business bank account to collect checks and payments under your business name. That last one is especially important because most banks won’t allow you to open a business bank account unless they have a certified copy of your DBA.

Ready to file? Check with your state or county that you’re business in first to see if you need to register a DBA since some states don’t require a formal registration. If you do need to register a fictitious name, file as soon as possible with your state government or county clerk’s office. You’ll need to pay a processing fee and identify your business with either your Social Security Number or EIN (Employer Identification Number) when filing and the registration process typically takes anywhere between one to four weeks.

What’s a trademark?

While a DBA may identify your business, a trademark goes a step further in making your business name your property. You can also trademark more than your company name too! Logos, slogans, and taglines also qualify as eligible for trademark registration. These are all distinctive words, phrases, symbols, and designs that are unique to your business and help distinguish your brand from that of the competition.

If you’ve already put in all of the hard work of dreaming up these original marks and conducted searches to ensure that nobody else was using them, protect them by filing for exclusive ownership. You can file a trademark application with the United States Patent and Trademark Office (USPTO). Once you’ve registered the mark, nobody else will be allowed to use or plagiarize your trademark. One extra perk to filing a trademark? As long as you pay your fees and file the necessary documents, these marks never expire and can protect your small business for as long as they are in use!

Is There a Right Time to Register a Trademark? by @DeborahSweeney

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Most entrepreneurs know that one of the smartest moves they can make to protect the assets of their small business is to file for a trademark. After all, this mark keeps your intellectual property — including unique logos, designs, and phrases — from being compromised by competitors and ensures that you alone have the exclusive rights to use it.

However, some entrepreneurs may find themselves wondering if there is a “right time” to register a trademark. What if you’re on a time crunch and need to use the mark now? If you know you’ll use the mark sometime in the future for your products or services, should you file now or wait? If you’re still trying to figure out a timeline for your trademark, here are some of the most popular filing options available to small business owners.

If you haven’t used the mark yet, but want to ASAP

As soon as entrepreneurs incorporate their business, they begin looking at everything else they need to protect their brand while further establishing it as unique in its field. However, the downside to moving forward without a trademark is that the unregistered mark is quite vulnerable. During this time, entrepreneurs can opt for early filing to protect and defend their trademark and vice versa — filing early to make sure that your mark isn’t accidentally infringing on another registration.

If you haven’t used the mark yet, but want to later in the future

Let’s say you own a stationery shop, but aren’t ready to open up your doors to the public and sell your products. You know you will be ready soon, but not right now. In this case, the USPTO advises filing an “intent-to-use” trademark application. This filed document allows the registration to be issued once you start selling your products or services.

Aside from intent-to-use, entrepreneurs may also file their trademark based on bona fide intent. Let’s go back to that stationery shop for a minute and revisit your products. Currently, you just have samples and not a full inventory of goods established. Bona fide intent means that the mark, while not quite market ready, is more than an idea. In order to use the mark, your samples would be classified under that category.

If you have already started using the mark

Already started using your mark on your offerings? Don’t worry — you can still protect it! The USPTO recommends filing under “use-in-commerce” basis if the mark used is in connection with your goods and services listed in your application. Your filing will also include an example that shows how you use the mark in commerce. For example, at the stationery shop that trademark would be visible on your store displays, product packaging, and any tags and labels associated with the store.

What happens after you’ve filed? A federally registered trademark can last forever, so long as it remains in use and you file the appropriate maintenance documents to keep the mark in compliance. The consequences your company faces if these documents aren’t filed are severe — with your registration cancelled completely. Be sure to file these forms by their deadlines to further protect and uphold your brand well into the future!

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Deborah Sweeney – Legal Expert, CEO, MyCorporation.com – Calabasas, CA

Deborah Sweeney HeadshotAs CEO of MyCorporation Business Services, Inc. (MyCorporation.com), Deborah Sweeney is an advocate for protecting personal and business assets for business owners and entrepreneurs. With her experience in the fields of corporate and intellectual property law, Deborah has evolved from lawyer to business owner. She has extensive experience in the start-up and entrepreneurial industry as she has been involved in the formation of hundreds of thousands of businesses for MyCorporation.com’s customers.

Ms. Sweeney received her JD & MBA degrees from Pepperdine University. She is active in the community and loves working with students and aspiring entrepreneurs. She serves on the Board of Regents at California Lutheran University and is a founding member of Partners of Pepperdine. Deborah has served as an adjunct professor at the University of West Los Angeles and San Fernando School of Law in the areas of corporate and intellectual property law. Ms. Sweeney is also well-recognized for her written work online as a contributing writer with top business and entrepreneurial blogging sites.  She is a regular contributor on Forbes, American Express, Social Media Today, and BlogHer among many others.

In her ‘free’ time, Deborah enjoys spending time with her husband and two sons, Benjamin (8) and Christopher (6). Deborah believes in the importance of family and credits the entrepreneurial business model for giving her the flexibility to enjoy both a career and motherhood. Follow her on Twitter @deborahsweeney and @mycorporation.

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