A Sign of Things to Come?

As I mentioned in an earlier post, I spent the majority of the past two weekends, when not working in QuickBooks, basically addressing approximately 400 marketing postcards (yes I realize that I could have the computer spit out pre-printed labels but some strange part of me thinks that handwriting the address is more personal).

The postcards were being sent in advance of an upcoming tradeshow to alert buyers that we'll be there for the first time and give them a sense of the products my company offers. In addition to hitting all the "usual suspects" for my product, we also went a little outside the box and sent postcards to stores that sell what could be considered parallel items but not exactly items from our niche so it is a bit of a guess as to how well those will be received.

However, I just got off the phone with one buyer who received our postcard today and wanted more information about our company and our products. She was very excited to see the picture of our product on the front of the postcard and says she's looking forward to meeting us at the tradeshow and seeing the products in person. I'm sincerely hoping that this the first in a series of good results from this tradeshow!

Keeping Up Your End of the Bargain

As I mentioned in an earlier post, I have a significant other who supports my foray into the world of entrepreneurship financially, mentally, and emotionally. It’s hard work to start a business and I can’t imagine starting one without the support of those close to you. However, it does bring up a good question of what can the entrepreneur do to hold up their end of the responsibilities.

I’m not just talking about the financial burden that all of the sudden finding yourself without a paycheck obviously has – though that is very important to take into account. But also the fact that for you work NEVER ends. If you’re committed to it, you can’t just turn it off and you’re always either physically working on something or some piece of the business is churning away in the back of your mind (most recently at 2am!). I’ve been told that as the business grows you’re able to separate yourself a little more but right now we’re talking bare bone stages. This of course takes away from the time and attention you give anyone significant in your life be it spouse, family, or friends.

So how does the entrepreneur keep up their end of the bargain? Honestly, I don’t know and would love some answers. I’m lucky enough to have a partner who believes that “home” tasks such as laundry, meeting with contractors, sweeping the floors (which I don’t do enough of), taking care of the dogs (aka, the VPs) have intrinsic value. So while I try to pick up the lions share of those tasks in truth it doesn’t feel like I’m contributing a whole lot when he’s the one who’s working every day to keep a roof over our head and food in our bellies (and keeping our dogs in the lifestyle to which they’ve become accustomed).

Not to mention the fact that it seems like every chance I get I want to run new ideas or concepts by my significant other to get his read on things. I imagine that there have been many a day when all he’s thinking is that he wants to sit back and not deal with my business problems after having dealt with his work all day. I try to be respectful of that but once again my brain seems to ALWAYS be working on the business.

I dream of being able to reward him one day by having made enough money to give him the flexibility to do whatever he'd like after his supporting my dreams for so long. But in the meantime I’ll ask again, how do entrepreneurs keep up their end of the bargain with their partners, family, and friends?

The Young Entrepreneurs

There is an interesting article in today's New York Times about the new plethora of teen entrepreneurs:

http://www.nytimes.com/2007/01/25/garden/25kids.html?pagewanted=1&8dpc&_r=1

Administrative Duties

It's funny how your - or at least my - outlook on administrative tasks differs when it's my own company versus working for someone else. As an example, at one point in my short-lived corporate career I was asked to go through and make some changes to the sales database. It was absolutely mindless data entry work and while I obviously did it, it wasn't something I enjoyed doing and more or less simply slogged through it until the job was done. Now however, in preparation for this upcoming tradeshow I received approx 600 names of retailers who will be there and fit a specific industry category. I spent all of last night making changes to the database, cross-referencing with websites to see if the companies really did fit my product offering, and making other small changes. It took several hours and yet because it was my own company, I was really excited to go through the list and see what was there. Every name is a potential new retailer for my company's product which will help the product grow and the brand gain strength. Not to mention that every new retailer helps the bottom line. I can't imagine what my attitude would have been at my old company if I were asked to spend a Saturday night going through a database, but when it's my company I really enjoyed the task.

So, Saturday night was spent doing database work and most of today will be spent making some minor changes to my QuickBooks (per the accountants request). Wild weekend here let me tell you!

Business Structures 101

A few folks had asked me about the different types of business structures that can be set up so I thought it may prove helpful to develop a primer of sorts. However, I am not a lawyer nor do I play one on television. All information contained in this post (and this blog) is based on my experience and a few entrepreneurship courses I took at b-school. Without a doubt you should ask a lawyer about any and all business structure questions.

Sole Proprietorship
Pros:
Easiest business structure to set up and no legal oversight necessarily needed.
Any income you earn from a business of this type is reported as part of your personal income tax return.
Any expenses from this business can be deducted from your personal income tax return.

Cons:
There’s no barrier between you and the business. Therefore, you are held personally liable for debts and any legal liability associated with the business.

Limited Liability Corporation
Pros:
Only a few hundred to set up (cost varies for state filings)
Ability to have as many shareholders or partners as necessary.
Can create different percentages and levels of shareholders as needed.
There’s a level of protection between your personal life and the business so all business debts and legal issues are the domain of the business and cannot be assessed on the shareholders personally.
Can change to an S Corp down the road though it may be costly.

Cons:
At the end of the year any profits are distributed among the shareholders. This can be seen as a negative if you’d like to keep cash in the business for upcoming expenses.

S Corporation
Pros:
Limited liability similar to an LLC which protects personal assets
Profits flow to shareholders – though I *believe* that you can leave some money in the business.

