I am an attorney by trade. I did not think of myself as an entrepreneur, which is why I originally went to law school. However, my passion for entrepreneurship grew through the practice of law. I enjoyed finding new clients and building relationships. I quickly grew my own book of business at my law firm. I also was married to an entrepreneur, so I saw the joy that entrepreneurship can bring – the flexibility, the ownership (literally & figuratively) and the joy from success.
After a few years in the practice of law, I went in-house to one of my clients, which gave me a broader perspective on business management. When the business was acquired by Intuit, I was appointed to run the division in a business role. It was a great way for me to learn how to grow a business with the cushion of corporate ownership.
In 2009, the economy was faltering and I saw Intuit divesting smaller divisions. I offered to purchase MyCorporation out of Intuit and, ultimately, I became a true entrepreneur with a business of my own. It was a different road to entrepreneurism than most, but it proved to be a path that led me to great happiness, flexibility, and wonderful challenges!
What have been the biggest challenges in being the CEO of a successful business?
The biggest challenges in being the CEO of a successful business are managing the team and growing the business. My team of almost 40 employees keeps me on my toes every day.
With that said, we are a TEAM in every sense of the word. We work together, we care about each other, and we have learned and grown together. It is different than when I was an ‘individual contributor’ in a law firm environment. It’s not just me – now it’s a whole team and I have to make sure I inspire and educate and share with them our initiatives. I have to make sure to keep them moving and inspired and focused on our goals. That’s always a challenge, but I continue to grow as a result of that.
Growing the business with the right mix of marketing is also a continuous challenge. Evaluating ROI and making sure we are profiting from our marketing spend is always a challenge. We try to find the right balance between brand development, growth of revenue, and targeted marketing. We are constantly evaluating the right marketing mix.
In your opinion, what are the most common issues that cause some small business to fail and others to succeed?
I think some small business owners want to see quick, immediate success. I recognized that it might take some time for us to grow after we spun out of Intuit. I see that many entrepreneurs focus on being ‘millionaires’ without focusing on the journey and the strategy along the way.
I have taken the ‘slow and steady’ approach to business growth. There will be some big wins and some big failures and in between the needle will go up and down, but the goal is, over time, to have it headed up and to continue growing. We take baby steps, we do not bite off more than we can chew, and we hire the right people. All of these things take time. As long as we are moving in a positive direction, we are making improvements and learning.
Having the patience to allow this process to evolve is important and is not always something that can be found in entrepreneurs, whose impatience is often what leads them to failure.
What is your best piece of advice for small business hopefuls?
Work hard and have fun! It is important, when you are a small business owner, to work hard. Work never stops, and it is always on your mind. The next phase, the next big idea, the next new hire or marketing strategy are always rolling around in your head. That is great. Hard work is critical.
But, it is also important to have fun; to take often-needed time away from the office. Have fun with your teammates. Make work enjoyable by celebrating everything — birthdays, work anniversaries, successes on goals you have set. Get the team involved. Have fun together and allow them time to have fun outside of work. When everyone is working hard, it is also a good idea to have fun!
What aspects of your business, MyCorporation, are you most proud of?
I am most proud of our growth as a stand-alone business. When we were owned by a large corporation, we always had a cushion. We have been successful because we put our entire focus on top-notch, unexpectedly wonderful customer service.
In an industry that has almost become commoditized and that our competitors are looking to streamline, save costs, and automate, we are focused on automation in combination with top-notch customer service. No matter how automated your service, there are entrepreneurs who are always going to have questions and who love our customer service.
We have a live person answering calls, we have live people answering questions, and we call each customer back to confirm they received their order and ask if they have any questions. We spend a lot of money on training and making sure our team is focused on top-notch customer service. It pays off, though!
Our customers continue to come back year after year for annual filings and they use us for other businesses. Satisfied customers tell their colleagues and friends and, as a result, we retain long term customers.
How does incorporating a business help to protect the parties involved? Why should small business owners incorporate?
Incorporating a business protects small business owners because it separates business assets from personal assets. Incorporating a business creates a corporate shield that insulates the owners’ personal assets. When there are multiple owners/partners, it is a great way to define roles and responsibilities as part of the incorporation process. The operating agreement or bylaws are a great place to account for management of the corporate structure.
Incorporating or forming an LLC can also provide significant tax savings to business owners. Every business is different, so the structure may depend upon a particular business owner’s needs, but nevertheless, a corporate structure can be very valuable and provide great savings to business owners.
