Side Business Setup

Side Business Setup Skill

New side businesses fail setup in both directions: six weeks on a logo and an LLC for a business with zero customers, or a year of real revenue flowing through a personal checking account with no records, no terms, and a possibly-violated employment contract. The right order is boring and short: check the employer conflict first, separate the money immediately, get paid under simple written terms, keep records from dollar one — and let the structure question (sole proprietor vs. LLC vs. local equivalents) be decided when the facts justify it, with a professional, because it's jurisdiction- and situation-specific.

What This Skill Produces

• The ordered sequence — what happens this week, this month, and at the first real milestone — with the wait-list labeled as such
• The employer-conflict check — the contract clauses to reread before anything else (IP assignment, moonlighting, non-compete)
• The money-hygiene rules — separation, records, and the tax-setaside habit, from the first dollar
• The structure framing — what the sole-prop-vs-entity choice actually trades, when it becomes worth deciding, and the route to local professional advice

Required Inputs

Ask for these if not provided:

• The business, concretely — selling what, to whom, revenue so far or expected; liability texture matters (advice and physical products carry different risk than selling prints)
• The employment situation — employed? The contract's IP-assignment and moonlighting clauses are the first read (using employer equipment or work hours for the side business is the classic self-inflicted disaster — asked directly)
• Jurisdiction, loosely — registration, tax, and entity rules are deeply local; every such step gets typed and verify-locally flagged
• What's been done already — revenue flowing? Then money-separation is behind schedule and jumps the queue

Framework: The Order Rules

1. The employer check is step zero: reread (or obtain) the employment contract for IP assignment ("inventions made during employment" clauses vary hugely in scope), moonlighting policies, and non-competes; never build on employer time or equipment. Conflicts found → resolve before investing more (sometimes a simple disclosure/waiver; sometimes a lawyer question — routed, not guessed).
2. Separate the money before the second sale: a dedicated bank account (a plain second account works before any entity exists) — commingling makes taxes miserable, records unreliable, and (where entities exist later) undermines the liability protection people form entities for. This is the highest-value 30 minutes in the whole setup.
3. Paper beats structure early: simple written terms with every client (scope, price, payment terms — see first-client-contract) and an invoice-and-records habit (see quarterly-tax-rhythm) protect against the common failures; entity structure protects against rarer ones — the order follows the odds.
4. The structure question, framed honestly: sole proprietorship (or local equivalent) = zero setup, no liability shield, fine for many low-risk starts · an LLC/limited company = a liability shield if formalities are kept (separate finances — see rule 2 — contracts in the entity's name), real costs and filings, and jurisdiction-specific tax texture. Triggers that make the question ripe: meaningful liability exposure, real revenue, contracts that demand an entity, a partner joining. The decision itself: framed here, made with a local accountant/attorney — stated plainly as the skill's boundary.
5. The wait-list is permission, not dismissal: logo, website polish, business cards, merch, office — all legitimate after there's a customer; the skill names them as morale, not milestones, and nobody has to feel bad about wanting them — they just don't block the first sale.