Disadvantages:
Slightly more expensive to file and legal representation is highly recommended
More stringent rules for how the company is goverened and reports itself.

C Corporation
Let’s be honest, if you’re filing as a C Corporation (think Fortune 500) then you’re well ahead of me!

Oh Happy Day!

Finally finally FINALLY all the merchant account stuff has been processed and is working correctly. Which means in the last 48 hours I've been able to collect over $1000 worth of charges that have been sitting on my books. With this tradeshow around the corner, which is proving to be far more expensive then I originally anticipated (that's another whole post!) the timing couldn't have been better!

I'm doing a happy dance!

And by the way, as a followup to my IRS post - after finally getting through to them via the phone it was a pretty simple fix and the woman on the phone made the necessary change. I was shocked it was that easy...so the happy dance continues!

Tradeshow Dreamin

My company is heading to a trade show in San Francisco next month. I'm really looking forward to it as the show has the potential to open us up to a whole new catagory of retailers for whom our product could be a really good fit with their merchandise mix. Plus, a lot of these retailers (and their customers) are less price sensative then the retailers I met earlier at another trade show which is good since our product is definitely an upscale item with upscale prices to match.

While I am really looking forward to the show, all of my dreams lately are about the tradeshow/preparing for the tradeshow/inventory for the tradeshow/employees to help with the tradeshow/how to decorate the booth/etc etc etc. I'm exhausted but can't seem to turn my mind off - or at the very least turn it onto something else!

Faith In The IRS

I spent a portion of today on the phone with the IRS trying to resolve the problem I mentioned earlier. Despite the fact that it is a screwup on the IRS' end, my accountant is worried about the fact that they expect me to file one form when in reality I have to file a different form (which also has a different due date). Here's a basic transcript of my IRS phone call:

Call #1: Goes through quickly, explain the problem to a real person and he transfers me to the appropriate department.
Apparently the transfer doesn't go through as I end up talking to someone in the "Individual Tax Problem" hotline (not the "Business Tax Problem"). She puts me on hold...and never comes back.

Call #2: Call the same number as before, explain the problem to a real person and this time am transfered to the appropriate department. However, the first thing the person at the appropriate department says is: "My name is XYZ, my ID # is 1234, our computers are down right now so I can't help you. You can either send us a letter which will be addressed within 30 days (which is after the due date for business taxes) or you can try calling us again next week."

I'm figuring it was one of two things...1. Our gov't is using woefully out-of-date equipment and apparently doesn't have backup servers that could be used given that this is what one would assume is a really busy time for the IRS. 2. It was close to 5pm east coast time and this person didn't want to be stuck late on the phone with some ignorant yahoo (me!) when she had Friday night plans.

I'm also now wondering if thanks to this post I'm going to be audited.

AMEX Merchant Account

Well, with several hundred dollars sitting in accounts receivables, I went ahead and got an AMEX merchant account today. It turned out to be far less painful then I anticipated. Apparently, because I don't anticipate having more than $5000 in AMEX charges over the course of 12 months, I'm simply charged a monthly usage fee ($5.95) and am not charged any sort of percentage of the sale. For $60+ a year this doesn't seem like too bad a deal for me!

I'm not sure if I mentioned it before or not, but to accept credit cards I use a virtual terminal since I'm not a retailer who necessarily needs to have a real terminal in front of me. It's pretty painless and for me I like the freedom it gives me to process credit cards from anywhere. Should anyone else out there be looking to set up a merchant account, I used Merchant Express which was recommended to me by a friend and have found them to be very helpful and their prices rather reasonable.

Now hopefully I can start collecting that (much needed) money!

What do you dream of?

The wonderful thing about the start of the new year is that it's a chance to dream big dreams about what you're going to do this year (if you want to be technical, I guess every new day offers that opportunity but in reality it's the start of the year that tends to get people thinking big).

This got me thinking about how every enrepreneur I've talked to has their own goals and dreams when it comes to their business. So, what are your dreams? If you are an entrepreneur, what are you goals for this year? If you don't yet own your own business, do you have anything this year you want to accomplish to get you a step closer to enrepreneurship? And regardless of whether or not you're currently an enrepreneur, what's your end goal...the dream that's in the back of your mind that you think about when it's late at night or when things at your current job get so bad you think of ditching it all?

Do you dream of telling your rags to riches story on Oprah? Do you dream of ringing the opening bell on Nasdaq the day your company goes public? Do you dream of moving to Napa and buying a winery? Or do you simply want to be able to work from home and raise your kids?

This year my immediate goal is to be able to pay back the loans I used to start the business. Anything over and above that would be wonderful but the most immediate is pay back the loans and keep the business cash flow positive.

As far as my end goal...I want to buy a house in a mountain town (on days when I dream really big it's a house on 20 acres of land). I don't even wanta big house, but one where I can have plenty of dogs. There would be room for friends and family, and I'd probably build a commercial kitchen onto the property (if it's big enough) so I could cook to my heart's content in between hiking/biking/ and cross country skiing. When I have a bad day I check out real estate listings online to feel better and keep me motivated.

My little dirty secret is that I'd probably start up some type of business again from there. I think I've been bit by the bug and there's just too many ideas running through my mind to keep me still for long. Then again, maybe I'd just focus on becoming a top-ranked skate skiier and start touring with the National Skate-Ski Organization. Do you think they'd let the dogs come with me?

So, what’s your dream?