10 Steps to Starting a new IT Company

The software industry is growing day by day. If you are planning to jump into the IT/software business and want to start your own company, here are the 10 most important points to consider and follow.

You must have an idea.

You must have an idea regarding the IT company that you are about to start. A basic concept includes where you will get projects, whether you already have a customer base, and which technology you want to work with.How many employees must you hire?On which unique concept do you want to work? You must have an idea for all of these before you even start a new IT-related company. You can say that an idea is a thing you are very passionate about, your dream, or a goal that you want to achieve. There must be a sort of uniqueness to your idea, and you must have a vision for your company. You should also possess potential knowledge about your market.

Prepare a Business Plan

A business plan is indeed a roadmap for your business’ success, especially if we talk about IT. There are many portions of a business plan, but the most important one is the executive summary. It tells the location of your company, what you plan to do to develop it, and why you think your business idea will be successful. If you want to attract potential investors, the executive summary is also a great opportunity for you.

While talking about the business plan, you must consider the following points:

• The mission statement gives an overview of your business goals.

• Company Information: It gives information about when the business was formed, who is its owner or founder, where it is located, and how many employees it has.

• Company Growth: The entire history of the company’s growth, including a financial snapshot

• Your Products and Services — Describe the services provided by your IT firm.

• Financial Information: If you are in search of investors, this portion will mostly include your bank statements.

• sum up future plans—Your future business plans and goals

protecting your business idea.

It is a natural phenomenon that your idea can be stolen. But it is also a reality that you can’t turn your idea into reality without the help of others. There are some valuable ways to protect your idea from being stolen. If you are hiring professionals or dealing with any other IT company regarding building your website or developing software for you, check their track record first. That is how they deal with things and what their preferences are.What do their previous clients think of them, or in other words, what is their feedback?

To protect a business idea, please use the following tools:

Non-disclosure agreement (NDA): As you are sharing information about your idea with them, an NDA is an agreement between two parties not to share information with third parties, or it can go one-way (sin). You can also set the expiration date to infinity.

Non-compete agreement: If you hire someone to help you, have him or her sign a non-compete agreement. A non-compete agreement prevents an individual or entity from starting a business that would compete with or threaten yours within an established radius.

Work-for-hire agreement: If you hire someone to develop your product, make a work-for-hire agreement to ensure that you own all of the customizations to your idea. You own anything that comes up.

Determine the risks associated with an IT company.

You must have intensive knowledge and working experience in the IT industry as a programmer, developer, or designer before you even think of starting a software company. You must be a perfect project manager as well. After that, a lot of risks are also associated with a software company, as with other businesses. If you can’t find the ideal staff or the best clients, and if you don’t have a constant flow of projects, then all your efforts can go in vain.

There is also a second scenario: if your company grows well, you are earning the best profits, but what happens when a few top-level employees leave your company? When they leave, your 10% of similar employees will also leave, and the entire scenario will change.I believe you understand my point.Similarly, you can’t guarantee the constant flow of projects, and even if you have launched your own products, you still can’t have a constant flow of sales through which you are funding your company. So, as the CEO of your company, you also have to tackle and go through all these obstacles.

Determine your pricing.

Now this is the most important portion of your business: the pricing. What price you will charge for your services, and what quality standards you will provide.Pricing varies by region and is determined by the complexity of the work.If your company is located in the United States, you will have different pricing than if it is located in India.

To determine your pricing, first analyse your competitors and what they are offering for their services. Again, the thing is, if you have extensive experience in the software industry, you will have a valid idea for this.

A business location or virtual office could be the best choice.

Your company’s location would be such that it could be easily accessible. Your clients could reach you easily. Today, the concept of a virtual office is extensively expanding. People find this to be the most reliable and cost-effective way of starting a company because it has a very low associated risk factor. There is a very limited equipment cost, and you also don’t have to hire professionals to maintain the working state of networks and computers.

You will find a lot of such agencies on freelancing sites like Upwork, Elance, and freelancer.com. They hire programmers and designers remotely and pay them on a per-work basis. If they don’t have work, they don’t have to pay. The second advantage is that they built up a client base as well by getting projects from these sites.

Finance your business

Calculate the cost to start the company—the amount of money required to establish and run a basic setup. By going through the previous steps, you might have an idea of what it can take in terms of money. There are also a variety of loan programmes to finance your business, like Premier Business Capital, which offers the best and most reliable merchant cash advance services in the USA. The following is a list of the most common types of financing.
ACH Loans
Debt Financing
Grants
Equity Financing
Angel Investors
Venture Capitalists
Strategic Investors

Determine marketing

You will definitely want to reach out to more and more potential customers in ways that make them want to use your services. This is very important, especially when you are starting your setup from scratch before you have an established name. The first thing you should have, in terms of marketing your IT company, is a website. You can take a look at the sites of some established companies and observe how they have set them up, what SEO strategies they are using, and what sort of marketing-related personnel they have hired. You can then set your marketing plan on the basis of your past experience and research in the same market.

Getting your first project and maintaining a client base

Now that you have completed all the previous steps, it’s time to get started on your first project. If you are a software engineer or designer by profession, then you might have a previous customer base through which you can get projects, or you can get this through freelancing sites. You can also have an idea regarding developing and launching your own software product. Getting a project completed is not important; what matters most is delivering the best results.This is the point where your project management and quality assurance skills will come into play.

Maintaining a client base and a constant flow of projects is a major part of running and growing your IT business. Delivering the best results on time is a key to success in the software field. Some companies additionally provide on-going and long-term support in order to maintain a healthy client base.

Recognize your employer’s responsibilities.

You must know your legal responsibilities as an employer. While your business is expanding, now is the time to hire a professional or employee. If you are in the US, you also have to obtain an Employer Identification Number (EIN) or Tax Identification Number (TID) from the U.S. Internal Revenue Service. According to the IRS, you must keep a record of employment taxes for four years.You must be aware of the following three types of taxes, typically in the USA:

Federal Income Tax Withholding
Federal Wage and Tax Statement
State Taxes

After that, maintaining a healthy and productive workplace is also your responsibility as an employer. You should inform your potential employee about your company’s policies and environment before hiring him.