Get Your Licence

The one thing

Making the business official is a milestone you reach when it is time, not a wall you have to climb before you start.

Start here

Many people never begin because they think step one is registering a company. Step one is a customer. If you followed this track in order, you either made your first sale before touching any paperwork, or you checked early because your trade needed approvals first. A licence is something you grow into once the business is real and earning, and talking to customers never needed permission.

That said, a licence is real, and the rules are not the same everywhere or for every kind of business. This chapter cannot give you legal advice. Treat it as a way to think clearly about the choice, so you go in with your eyes open and then check the facts for your own place and your own trade.

What to actually check

• Find out what your kind of business legally needs, and when. Some trades can operate and take early payment while small, and register later. Others, often anything touching food, health, money, or safety, need approvals or a licence before they legally take a single payment. The only way to know is to check the rules where you live, for your specific trade. Do that early, because a rule you find late can be expensive.
• Know that a licence can take many forms. In most places there is more than one path, at different costs and with different limits. There is rarely only one door. Look for the smallest, cheapest version that lets you legally do your work, and grow into a bigger one later.

Three ways founders handle the cost and the risk

• Validate first, register later where the rules allow it. Prove people will pay before you spend on becoming official. The early sales are the proof that the licence is worth buying.
• Partner with someone who already holds a licence. If your trade needs one before you can operate, working with a person or business that is already registered can be a legal way to start and test, while you decide whether to get your own.
• Let the first customers fund the licence. Weigh the cost of registering against the money your first sales bring in, and let real revenue pay for going official, instead of borrowing or draining savings to do it up front.

The honest part

Going official costs money and adds rules you then have to follow. It does not, by itself, bring you customers, and it can make some things, like bringing on people, more involved than when you were small. So treat the licence as a considered decision with real trade-offs, and make it when the business can carry it and has a real reason to.

The fear, named

The fear here is two-sided, and both sides can stop you. Early on, the fear is that you need a licence before you are allowed to start, which keeps you from ever making the first sale. Later, the fear is the cost, the paperwork, and the rules, which keeps you from making it official when you should. Name which one you are feeling. If it is the first, remember the paying customer already made you a founder. If it is the second, break it into the checks above and take them one at a time.

Your move this week

Spend one hour finding out what your specific kind of business legally needs where you live, and when it needs it. Write down which of the three paths fits your situation. If a fact is unclear, write it down as a question for a local expert and keep moving.

You are ready when

You have checked what your idea legally needs, chosen the path that fits your situation, and made the business official if and when it is time.