Small Business For Dummies, 6th Edition

Chapter 5

Making Financing, Ownership, and Organizational Decisions

IN THIS CHAPTER

Figuring out how much money you need to launch your business

Deciding how and where to finance your business

Considering your ownership options

Selecting the legal entity that works best for you

After you discover where you want to go with your small business and commit to the journey, you need to begin making some important decisions about how you’re going to reach your goals. In this chapter, we help you estimate how much money you need to get started, where you can expect to obtain that money, whether you want to set out on your own or with others, and what kind of business entity you need to get you where you want to go.

Determining Your Start-Up Cash Needs

Before you determine where you’re going to get your start-up funds, you need to understand that your business’s initial cash requirements include not only one-time start-up costs but also working capital and a reserve. Here’s what these requirements mean:

• One-time start-up costs: Start-up costs include such one-time expenses as legal fees, ...