5 Business Lessons I WISH I knew when Starting!
I registered my first business Okenyon Webs Ltd back in 2013.
Since then, I’ve gone on to register and be part of another 4-5 companies, but prior, I ran my internet business as a newcomer and had to learn the hard way.
Below I’ve listed the 5 most important lessons I’ve learned over the past several years in growing and sustaining profitable businesses online.
I openly admit I’m far from an experienced businessman or online entrepreneur, but I have built several six-figure companies in a short space of time and I’ve personally had to teach myself everything I now know.
If I’d known about these 5 things prior to me creating my first business or if someone would have sat me down and gone through the following, it would have saved me a LOT of money, time, and stress, and it would have given me so much more clarity.
The thing in business, especially in the UK, is that NO ONE helps or tells you a thing!
If I were starting again today, I would pay good money for the list below, so even if you’re thinking of getting started or currently making money online, I advise you to study the points below and take action ASAP!
Get a Good Accountant
Simple enough, right? Wrong!
I’ve seen so many people, especially over here in the UK, running their internet business wrong. If you’re making any amount of money online and still trading as a sole trader, you’re a fool! Going limited was one of the best things I’ve ever done business-wise. It’s quite daunting at first when you’re used to keeping all the money you earn and paying self-easement tax, but – trust me – it’s worth it!
- Yes, it’s a bit more work.
- Yes, it’s a bit more of a pain to draw out money.
- Yes, it costs more in accountancy fees.
However, the positives more than outweigh the negatives.
Not only does it look more professional, but ultimately if you’re sensible with your money, it will also save you thousands in tax.
You need to find the right accountant.
I’ve used several in the past and started with a large accountancy firm as I thought they’d be by far the best! I was so wrong. Find someone who knows what they are doing, but who’s also personal. Someone you can email and have a reply in the same day, someone you can walk round to visit if needed, and ultimately someone who wants to encourage you to grow your business.
A good accountant will realise that the more they show you how to grow your company and profits, the more they earn. It’s almost a partnership!
My new accountant saved me over £3000 in tax in my first year as a registered company. See why these points are so valuable?!
Go limited, play by the rules, pay on time, and get someone you can rely on as a partner to grow your company and ultimately make you the most money.
This leads me nicely onto my next point….
Benefit from Entrepreneurs’ Relief
Before I had my current accountant I had never heard of the above. Maybe some of you reading this haven’t, and if that’s the case, great because this will be something worth taking away from this article.
Entrepreneurs’ Relief is a scheme set up by the UK government to reward entrepreneurs for starting and growing their own businesses.
You see the trouble is, not many people know about it! If it weren’t for me finding my new accountant, I still probably wouldn’t myself. See how already point one could have saved me thousands if I’d known about it?
Why do not many people know? Because young entrepreneurs don’t get ANY help. Not only that, but also why would the government openly advertise a scheme that makes them less tax income on the sale of your company?
In short, if you’re a partner or owner of a limited company that has been trading for at least 3 years and you decide to sell the company or your shares, you can claim entrepreneurs’ relief. What this entitles you to is the privilege of only paying 10% tax on the profits of sale. This is a HUGE saving compared to the normal 28% tax you’d normally pay when selling a company.
See this blog post may have just saved someone 18% tax!
This statement again goes to back up that you should register as a limited company ASAP in order to get those 3 years underway. If only I’d known that years ago when I first started making money online!
You can find out more details at https://www.gov.uk/entrepreneurs-relief/eligibility about entrepreneurs’ relief. I know this just relates to the UK companies and personnel reading this, but I advice you to find a decent accountant and ask them what schemes you could benefit from in your country of residence.
Be Sensible with Money
I’ve seen this personally SO MANY TIMES!
So you’re in year one of making money online, and you’ve just stumbled across this incredible way of making money for yourself! That’s amazing!
What do you do? Go out and treat yourself by spending your money on the latest car or partying the money away because it’s always going to be there, right? Wrong again!
