What to Know Before Starting a Business | Business Structures, Mindset & Strategy

SPEAKER_03 0:00

Don't ever expect your friends and family to support you. Don't ever expect it. Hope for it. But don't expect it. Don't feel entitled in thinking, oh, because I'm starting a business, then my friends and family are going to stop buying what they've been buying most likely for years and to start going to you just because they know you. That's usually not the case. It usually is not the case. You still have to convince them. Yes, everybody. This is your boy, Darren Harvey, and I'm joined by co-host Marie Shabazz. And we are the team at Financial State of Minds. This is a show where we help you get to that bag, manage that bag, and grow that bag as best as possible as we discuss financial and business literacy and anything and everything to do with the almighty power of the dollar. And this show is streaming right now on KGPC969.org, broadcasting right now on KGPC 96.9 FM and available on all streaming platforms of choice shortly after. So today's topic on financial state of minds, we're going to talk about things to consider and then how to go about actually forming a business. So in previous episodes, we've given you guys ideas, we've talked about the importance of credit, a business credit, but we've never really actually just said, all right, how do you actually form or truly start a business on paper? So Shabazz, I'm gonna let you lead this off. So some let's just say I'm a pretend client. Hey Shabazz, I want to start a Shopify account or a Shopify store. And I don't know a lick. That's just my idea. What would you tell the person to do when it comes to forming a business? How would you go about it? Or or sorry, don't tell me yet. What would you ask this person to think about before forming the business?

SPEAKER_00 2:27

Well, that's a good question because probably the first question I would ask them, are they solely going to just be selling merchandise exclusively over the internet? Right? So if they actually say, oh no, I actually have a store, I I'm planning on opening a brick and mortar, you know, but I'm gonna use Shopify as the online platform, then okay, that'd be a little different. So that's probably the first question I would ask them, just to see where is the business gonna, the business transactions gonna be conducted. Right? Right. That's gonna determine my next question, right? And the next question would probably, not even probably, so whether it's gonna be exclusively online sales online, we'll take that scenario then. And let's say they're in cali they're right here in California where we're at. So I would tell them you need to figure out the best structured entity for that, right? Right. But not just the best structured entity, but also what state would be best as well. So whether it's uh LLC, uh C Corp, S-Corp, I mean nonprofit wouldn't be ideal for selling merchandise because it doesn't matter, even if you are a nonprofit, that is selling products are taxed, whether you're a nonprofit or not. So that's that's one that's one thing that people all always overlook. They think that nonprofit, everything is nonprofit. No, they have uh they have this thing where they have certain things that are taxable as a nonprofit. So it's so selling actual products, merchandise, that's all taxable. So, but anyhow, people need to understand, because most people, you said it earlier, a lot of people think LLC is the structure. Like if I'm gonna start a business, I'm gonna start an LLC.

