Starting your own small business is a scary and exciting prospect. It can be the start of a whole new life, or simply an overwhelming idea. If you’re living in Seattle, Washington, and considering the possibility, you’re in a great location. Seattle has many resources to support the hundreds of small businesses that are cropping up all over the city every year. From applying for a business license and finding your perfect workspace, to finding investors and networking options, Seattle has everything you need to build a great business.
Thinking of Starting a Small Business in Seattle?
In Seattle, new business owners have the unique opportunity to live and work in a city of startups, small businesses, and entrepreneurs. As one of the fastest growing cities in the US, Seattle carries the aroma of exciting newness. There has never been a better time or place to join the excitement and develop your own small business
One of the resources available for small businesses in Seattle is ATLAS Workbase. It is a shared workspace, located between South Lake Union and Queen Anne, that is an ideal space to foster your small business. Because it has the heart of a startup, ATLAS offers many convenient amenities tailored to small businesses. There is no better place to start building your business in Seattle. The friendly staff and beautifully designed showroom space are optimized to encourage productivity.
Acquiring a Seattle Small Business License
Anyone doing business in Seattle needs to get a business license. It is that most important first step for starting your own business, whether it’s an LLC or a sole proprietorship.
You will need a license tax certificate for:
- Retail sales and services
- Providing professional or personal services
Seattle Business Licenses typically cost $55-$110 depending on the amount of revenue you expect in the year. It would cost more for a larger business. Your license needs to be renewed every year. Even if it expires, that doesn’t mean your business license is no longer active. You need to actually cancel your license if you decide to no longer run your business.
If you have a Seattle License Tax Certificate, you will need to pay your taxes quarterly, as well as yearly. Make sure you do this, or you will find yourself racking up fees, notices, and phone calls.
You can apply for a license tax certificate online, through the mail, or in person on floor 42 of the Seattle Municipal building. In most cases, applying in person will be the quickest route, as applicants receive certificates before walking out of the building.
Once you’ve done that, pat yourself on the back and celebrate with happy hour or fancy coffee. You are well on your way to starting your small business.
Where to Start Your Small Business in Seattle
Many newly-minted small business owners start implementing their business plans from coffee shops, libraries, or wherever they can find free WiFi. Bill Sechter and Alan Winningham, the co-founders of ATLAS workbase, worked out of coffee shops and coworking spaces while they were creating plans for their startup. Bill alone has worked out of hundreds of “third space” locations.
Because of their experiences working anywhere and everywhere, ATLAS Workbase is the ideal workspace for entrepreneurs. It integrates the strengths of independent coworking spaces, with a designer furniture showroom, and a gourmet coffee shop. It is optimized for productivity and collaboration.
Applying for Small Business Loans in Seattle
While it would be amazing to come up with a small business with zero upfront capital necessary. However, that’s typically not the case. Some entrepreneurs have the opportunity to save money ahead of time, or have built-in investors. However, most need to have a plan for coming up with at least part of the money.
The 5Cs are the elements that most financial institutions will want to know about before agreeing to a small business loan:
- Capacity/Cash Flow
Small business owners are usually expected to bring 25-30% of the start up costs. For expansion loans, owners are expected to have equity in the business equaling 25%. They can also combine cash and equity to reach at least 25% of the value of the business.
There needs to be evidence that the business owner has the experience and ability to start and run their business effectively. This evidence includes experience, training, and/or a management background. These should be combined with a thorough and well-developed business plan that projects cash flow and demonstrates profitability. The projection will need to show the ability of the business to meet financial obligations such as loan payments.
The new business owner may need to pledge something of value, such as business property, furnishings, fixtures, or inventory. This could also include the owner’s assets outside of the business, such as real estate or stock.
This is where the lender will look into the character of the small business owner. Can they take financial responsibility? The owner’s credit history will be reviewed and analyzed for credibility .
This takes into account conditions outside of the small business owner’s control. These include economy, industry trends, etc. Does the business model have what it takes to withstand unforseen adversities?
Funding Outside of Loans: Crowdfunding
If you have faith in the mass appeal of your product, and don’t want to worry about paying back a long term loan, crowdfunding may be a good option for you. For crowdfunding, founders typically present their product and business plan on a website, and allow consumers to purchase in advance of production. If they catch on, they can make millions. If they don’t catch on, they can fizzle in hours. Products that catch on usually have some kind of hook, or are something consumers have been asking for over several years.
Best websites for crowdfunding your entrepreneurial endeavor:
Successful Crowdfunded Businesses
What is it? wireless headphones
Amount raised: $3.4 million (in four campaigns)
The Dash is a pair of headphones that can play music, track steps, and act as a bluetooth headset. It’s basically a computer in your ear. The company is solid and is working to develop other products now that The Dash is a proven successful product.
What is it? modular gaming terrain
Amount raised: $8.2 million in four campaigns
Inventory costs were a huge burden for starting a business like Dwarven Forge. The company started out creating tiny hand painted pieces, which is why they went with a kickstarter campaign. The company has used several crowdfunding campaigns and is now moving toward broadening its audience so it can rely on a consumer driven business model.
What is it? quirky card game
Amount raised: $8.8 million
Exploding Kittens was arguably successful because it had the built-in fan base of game artist Matthew Inman, best known for his webcomic, The Oatmeal. The kickstarter was hoping to bring in $10,000. Instead, it brought in $8.8 million. Since then, 5 million games have been printed, there’s an iPhone app, and a second game was produced.