It may sound like I’m ranting now, but I’ve seen so many people fail, and I’m almost so angry that there’s little to no help for young business owners out there.
The problem is that the method you stumbled upon WILL dry up and so will your income. The even bigger problem is that a year down the line the tax man will come knocking on your door for his percentage of your profits! Oh shit, that money sat on your drive in the form of a new car or pissed up against a wall after too many nights out on the town partying.
You have to be sensible with your money.
It’s great to treat yourself now and then, but always be thinking about that rainy day. Make sure you’re saving and reinvesting a large amount of your earnings on your business and ALWAYS put away your tax money straight away. This all ties back to finding the right accountant, but I want you to be aware that rainy days WILL come and you need to be sensible enough to be able to have the funds to cover them.
Otherwise, it’s back to McDonald’s you go, flipping burgers for minimum wage! Who cares if you turn up in that nice car now?
Don’t be cheap!
Okay, so this isn’t meant to contradict the above. There’s spending money on shit, and then there’s spending money the right way.
Back when I started creating websites online, I wanted the quickest and cheapest way to build the best and technically amazing website. I cut corners, I found cheap plugins, I used unsupported integrations, I hired cheap designers, and so on. Ultimately, it got me nowhere fast.
Pay cheap, pay twice!
My partner’s brother taught me the above saying, and never have I related to it more.
If you pay cheap for something online, it usually is exactly that!
The sites I had first built are now non-existent because they lasted about a day. If you hire cheap freelancers, you’re running a huge risk of having to pay someone to do everything again at a higher rate. Wouldn’t you much rather pay the higher rate in the first place and save all that hassle?
This is a lesson you’ll either read here and learn from, or find out the hard way in time.
Everyone online will go through the stage whereby they want everything all singing and dancing and will want to pay pennies for it. Ultimately, all you’re doing is wasting your money. THESE FREELANCERS ARE CHEAP FOR A REASON! I would have saved myself literally about £20,000 if I’d had a company like my own Landing Page Guys when I first started online to build my websites.
I can’t count on one hand how many failed sites and projects I’ve wasted money on due to the quality of work.
Invest your money into good quality work and it will pay dividends in the future. Don’t cut corners or be cheap!
Speaking of not cutting corners….
Invest in Server Backups
Another HUGE liability when you first start growing as a business online is to overlook your hosting and security. Not only that, but you also won’t be educated about backups or server security. Often you’ll try to cut corners and serve your sites on the cheapest possible hosting packages available.
Well, let me tell you this. If you have something online you value that makes you money, BACK IT UP NOW! Seriously STOP reading this article and make a back up!
I have personally had one of my old servers hacked and they wiped the lot! I was too naive back then to look into creating backups and thought, as many of you reading this did, “It will never happen to me”. Well it did, and another £xxxx lesson learnt!
When someone hacks your server and you don’t have back ups, not only do you have to pay a hosting manager to sort the server out, you also lose everything you’ve ever put on that server. Oh, and then you have to pay to get it all recreated, redesigned and reprogrammed.
You’d be amazed, just last week over at Landing Page Guys we had one of our biggest corporate agency clients come to us saying they’ve been hacked and lost everything! A company turning over millions, without having backups set on their server! Crazy, right? But it’s easily overlooked!
The best way to set up backups is to contact your hosting provider and see if they offer them, but I would ALWAYS advise also running remote backups. A good company I can recommend for servers and backups can be found on my resources page.
Another huge lesson I wish I’d have known about years ago.
Now you can likely tell with the tone I’ve taken in this blog post that I’m sitting here angrily writing this post, but it’s because I feel hard done by as I was NEVER told any of the above. Those of you who choose to take action after reading this will prosper and one day maybe remember this post, and those of you who don’t will end up like me in 3 years time, with thousands of pounds lost for no reason and pissed off you hadn’t been told about the above…..oh wait, you have!