SPEAKER_03 4:29

LC, yeah. Yeah. So let me roll back a little bit and I should have probably started the episode by explaining the different entities. So you mentioned it and I'll break it down so we're all on the same page, listeners. Okay. So first you got to decide if you're gonna have a for-profit business, a non-profit business, and or something that's called a not-for-profit business. I'm not actually too familiar with the not-for-profit, but I am very familiar with a for-profit and a non-profit because I have both. A for-profit business is the one that everybody thinks about. It's your traditional business that is in it to make money. A nonprofit is a company where the company itself is not in it to profit. The business itself is not in it to profit. So it's in it to provide a service, usually a charitable service, to the community at large. So because that's the intention, it gets the famous tax deductible, it gets the famous 503. You get your the you have the ability to fundraise and you get more tax deductions or opportunities for tax deductions or reductions because of it. However, again, the business can't profit. So that means that you can't invest. My understanding is you can't have dividends given to the shareholders of a nonprofit. All the money that comes into the nonprofit must be reused back into the nonprofit for the purposes of, again, the services that the community would benefit. For profit is, hey, Darren Harvey LLC made a profit of$1 million. Well, I can cut myself a check of that, I can reinvest that back into the company, or I can reinvest that into the business's investment portfolio, and then now I can give dividends to myself, to people who have invested, equity, all that stuff. Anyway, so those are the three for-profit, not for profit, nonprofit. So that's what's called those business types. And then there's the actual business, the legality, the entity type. So those are LLCs, which can be broken down into single-member LLCs or multi-member LLCs. And then there are corporations, which can be broken down to a C Corp, which is kind of the standard corporation, or the S Corp. And my understanding is the only difference between a C Corp, or I wouldn't say the only, the most significant difference between a C Corp and an S Corp is the way the corporation is taxed, is my understanding. And then your LLC, there is a difference between a single member LLC and a multi-member LLC, other than just having more than one member. There are actual tax differences. I don't want to get into too much of the tax differences because I'm not a tax advisor. I'm not a CPA, but just know that there are tax differences. And if I or Shabazz are advising you on business, we would make you, we would educate you to the best of our ability, but we would advise you to seek a tax professional, preferably a CPA or a tax attorney. And I bring this all up and I really detail this because that was one of the biggest mistakes I made when I tried business for the first time, is I based everything too much off of social media and influencer information and not off of actual business lawyers or actual business professionals or actual tax professionals. Because they'll tell you, some in some cases, night and day information. So one quick rumor I want to dispel real quick is everybody in social media tells you go get that single member LLC. As soon as you get a business, as soon as you want to start, go get it. And in some cases, that is true. It depends on the business model and the criteria. And that criteria for me, in my experience, has been the industry you're in. So if you're in an industry where there's high risk for yourself or clients, then yeah, you're probably gonna want to go get the LLC right away. But if you're over here, again, selling clothes online, like a Shopify account, like we gave an example earlier, you may not need to form the LLC right away. You may can start as a sole proprietor, and then once you've made enough money, then you can form the LLC per tax advice I was getting by an actual tax lawyer. So when we are helping our clients, we make sure we we have these conversations with our clients because we know, me and Shabazz know that they probably heard 101 different pieces of information floating on the internet. So, okay, everybody's on the same page. So, Shabazz, let's go back to our example. So you mentioned maybe a difference between a brick and mortar that's gonna determine where the business is gonna be formed. So let's just say, hey Shabazz, I want a Shopify account, I want to sell online, but I want to within a year or two have a brick and mortar business where I'm selling my clothes. This is gonna be like a clothing store and kind of other merch like that. So, Shabazz, my question to you is should I form my business in Delaware? Like I hear all these social media influencers say, should I form an LLC in Delaware or should I form it in California? What should I do?

SPEAKER_00 10:02

I wouldn't do neither. What would you do? And the reason why I want to do Delaware is because Delaware has franchise tax, which is$300 a year. So I would go to a state that had no franchise tax. That's first and foremost. And there are several states that don't have franchise tax. However, a lot of people say Nevada, they don't have franchise tax. They don't have franchise tax, but how much does it cost to start an LLC or a corporation in the state of Nevada? It's gonna cost you close around about$800. So they're pretty much getting it on the front end. And to renew it each year, it costs that same amount. Or to keep it active, they require that same amount each year. So I I would go to Wyoming. I know some people have been using New Mexico, which is cool too. They have minimal fees. Uh, but in the state of Wyoming, it's only$50 a year to file an annual report. That's it. Um, it doesn't, you know, you might have to pay for a registered agent because you're you're probably not a uh resident of Wyoming. So if you're not a resident of Wyoming, I mean registered agents are like what,$25 a year. I mean, so okay, we'll average it out to about uh actually 60 bucks to file an annual report. They went up 10 bucks, so about 85 bucks a year. That's basically what you're looking at, outside of any profits that you probably make when you file your federal tax return and stuff like that. But just the state fees alone, that's all you have to pay. Wyoming doesn't require, they don't even have business licenses at all. So that's what I would say. And when you get to a point where you actually want to start that brick and mortar, yes, you will need to actually file. So let's say you started in Wyoming, you could file a statement of foreign designation with that state to do business in that state. Basically, my Wyoming LLC or corporation is gonna be now doing business in California or whatever state that you actually are gonna have your brick and mortar at. And now you're registered out of Wyoming and you're registered to do business in the state where you actually have your brick and mortar. But now you're subject to those fees of that state where you have your brick and mortar. So that's the thing. So if you're gonna do a brick and mortar, not only do you need to register your foreign LLC or corporation with that state, you will also need to go and get a business license because now you're operating within a city. And so you need to get a city business license. And nine times out of ten, depending on what state it is, you're probably gonna need a seller's permit nine times out of ten if you're selling something. So it's a lot more paperwork involved when you actually have a brick and mortar.

