10 key steps when launching a side-hustle business

Here’s one question to think about – what will be your business’s most valuable asset? What will it actually own? Your brand – your business name, your logo – is what makes you…you. This is what your customers are buying into and this is how they distinguish you from your competitors.

These sorts of intangible assets make up between 60-80% of a start-up’s value. And, let’s be honest, Sockaccia! is a really awesome name for a brand… we wouldn’t be surprised if more than one person thought so too.

That’s why we think that making sure you have your brand protected should be the very first thing you need to do… before you think about anything else.

And let’s debunk some myths while we’re on the subject. Buying the domain name isn’t enough… and neither is creating a fancy-schmancy logo in Canva. Neither is setting up a website, having an email address, registering a company, packaging your Sockaccia! or anything else you’ve been told. The only way you can officially protect your brand is by trade marking the name of your business product and/or service. When you formally register your trade mark, it makes it much easier to enforce your rights against a third party who uses your brand without your permission, including counterfeiters. And that means coming down on them like a sack of strong white bread flour.

Imagine you haven’t got a trade mark at the outset. You’ve spent time and money setting up a company, building a website, paying for domains, doing your logo, packaging and all the other pretty sparkly stuff, and then taking it to market… and then someone decides to make their own Sockaccia! – or has already registered the name to use down the line – you have no way to stop them. All that brand value is diluted or even wasted.

So, protect the brand first, then spend the time and money investing in it, knowing that it’s properly protected. 

Ok, now Sockaccia! is trade marked, it’s time to move quickly to put all the basic building blocks in place. This means buying your domain (finally, we hear you say), setting up your social media profiles, designing your logo, setting out your colours and fonts, building a website (a holding page on that domain is fine for now… more on this later), sorting out packaging and a host of other things. Now is the time to kick this off.

Your next job is to decide what legal form you want your business to take. Here are the two main types you’re likely to be considering for Sockaccia!

You could register as a sole trader. This is quick, easy and free to do. You can still employ people but you would be personally liable (this means your home and possessions could be at risk) for the business’s debts, should it fail.

Alternatively, you could go straight in and set up a limited company. This removes the personal financial risk (provided you trade legally and don’t give personal assurances for bank loans) but it costs money to ‘incorporate’ a company and requires more effort to run it, with increased reporting and compliance (i.e. submitting returns and so on to Companies House).

Your first port of call needs to be the HM Revenue & Customs website. You’ll find lots of helpful tools to help you decide what format works best for you. Things like their sole trader versus limited company tax calculator. You add in an estimate of your annual profit and it helps you see an estimate of your take home pay with either type of business.

Linked to the above. We just wanted to have a quick word about how important it is to find the right professional advisers. Whether it’s getting some help with that trade marking work at the start, advice on terms and conditions or support incorporating your limited company. Down the line you’ll also likely want to hire an accountant to help with tax/company returns, and end of year accounts… perhaps even payroll. As a basic minimum we think it’s always good to know who you’d turn to, to get legal and accountancy advice.

There are LOADS of great tools for start-ups to help with… well, pretty much everything. For example, we love oneNDA (which makes it simpler to create, negotiate and execute Non Disclosure agreements)… Docular is another site that’s worth a look for free, standardised and editable legal documents (particularly for online businesses). If you need help collating what’s out there, Informi has various lists of best business tools for start-ups, including social media marketing tools for business. And don’t only think of tools like Xero, Float and your bank (whether Starling, Monzo or Tide) as technology. They have a wealth of resources, advice and guidance on how to streamline your financial systems, maintain a positive cash flow and grow your fledgling business. None of this is a substitute for getting the right professional advice but it can help to realise that it doesn’t have to cost the earth to think about protecting your assets.

Ok, so we’ve got some of the building blocks in place. Now it’s time to think about who you’re going to sell to. This is the single most important business development activity you’ll undertake. Our advice is to follow a persona exercise like this one from Hubspot. In essence it’s a process for really getting to know your target market(s) and then working out how you’re going to communicate with them (market) to get the results you need. It forms the basis of everything you’ll do from this point on.

Next you need to decide what you want to achieve and how you’re going to do it. That’s where your business plan comes in. Stuck on where to start? We’ve got a dedicated guide and free template for a business plan – which will take you through each stage step-by-step. 

How are you targeting customers? Use your personas and business plan to direct you (see above). Consider where your target market is talking right now. Do they want to engage with you on a website? Or would a Facebook shop be better? Or even in a real life store? Be guided by your personas and then find an expert to help. Don’t cut corners. This is your public face – your brand’s first impression. Use your local networks, LinkedIn and personal contacts to get recommendations for experts that can help and have a proven track record.

You might think you need to do everything yourself to start with but you might not be the most productive or financially-viable person for the job. Consider the skills you do and don’t have. Consider both the value of this support and also the cost (both financial and time). Some things will be best outsourced (like accountancy, legal etc) but others can be resourced through contract, part time and full time staffing (here’s our guide to hiring your first employee). And, don’t forget, before you start any recruitment process, talk to an expert to avoid those thorny HR pitfalls.

We’re not going to go into details here but if ‘who is going to do it’ is the first question alongside items on your plan, ‘how are we going to pay for it’ needs to be the second. Funding a new business can be a challenging task with startup grants hard to come by. Our advice is to try to think not about the very long term, or the day-to-day, but about the medium term when working out financial priorities. Embarking on trade marking might feel like an unnecessary expense upfront… but imagine getting all the way through these ten steps and only then discovering someone else making Sockaccia! Your world of knitted sock-inspired baked goods would be over before it had begun, and having cost you time, money and a whole lot of emotional investment.