What is it? inexpensive 3D printers and ink
Amount Raised: $3.4 million
For M3D, it wasn’t about the media attention or having a loss leader. It was about selling printers for as low of a price as possible, without losing money. And they did that. They kept all of their manufacturing in the US to keep ultimate control over the design and distribution. The company now offers several products and is continually innovating the 3D printer.
Funding Outside of Loans: Investors
An investor is someone who invests capital in a company with the expectation of a future financial return. Investors choose businesses that they believe will be successful. They may also invest in businesses where they have passion and want to play a passive part in the development. They may either take on partial ownership of the company, or they will receive a return on their investment.
In the simplest of terms: most small business loans have regular payment plans which do not take into account the state of your business. Most investors are paid back as the business is successful. Investors are a great way to gain working capital for your business with a more lenient repayment.
Some Groups in Seattle that Connect Business Owners with Investors
- Alliance of Angels
- Bellingham Angel Group
- Tacoma Angel Network
- ZINO Society
- Portland Angel Network
- Seattle Angel Fund
- For small business owners who are women and/or minorities: Linked Deposit Program
Finding an Office in the City of Seattle for a Small Business
When starting a small business in Seattle, you need a place to call home. While you can lease a space in an office building, and sign your life away with a contract, we would suggest the new trend in business: the coworking space. ATLAS Workbase is a shared workspace located conveniently between South Lake Union and Lower Queen Anne. embers only pay for as much space as they need. That means that you can scale your membership as your business grows. You can start working from the space alone, for a few hours a week. Then, once your business has employees and regular meeting space needs, those can be easily met.
ATLAS offers a wide variety of work spaces from standing desks to meeting rooms and work pods. No matter how you may want to work on a given day, ATLAS can provide that.
Not the least of the resources offered by ATLAS are networking opportunities and events. These are priceless for small business owners because they offer the opportunity to interact with people who can add value to your business. Whether you want to talk to an accountant, a consultant, or another entrepreneur who has been exactly where you are, ATLAS members are always ready to chat and offer advice.
How Seattle Small Business Consulting Can Help
As mentioned before, starting and maintaining a small business can be daunting and scary, particularly if you are doing it on your own. Whether you have a partner, employees, or are building your business on your own, a small business consultant might be a good idea for you. Typically small business consultants specialize in specific areas that bring value to a company such as marketing and/or sales, management techniques, and business strategies. They often have the tools to take a look at your business, make suggestions, strategize, help you save money, and identify mistakes before you get in too deep.
Small business owners usually hire consultants to bridge a gap in skills within their own company. They also hire consultants to bring an objective perspective to the company.
Here are some ways a small business consultant can help:
- Identify problems – A business may be demonstrating symptoms of a problem, but it’s difficult for those deeply invested to track down what is actually causing the problem. These may include a decrease in sales, lower rates of productivity, or cash flow issues. A small business consultant can look at those symptoms, run tests,and make objective observations about the root of the problems.
- Create Solutions – Sometimes defining what will resolve serious problems in your company is beyond the scope of founders and/or employees. Hiring a consultant to define the problem and the solution is a great way to go.
- Optimize – A consultant comes in with a fresh and objective point of view. What may look like a mess of information to you will be a puzzle that the consultant can solve. It will be easier for them to make necessary hard decisions based on the facts of your company and they’ll be able to look outside of the box to find resolution for you.
Here are some great consultants in Seattle:
Loft9 (http://www.loft9consulting.com/) – They offer business consulting and strategies, project management, and general process improvements.
Unifying Consulting (https://www.unifyconsulting.com/) – They offer business organization and consulting based on data-driven insights.
NyeCo (http://www.nyecoinc.com/) – They specialize in problem solving for processes, people, and technology. They achieve results by fostering leadership and growth.
NW Business Consulting (http://nwbusinessconsulting.com/) – They have a five point process for getting businesses ahead. They specialize in managing cash flow and encouraging growth.
Finding a Small Business Accountant in Seattle
When asking for advice on small business, the first thing you will hear from most entrepreneurs is “find an accountant.” Every business, big or small, needs at least one accountant. They are the point person for knowing whether your business is doing well, treading water, or should file for bankruptcy yesterday. They have an objective overview of everything happening in your business based simply on numbers.
Many small business owners think that they should hold off on hiring an accountant to save money. However, when you consider how long it takes you to do a task like filing for taxes, consider whether it is really worth it not to have an accountant.
You also don’t need to hire an account full time or on retainer. If you have a contact who can do your accounting for a couple hours now and then, that might be the best way to go.
In Seattle, the best way to find a good accountant is through Yelp. There is a lot of information, with dozens of accountants to choose from, and plenty of reviews to guide you.
Building a Brand/Marketing Your Small Business
Almost as soon as you’ve decided what you are going to sell, you want to find an identity for your business. What sets your product apart from similar products? Customers form bonds with companies based on how they present themselves, so definitely consider what you want your brand to be early on in the process.
Here are some ways businesses build their brands
- Social media presence/voice
- Logo/design elements
- A specific product hook
- Spokesperson (for example the Geico Gecko)
Attending the Small Business Expo in Seattle
The Small Business Expo is a convention where small business owners can meet and network, find employees, and consultants. It’s a great resource for small business owners, or perspective owners to find resources, listen to 20+ talks, and learn. It’s happening at the Seattle Convention Center on August 11th, 2018. 3,000 people are expected to attend.