SPEAKER_03 12:49

Right, which is one of the main reasons why we historically advise if you're gonna start your first business, do an online digital product or service-based business. It's just less overhead, less paperwork, easier to get started, stuff like that. So we recently, I guess we released this episode at the time of this recording. We made an episode where me and you talked about how you can leverage AI to power your first business that has an overhead of$500 or less. So if you guys need ideas on what type of businesses, go listen to that episode. And I made two previous episodes way back in the day, a couple years ago, where I give you guys plenty of ideas. So we're not gonna talk too much about the ideas that you could do, but let's talk about okay, we've had these ideas. What makes it a good idea for a person who's starting for a first time, and what makes it a bad idea? So I'll give you an example. So, Shabazz, I was in sales for 10 years. Now I want to start my own business. And I'm coming to you, Shabazz, I have 10 years of sales experience. I've been doing this with lawyers, but I want to start my own thing. And let's just say I still have my job. What would you advise me to do if I'm coming to you and be like, what should I do on the side? What would you tell me? So you've been doing this side business for the last four years, right? No, so I've been doing, sorry, let me clarify. I'm currently in sales, selling legal products to attorneys. I've been doing that for 10 years. I want to start something on the side.

SPEAKER_00 14:27

Okay, got it, got it.

SPEAKER_03 14:28

That's my background. But I'm coming to you like Shabazz, I don't even know where where to start. Like what idea? Like, what should I sell? What should I do? What would you tell me?

SPEAKER_00 14:36

Well, I always tell people, man, when it comes to sales, the good news is that you know sales, right? A lot of people don't know how to sell anything. It's uh a lot of people struggle when it comes to sales. So the good news is you actually know how to sell. Now, the key thing is, of course, now you gotta figure out what you want to sell. And the most effective salespeople that I know sell things, are really successful in selling things that they really know about. Knowing what your product is and knowing what you're selling is a big part of it. I mean, because you could really know how to sell, but if you don't know nothing about the product, then you're not gonna be confident when they get to asking specific questions about it, right? Right. So I would say focus on something that you really know about, like in and out, you know, or or something that you are interested in selling, and you can learn the insides and out, and that's what I would recommend.

