Ideate for your Arizona Startup
Good ideas launch every successful business.
What new product or service can your business offer?
Your company idea improves what?
Determine your talents and interests: generating a concept that complements your personality, and positive attributes will motivate you to work long hours to overcome the many hurdles you’ll experience in starting your firm.
Learn how to market your expertise: if you don’t believe in and can sell your business idea, it won’t succeed.
Study. Test your idea to see if it’s marketable. Market research solves these crucial questions:
Does Arizona need your product/service?
Are there similar Arizona businesses?
What sets your company apart?
Answers may demand a complete rewrite of your initial idea. Before moving forward, wait until you find a market niche for your business concept in Arizona.
Plan a business. Write your business plan. Your business plan should show how your company will grow and attract investors. Business plans should include these sections:
Executive summary: Your business and why it will succeed.
Firm description: List the benefits and issues your business solves.
Market research—Research your industry, target market, and competition.
Staff and organization: Explain your business structure and management.
Product Description What are you selling?
Marketing plan—Describe how you’ll attract customers.
Fundraising: How you’ll spend the money you need to build your business in five years.
Forecasting finances: Balance sheets and data forecasting business finances
Appendix—An optional section with supporting and requested papers such as resumes, letters of reference, permits, etc.
Organize your business.
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Every startup requires money. According to U.S. Bank research, 82% of failing firms lack cash flow. It’s time to get the money your business strategy estimated for at least a year. You have alternative possibilities if you need to be more affluent to self-fund your firm.
These include a loan from the U.S. Small Business Administration, a commercial bank loan, equity crowdsourcing, or Arizona-based angel investors or venture capitalists (V.C.).
Unlike V.C.s, angel investors are wealthy individuals who spend their money on a venture, usually in its early stages.
Angel investors invest lesser amounts in assisting startups in getting started. While V.C.s invest more significant amounts for more control over a business. Smaller firms typically seek angel investment. Arizona attracts both types of investors.
Arizona Startup: Angels and V.C.s
Desert Angels — A Tucson-based non-profit with 85 angel investors who have invested $50 million in 115 local enterprises.
eCommerce: Angel Investment — A state-legislated initiative to increase early-stage funding for Arizona small enterprises.
Thunderbird Angel Network: Accredited angel investors sought early-stage Phoenix firms with high growth potential. Quarterly Thunderbird Angel Network dinners include pitches.
Angel. Co: Arizona Angel Investors – A massive list of approximately 5000 investors interested in investing in AZ firms. Each investor’s profile includes their professional history, interests, and amount of investments.
Cayenne Consulting: Arizona Venture Capital Directory – Lists AZ venture capital funds, angel investors, and private equity firms by size and focus.
The P.H.X. East Valley Angel Investor Initiative recruits angel investors and promotes East Valley tech startup funding. This site is mainly for investors rather than entrepreneurs. Although they provide great workshops for anyone interested in a local tech startup and investment trends.
Choose a business structure.
Your business entity choice will impact numerous things.
Three main choices:
Sole proprietorship—self-employment. Your business is legal.
Partnership—A partnership is a sole proprietorship with two or more people.
Corporation: A sophisticated legal structure that protects owners by separating directors, officials, and shareholders from the owner.
L.L.C.: A “Limited Liability Company” combines the benefits of a sole proprietorship and a corporation. L.L.C.s offer liability protection like a corporation without double taxation because profits flow through your tax return.
Small business owners choose L.L.C.s because they are easier to run and offer corporate benefits without the complexity. They pay taxes as a sole proprietorship. To choose a business entity, consult an attorney.
Business registration for the Arizona Startup
Choose a business name and check the Arizona business name database if you have yet to do so. If your name is unique, you can file a trading name online with the Arizona Secretary of State for five years. Processing takes 2-3 weeks for $10. This step is suggested but optional in Arizona for sole owners.
Arizona L.L.C./corporation formation
Corporations and L.L.C.s must register with the Arizona Corporation Commission. L.L.C.s need Articles of Organization, while corporations need Articles of Incorporation. After the A.C.C. approves your documentation, you will receive a letter with instructions. AZ corporations and L.L.C.s must appoint a registered agent to receive government papers and process notices, as in all states. You can be your registered agent, but first-timers should use a professional.
Top registered agent services.
Registered Agent Northwest assists. To start a business, file paperwork. Northwest has offices nationwide and helps company owners with this every day. Northwest provides registered agent services, annual report filings, and free business startup legal documentation.
ZenBusiness helps business owners start, run, and grow. Start with an L.L.C. and business formation strategies. Later, you may use their registered agent, domain name, or annual report filing services. $0 + state fees.
Incfile’s library helps first-time business entrepreneurs choose a business type. Incfile will help with papers and filing and explain registered agents, articles of organization, and E.I.N. Online reviews praise the company. See our Top Registered Agent Services list.
Get tax I.D.s.
It would help if you had a Federal Employer Identification Number (E.I.N.) to open bank accounts, process payroll, and file taxes. Corporations and L.L.C.s need E.I.N.s, whereas sole proprietorships need not. E.I.N.s can be obtained online or by mail from the I.R.S.
State company laws and taxes vary.
For state taxes that may affect your business, visit the Arizona Department of Revenue website.
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Business credit and banking accounts
A business bank account helps you file taxes and separates corporate funds from personal assets. Even a sole proprietorship should do this. Getting a business credit card will help you separate business spending and build credit, which may help you get investment later.
Major AZ business banks
Obtain licenses and permits for your Arizona Startup
Depending on its type, you may require several licenses and licenses to operate your firm lawfully. Restaurants need liquor licenses, and pawn shops need reseller’s rights. The paperwork is tedious, but it protects you from penalties, litigation, and other legal issues.
AZ does not issue a generic “business license,” but your type of business and location may require various licenses and permits. Business Licensing information is available from the Arizona Commerce Authority.
Location matters for internet and restaurant businesses. Consider the neighborhood’s demographics:
Will locals visit your business?
Will adjacent competitors share your profits?
Most entrepreneurs operate in Phoenix, the state’s major population center. Tucson, a vast metropolis, is another choice. Tucson has a young, well-educated workforce thanks to the University of Arizona. Flagstaff, another university town, offers entrepreneurs another Phoenix choice.
Insurance is a smart option for any business to safeguard against property damage and legal action. Two forms of insurance are needed by the federal government for firms with employees, while others are strongly advised or mandated by the state, depending on your business type. Discuss insurance options with a professional agent.
Workers’ compensation: Medical and disability payouts for workplace injuries and illnesses.
Unemployment insurance: Benefits workers who lose their jobs without fault.
Insurance suggestions: Professional liability insurance covers property damage, medical bills, libel, slander, and negligence.
Commercial property insurance: Protects business assets from fire, theft, and storms.
Disability insurance: Short-term benefits for sick or injured workers. California, New York, and Hawaii need it.
Internet presence Web presence is crucial to a company’s growth.
Key process steps:
Register a corporation domain (You can use Domain.com, Bluehost, GoDaddy.com, or Namecheap.com). Design and populate the webpage.
Join prominent social networking platforms (Twitter, Facebook, Instagram)
Google your business. Create Yelp, Google, and TripAdvisor accounts.