Finally, incorporating adds a level of professionalism to your business. It enables businesses to get funding from banks and other third parties. Third party financing entities are highly unlikely to fund an entity that does not have a corporate structure. Hence, it is a huge win financially and from a legal standpoint to incorporate or form an LLC.
What are some of the best ways for small businesses to market themselves?
Small businesses often do not have a huge marketing budget. Small business and entrepreneurial ventures often have to get ‘scrappy’ and creative in their marketing ventures. We have found that building partnerships, affiliate relationships and cross-referrals can be one of the best ways to grow a business.
Under our former ownership, we used to spend millions in marketing and we were still growing at the same pace as we are today. The difference was that our marketing dollars were less targeted.
We find, now that targeting partners’ customers (via cross-incentives for our customers & cross-blogging for content) is a cost-efficient method for growing our business. Developing strategic alliances with companies that serve business owners within your industry is a great way to market to customers who are similarly situated and within your industry. This can be done affordably and can be a great mechanism for slow and steady growth.
In your opinion, what do small business owners tend to overlook the most when starting their business?
Small businesses often tend to overlook their ROI (return on investment) when it comes to growing their businesses. Small businesses spend money on marketing or hiring or development. Then they don’t know how the money they are spending leads to return. It is a big miss.
If you ask a small business owner what the return is on specific expenditures, often they do not know. This is problematic because then they don’t know what they should do more of to yield more growth (or less of to cut losses). It’s important to know how you are earning money and how the business is growing and having a good handle on ROI is the way to do that.
When should an entrepreneur incorporate their business? When should a freelancer incorporate?
Entrepreneurs and freelancers should both incorporate when there is any risk of liability. They need to protect their personal assets. They can also yield significant savings form a tax standpoint. Often freelancers or even single member owners can put themselves on payroll for an s-corporation and can see significant FICA tax savings.
Entrepreneurs who are in need of financing (whether from banks, investors or even partners) will need to establish a formal corporate structure to receive financing. If shares are issued or if money is given in connection with an investment in the business, it will be a requirement.
Even when opening a bank account in the name of the corporation, the bank will require the TAX ID (EIN) of the corporation or entity to whom the checks are written. While a business can have a DBA, the DBA does not provide liability and corporate protections, so often a corporation or LLC is a better structure.
Besides incorporating, what else can a small business do to get a strong start?
Protecting intellectual property is an important step in the business start-up process. Getting a domain name to have a presence online is very important also. This often represents the brand or identity of the company. Protecting trademarks is a critical step. A business owner does not want to invest a significant amount of money in the brand and marketing of the business only to lose the identity to another business.
Make sure your trademarks and copyrights are protected before spending significant resources growing your business brand.
What can an entrepreneur do to find out whether their idea will be successful?
Entrepreneurs should test market their product or service to friends and family. Talk about the business, get a sense from others of the pros/cons of the offering. Be willing to integrate feedback into your “R&D” process. Don’t be so steadfast to your idea that you are unwilling to make changes and potentially improve on what you do.
Also, don’t listen to every piece of feedback. Consider the feedback carefully, but if it’s just not great feedback then don’t worry about it. Stay focused and stay the course. Don’t get thrown off by people who tell you random things – sometimes people just want to give feedback. You have to be savvy about what feedback is valuable and what feedback will not lead to the best use of your time.
What do you love most about owning your own business?
I love the flexibility that owning my own business brings. I get here early and I stay late. I think about it all the time. It’s more than full time, but it’s something about which I am passionate. I love this business, I love the people, and I truly enjoy helping our customers. It’s an adventure every day.
I look forward to coming to work and that is because I am not ‘tied’ here. I’m also a parent, I serve as a Trustee on a University Board, donate my time to a couple charities, and spend time with my husband and two sons. My boys play all sports, so I’m also team mom and full-time chauffeur. I love it all. I love the flexibility to do it all.
I afford significant flexibility to my team members too…we support each other in our quest for balance (persona & work). So, it is the structure of entrepreneurship that gives me the flexibility I so treasure!
Deborah Sweeney is the CEO of MyCorporation.com. MyCorporation is a leader in online legal filing services for entrepreneurs and businesses, providing start-up bundles that include corporation and LLC formation, registered agent, DBA, and trademark & copyright filing services. MyCorporation does all the work, making the business formation and maintenance quick and painless, so business owners can focus on what they do best. Follow her on Google+ and on Twitter.