SPEAKER_03 15:39

Absolutely. So I'm right up there with you, and I would say, but there's only one thing I would say would be even easier and less effort. I mentioned in my example that I was in legal sales and I sell to attorneys. Well, that's what I would do. So answering that question is oh, well, I've sold to attorneys for 10 years. Let me sell something that attorneys buy. I already do that, so that should be easy for me to do on the side. Obviously, making sure it doesn't conflict with the job that I already have. So obviously I'm not gonna, you know, if I'm selling court reporting, I'm not gonna start a court reporting business selling and selling that. But something in line, maybe I work with attorneys and I sell them court reporting and I want to sell them marketing or advertising because they don't know how to use social media or something like that. Something like that. That I think is the biggest and easiest way people can start the side business. Take what they already do and then see if they can do that on the side and just slightly tweak whatever that product or service is. Then you don't have to learn as much. You're already the expert in that client base. And the biggest advantage is you probably already have a client base from your job, and you can just move them all over and you start with an audience, or you start with a client base or a potential client base or a target audience. You don't have to do all of that market research and learning about the audience because you've already had experience working with it at your W-2. That's the first thing that I typically advise or have people consider when they're thinking about starting a business. Now, the other thing, too, and Shabazz, you've talked about this plenty of times, is doing something that you're passionate about. So the reason people say that, or at least I would say that, is because at the end of the day, as glamorous influencers has made business, business is actually, especially in the beginning, very tedious, pretty boring, and overwhelming with a huge learning curve. You're wearing all the hats. It is all on you. You're upfronting your money or your borrowed money. It's all on you. That's one of the biggest differences. So it's important, in my opinion, to do something that you're passionate about because if you're just over here, let's just say going back to the example, I'm slinging t-shirts and I don't give two F's about clothing or fashion, then I'm gonna get burnt out or more likely to get burnt out compared to selling something that I'm passionate about, like finance is what I'm passionate about. My likelihood of getting burnt out is a lot lower because I genuinely like what I do. And one thing I always tell you guys is I genuinely love podcasting. I genuinely love helping people with finances, which is why I can and I'm willing to still edit my own shows and do my own marketing and everything, even with my disability, because I love it. I love it. You know, I love this process. I don't know if I would do all that if I'm over here unboxing a box of clothes and I'm slinging it out and I'm making sure all the merchandise is all hung properly and marketed. I wouldn't do that because I'm not passionate about it. So, Shabazz, focusing on these initial steps. We talked about formation, we talked about basic ideas, kind of the mindset and process. Again, we're helping somebody start their business. What other questions would you ask this client?

SPEAKER_00 19:23

I will say, what is your plan? I mean, given the formation and given um setting everything up, you done you know what you're gonna sell, you know how you need to do it, you know what you need to set up in order to get to a position to where you can start doing it. What is the plan? And I tell people a plan is more or less for you. It is to know what you're going to do, because a lot of people, man, I mean, I've been doing this for a long time and helping people structure business, and I could tell you probably 80, 90% of them don't have a plan.

SPEAKER_03 20:01

Yeah, I agree.

SPEAKER_00 20:02

They have an idea, but they don't have an actual plan. And that's probably why a lot of them fail. Because people think that, okay, as soon as I start this business and I open up the door for business, like, hey, I'm open for business, come on in. People think automatically that people are just gonna start falling through the door and hey, and handing them their money for their product or service. It doesn't work like that.

SPEAKER_03 20:33

Absolutely not.

SPEAKER_00 20:34

So in order, and and I probably would say this, even go a little further, like in that plan, I I you know, is there a marketing plan? Is there a plan to get traffic? And most people would say no, because one, they may not know how to market. Uh, two, they may not have a marketing budget. Right. Or three, they absolutely know absolutely anything nothing about marketing, right? Right. I think planning is probably one of the biggest. It's a lot of other dynamics in that, but I'm just gonna touch on that because I know it's a lot to expand on. But yeah, I would say mainly, what is your plan? What's in that plan, and how do you plan to execute that plan?

