The document provides a 6 step process for starting a business which includes developing an idea, assessing personal finances and credit, creating a business plan and budget, formally registering the business as a legal entity, and obtaining necessary licenses and permits. It also discusses factors for securing a loan like collateral, credit score, capital, character, and capacity to repay. The steps are described in detail providing guidance on tasks within each step.

1. BING BANG!
First Steps to Starting your Business

3. How to start your OWN Business?

5. 6 STEPS
1. IDEA
2. PERSONAL FINANCES
3. BUDGET
4. PLAN
5. FORMALIZE
6. MANAGEMENT

6. 1. IDEA
Personal
•What type of business do you want?
•Am I ready for the investment of time and money?
•Am I ready for the responsibility?
• Impact in my life style
• List of advantages and disadvantages

7. PERSONAL INVENTORY OF YOUR
SKILLS AND EXPERIENCE
What: I know, I should know, I need to learn
• Product/Service
• Industry
• Operations
• Promotions/Sales (Language)
• Financial Records
• Legal Aspects

8. 2. PERSONAL FINANCES

9. Important Factors for Securing a
Loan
Collateral
Credit
Score
Capital
Character
Capacity
to repay
Conditions

10. Credit Score
• What is credit?
– An asset that allows you to access many different resources,
both financial and non-financial
– A point system between 300-850 that reflects your history of
repaying your debts and how you manage your credit
• Why is credit so important?
– Financial institutions use your credit score to determine if you
qualify for a loan, the interest rate you will pay, and the term of
the loan. Employers, educational institutions, and landlord are
other parties that may use your credit report.
– Your business partner’s credit report plays a role in securing
financing

11. Payment History
35%
Balance on
Accounts
30%
Length of History
15%
New Debt
10%
Types of credit
10%

12. Capacity
• LEDC takes a holistic look at your ability to
repay a microloan
• If you are a start-up business, do you have an
additional source of income that will support you
during the initial start-up phase?
• If you are an existing business, what does your
historical data show and how will these profits be
maintained? Do your business financials show
positive cash flow and a positive net equity?

13. Capital and Collateral
• Capital: How much of your own money have you
invested in your business? (Your owner’s equity)
• Your owner’s equity or contribution represents
your commitment to the venture
• Collateral: a third source of repayment.
• LEDC secures loans with lien-free car titles and
business assets

14. Character and Conditions
Character
• Thorough understanding of your business model
• Clear articulation of size and purpose of loan
• Straightforwardness about financial situation
• Number of years of industry experience
• Quality of references
Conditions
Current economic climate of industry in which
business is operating

17. 4. PLAN
• Write a business plan
• Why?
- Organize your ideas
- Focus your efforts
- Create a common vision
(partner)
- Ask for financing
- Gain confidence of the
viability of your
business- sustainable
- Maximize your chances
of success

18. BUSINESS PLAN
•
•
•
•

19. $10 martini-and-manicure special—which
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These fish can completely get rid of skin
smear and aging cortex

21. 5. FORMALIZE
1. Register de business/Legal entity
2. Register with the IRS for taxes at the federal
level
3. Register to pay state’s taxes
4. Licensing and permits

22. • REGISTER YOUR BUSINESS
The Dept of Consumer and
Regulatory Affairs
www.dcra.dc.gov
• 941 North Capitol Street, NE,
Washington, DC 20002
• Tel: 202-442-4400
• GET A FEIN
• Register your business with the
IRS to pay taxes to the federal
government and to open a bank
account. For more information
visit: www.irs.gov
• STATE’S TAXES FOR DC
• Register with OTR (Office of Tax
&Revenue) www.otr.cfo.dc.gov
• LICENSES AND PERMITS
Department of Consumer and
Regulatory Affairs
www.dcra.dc.gov

24. 6. MANAGEMENT
Insurance
Consultants
Update your abilities

25. • Marla Bilonick
• mbilonick@ledcmetro.org
• 202-540-7412
• Rossana Espinoza
• respinoza@ledcmetro.org
• 202-540-7416