SPEAKER_03 21:20

Absolutely. And now in 2026 is the easiest time ever to figure out a business plan. Um, Shabazz is basically saying, what is your business plan? Write it out. Have ChatGPT assist you, or have any AI pick your AI, Gemini, Meta, I don't care. Have any of them help you write it out. It's gonna write out 90%, you know, it's gonna write out really the whole thing, and it's gonna be 80, 90% plus accurate on your business plan. And you just gotta tweak the other 10 or 20%. And having that plan written out is so important because I would say the following thing is um, and we kind of touched on it, what is your per? Personal goals of the business, and what specifically, what solution are you solving? I think a lot of people they have this idea, like, oh, again, I want to sell clothes. Okay, great. Well, there's literally we can't be exaggerating at this point, millions of companies and individuals that sell close at this point? Millions? What solution or how is your product gonna be different than the other one million companies that sell close? So you have to think about that too. And your business plan should answer that question. What solution, if you're providing a service, or what makes your product so much different or unique or better than the competition? That's a big thing that people don't think about when they're starting up in the business. They're just like, oh, I want to do this. It sales, I know there's a bunch of other companies that do it, so I know it's gonna sell. I know these people are gonna buy it because they buy it from a bunch of other companies. But no, why should they stop? Because in most cases, listener, especially if it's your first business, especially if this is your starter, your first, you're trying this for the first time, you're probably not coming up with a business that's brand new. There's no service that exists of it, there's no product that's exists. You're not just inventing something, right? You're doing something that's already being done right now. So you have to think of it as a business owner, how am I gonna take the client base away from these other companies? Because again, going back to clothes, if you're selling shoes or you're selling shirts, you're taking away business from Nike, you're taking away business from Adidas, you're taking away business from Columbia. So that's not the same as inventing something. So really think about that, listener. What solution or problem are you solving for the client? And that should be clearly presented and outlined in your business plan, and somebody shouldn't be able to poke any, if not too many, holes when they're asking you these questions. The business plan is for you, and that's true, it's primarily from you, unless you are trying to get investors. If you're trying to get investors, which I would actually advise not to on your first business, but if you're dead set on wanting investor money, then the business plan is essential because the investors are gonna want to know and need to know what the heck your business plan is. They're not gonna invest into something that you don't even have a very clear roadmap about. So speaking of investors, Shabazz, I'm sure because I have, and you've been doing this 10 times longer than me, I'm sure you help people who are just like, I want somebody to invest in my company. I'm dead set. I really like the idea of somebody investing into my company. I just said that I disadvise against that as my first business or somebody's first business. One, do you agree with that? And two, why do you agree or why don't you agree with disadvising investing for a business first business try?

SPEAKER_00 25:17

Well, as both. I can't just say I totally disagree or I totally agree. I agree because depending on the business model and if it is actually generating revenue and you actually have a model and you know exactly how to acquire customers, and you got your numbers, not projection. You got real numbers, then yeah, uh, investor and you know exactly, hey, if I bring in an investor that invests this much, I can take it here, then yeah, that's not really a bad scenario because you know exactly you have more data. Somebody who does not have any data, or also, like you said, it's their first business, they really don't have the experience of having a partner or an investor. Because investors, nine times out of ten, is usually a partner, especially depending on how much equity they're gonna have in your venture, right? So some people don't know you have to have the mindset to bring somebody else on, you know. There's transparency. Transparency is one of the biggest things in partnership. Are you willing to show them and give them access to everything so that way there's never no question about anything? They they can access anything and see anything at any time. Do you really have the mindset to have that type, that form of transparency, you know? And if you don't, and you kind of like to do your own thing and do it your way and stuff like that, then a partner or investor is really not for you. You right? Yeah. So yeah, I think it just depends on where they're at mindset-wise, and also what your business. I don't think people should bring on investors if they haven't generated a dollar. I think that's not even just on the investor side. I just think on your side, you don't even know what your business is even worth at that point. You have no potential of, I mean, you know what it possibly could be worth. I mean, of course, you have people are usually optimistic it's going to be successful and stuff like that, but what is your business actually worth according to numbers? And that predicts how much equity you would want to give up for however, whatever the price was or whatever the investment was. If you don't have that, then basically somebody could say, okay, I don't invest five or ten thousand in your business, but I want 50%. Now think about this. And let's just say that company make a million dollars the first year. You just gave up 50% for$10,000. So I just think it doesn't make sense until you actually know what the potential is in real numbers, not projections, until you bring on an investor.

SPEAKER_03 28:04

Absolutely. And you nailed it perfectly. Pretty much those are the reasons why you you kind of explain it may not work or may be a good idea, is my same thoughts too. And really, this more straightforwardly, if this is your first try, I again, my philosophy is how do we keep this as simple and as I don't want to say effortless, but straightforward as possible? How do we make it as simple and not complicated as possible? And that's something to consider when you form any business. Do you want to have a partner? Shabazz really harp on the investor part, which yes, investors you should look at as partners. But even a working partner, you you kind of have to figure out are you gonna be good with somebody? Are you gonna want that? Are you gonna want the not only the support, that's the positive, you're gonna have to support whether it's labor support, whether it's the partner actually putting some financial backing into the company with you. You can double your resources. But also, too, this is another person. Like I tell people, a business partner, especially if it's 50-50 equity, it's dang near the same as a relationship, like a romantic relationship. There's a lot of similarities, a lot of similarities. You gotta have the communication, you got to make sure your values and your goals are aligned, you got to make sure the trust is there, uh, a business partnership and a romantic partnership, or just a friendship in general. There, even though it's business, you're still dealing with a human being with emotions and their own biases and stuff like that. So that's one thing you could consider, and that's very important too, because that directly affects the formation type. Um, you cannot generally form a single member LLC if there's going to be two people who have 50-50 equity in that LLC. That's a multi-member LLC at that point. And then you have to decide who who takes who delegates what. Like, is this person in charge of operations? Is this person in charge with the finances or the strategy and stuff like that, the structure? You kind of have to figure that all out when you have one partner. And then, of course, as you increase the partners, there's more and more that gets complex. But again, you get more and more support to help you out. I've personally done both listeners. I have tried business where it was just me. I mostly tried businesses though where I have some type of partnership or some type of support at the out gate of the business. I would say there's no wrong or right with either one of them. But if I had to pick one for someone to try it for the first time, I would say try business by yourself first. Because again, it keeps things simpler and streamlined, but there's nothing wrong with a partnership. So, Shabazz, other things to consider around the formation time and stuff like that when it comes to business? What are the considerations do you kind of uh ask your clients?

SPEAKER_00 30:57

Well, one of the things is how much research have they done on what they're actually the business that they're going to go in? You know, and when I talk about research, whatever your niche is, how much revenue is that generating in your geographical area? And who are your main competitors, right? How much of that market share are realistically can you get, right? And depending on how saturated or maybe it may not be saturated, but let's say it is. And most, if you're like you said, if you're not inventing, if you haven't invented something that's not proprietary and anybody can do it, then obviously more than likely you're gonna have competitors, right? Right. So you need to know what is so different about you that they will actually come to you besides all the other ones that are already out there currently performing. So I ask people, how much research have you done? Just realistically, what is gonna be your strategy? Because you're coming in on a market where there are already people doing this. How are you gonna get a percentage or a piece of that lion's share, right? How are you gonna do that? How do you expect to do that? And I think that'll give you a realistic idea of where you're going and how to execute it. Like I said, that goes back to the plan.

SPEAKER_02 32:27

Yeah.

SPEAKER_00 32:28

And part of the plan is knowing, right? Right? And if you don't know and you're just thinking, like, okay, I do know, actually, a friend of mine, he felt that he didn't have any competitors because they've been in business for 50 years. Let me tell you, if they're selling the same thing that you're selling, that is your competitor. It doesn't matter how much money you. I mean, shit, McDonald's is a multi-billion dollar company. But if another burger store opens up across the street from one of your franchises, that's your competitor. I don't care. Right. It doesn't matter how big or small that is. If they're selling the same thing, then people are actually going to make a choice when they go down that street and say, Do I want McDonald's or do I want that spot? You have competition. Absolutely. That's just the bottom line. So I think people just need to actually analyze the market and actually do the numbers. The numbers is everything. I tell people that all the time. You're looking at a product or you're looking at a service, and that's cool. But the one of the main focuses is the numbers. And when you look at the numbers, then you can get a realistic view of what you can do and what the potential is. Because if you don't know the numbers, and even if you go like on Shark Tank and stuff like that, people that don't know their numbers, they don't invest in.

SPEAKER_03 33:45

Right.

SPEAKER_00 33:46

Period.

SPEAKER_03 33:46

Yep. So you need to know. This is the bottom line. Absolutely. I mean, we just talked about it offline. That's what I'm doing right now, primarily, is market research.

unknown 33:54

Yeah.

SPEAKER_03 33:54

Market research making you have you may have an idea, kind of like I said earlier. You may have an idea as a business owner that, especially if you see competitors doing it, oh yeah, they're gonna want what I want. Because you see it happen, you see it in it being it sold. But why would they want it from you? And that's where you have to go do the research on. The other thing, too, that I wanted to mention, other than doing your homework, is understanding that starting your own business, no matter the size, is time consuming. The whole shift from W-2 to whether you're a 1099 contractor or you're an actual entrepreneur, it's a total mind shift, which we have talked about plenty of times on the show, but just focusing on the time aspect. When you have a job, I don't care if it's your first day, you don't wait more than a month to get paid. You don't wait more than a month. When you start your own business, the chances of you getting making a profit to the point where you can pay yourself or you should pay yourself in the first 30 days, probably not gonna happen. Probably not gonna happen. I almost want to say I can guarantee you it's not gonna happen. Because even if you make a profit, you should reinvest it into your business. But the time it takes, especially if you're deciding to do a physical brick and mortar business that sells physical products in the state of California. Oh, you're not even gonna start selling anything probably six months out.

SPEAKER_00 35:35

Absolutely not.

SPEAKER_03 35:36

Yeah, six months at least. Yeah, because California state, shout out to the Secretary of State, but they're not the fastest when it comes to the turnarounds. And you can't do a lot of stuff until your paperwork's in order. You literally just can't break ground until you get certain paperwork back. So understanding the time frame that things take and how, for lack of a better word, slow entrepreneurship is, especially in the first year, it's slow. And it may be slow for years, especially the bigger you build you want to build out your business, the bigger you want to do things, how big you want to go. It may take you the whole year just to do the market research, the overall business plan, and getting the funding if you really want to get investors involved, even if it's just friends and family. People misunderstand the power of crowdfunding. You're most likely your first set of investors is gonna be your friends and family. But even still, they're gonna want a business plan, and they're gonna, like Shabazz said, they're gonna want to know with numbers, not projections of school, but they prefer actual numbers that came from somewhere. So the time that business can take is gonna be, especially if it's your first time, it's gonna be quite a bit different than working a W-2 job. So, Shabazz, back at you. Other things that people should consider before starting a business from a structural standpoint of you.

SPEAKER_00 37:03

From a structural standpoint, yeah. Well, we went over formation. You mentioned get a CPA, just uh uh figure out tax liabilities. We went over research, planning. It is, and I did touch on marketing and traffic, but how you're gonna acquire customers, that is actually a big deal because that's what's gonna drive your revenue. And most uh entrepreneurs starting out, and it's various reasons why they don't, why they fail, but I'll tell you the biggest part of why they feel is they're not able to acquire enough customers consistently. Right. And you need to know how to acquire customers. If you don't have a marketing budget, and I get it, that entrepreneurs start and they just don't have the means to market, whether they just don't know how to market or they just don't have the funds to market it to market and stuff like that, or acquire traffic, you need to learn. You need to learn how to get some traffic, whether you're doing it through SEO, you're gonna learn SEO, because if you don't have a marketing budget, that would be the alternative. I would tell you to learn SEO because that just requires skills rather than add budget. And you need to definitely figure out how you're gonna be able to get customers.

SPEAKER_03 38:25

Absolutely. And I say that's one of the arguably that was the most trouble I had in all the businesses I've ever tried is how do you get your clients? How do you get your audience? You mentioned it at the top of the episode. People aren't just gonna go, oh, you have a new clothing business. I'm just gonna start shopping there just magically. Something, a spell comes over them and they magically just stop going to Nike and they're gonna start going to your clothing store of choice. Oh no, Darren, they're gonna do that because they're my friends and family, they're gonna support me. I've said this before as one of my more popular clips. Don't ever expect your friends and family to support you. Don't ever expect it. Hope for it. But don't expect it. Don't feel entitled in thinking, oh, because I'm starting a business, then my friends and family are gonna stop buying what they've been buying most likely for years and to start going to you just because they know you. That's usually not the case. It usually is not the case. You still have to convince them. Again, what are you what solution are you solving for them to the point that you can pull them away from buying again clothes at place number A, and they're now coming to you. That's one thing. Oh my gosh, we got like seven minutes left. So this is gonna have to be a a multi-series episode because they're the last one I'm gonna end with, and we can keep going because I have stuff in mind that I can keep going with. But one thing I think a lot of new business owners don't do is they really need to invest into some type of mentor coach. And you'd be surprised, listeners, how many business people, regardless of their status, are willing to mentor you. One beautiful thing about business is for the most part, people are willing to support you that are also in business. They're generally willing to support you. So grabbing a mentor or paying for a mentorship, paying for a coach too. I've done that plenty of times. And getting them as close to your niche, if not exactly what you've done, man, that's so powerful. Because it takes so much of the guesswork out of it. You now know somebody who's walked down the road you're currently walking, and they can advise you, they can teach you what to do and what most importantly not to do when it comes to business. And there's so much. Because again, at the end of the day, this is all on you. You're learning. It's not a job. You don't walk into business and there's a structure there. You have to build the structure. So if you don't know how to build the structure, you have to go out and figure it out. And the best way to figure it out is to go to someone who's already done it. That's one of the easiest and best ways to figure out. That's what I did. Why do you guys think I have Shabazz? First two years, Shabazz wasn't here. I was like, man, I don't know exactly everything I'm doing. I was lucky enough to find someone who knows what to do. So I'm like, help. And there's nothing wrong with it. It's actually smart because they've they've experienced, and a mentor or a coach or an advisor has experienced stuff that you have not. And a lot of times you just won't know to think of it. I think that's the most important thing. You don't know a lot of times what to ask or to think because this is a brand new thing. This is again not W-2 life. So I'll leave it right there, Shabazz. We got a couple more minutes. I'll leave you with the last thing. Is there anything else people should consider before starting their own business?

SPEAKER_00 42:03

Yeah, man, I think you touched on it a little bit earlier, man. And I'm gonna I'm gonna leave with this is that this is actually an extraordinary time where you can you have access to so many tools. Whereas when I started business years ago, I didn't have access to not even a percentage, a small percentage of these tools. Maybe a fraction at the most, at best. There are so many things that you have at your fingertips to do research. Like when we when I had to do research, I actually I had to read books. I had to read through different forums, blogs to find the information. You can actually ask a specific question and get a straightforward answer. We didn't have that technology. So the start of business right now is probably far more easier to do a lot of these dynamics that we just mentioned than it was 10, 15, 20 years ago for sure. So take advantage of that, take advantage of chat artificial and there's a ton of apps out there that do several different functions. Take advantage of that stuff and leverage it to your benefit.

SPEAKER_03 43:24

Absolutely. Like I said, the last episode I released at the time of this recording, you can start a business with$500 overhead. That's it. And that's really all because of technology. You can do 80-90% of the work with technology, with specifically AI. So this is the time. Like this is the best time in I would say human history to start a business, to start a side hustle. And one thing I'll say too is most people who start businesses for the first time, they don't have the capital. So that's where you need to check out our our episodes on business credit. That me and Kavaz have both done multiple episodes of. So if you really need the capital, you can leverage your business credit or your personal credit if you absolutely have to to help you with the capital. And then the other biggest asset in business is time. So generally speaking, if you don't have the money, you have the time. Or you're going to have to find a way to get the time. So leveraging your time wisely with your money wisely is two of the most important things in being successful in business. So I'll end it there. We're already up on time. So Shabazz, as always, thank you for jumping on with me. This has been Darren Harvey with Marie Shabazz over here at Financial State of Minds. We are the show that helps you get to that bag, act that back, and grow that back as fast as possible as we discuss financial and business.