According to the Financial Times, the UK is the world’s second-biggest financial centre in the world. And with all of that talent around, the idea of setting up your own business can be very tempting.
Let’s face it, most of us don’t go into the world of work to line somebody else’s pockets. And for those who work in the finance industry, there are many options open to you if you want to start your own business.
If you are already working in finance you’ll almost certainly have some sort of idea of how to run a business from a financial point of view, and this is one of the reasons why setting up on your own can be ideally suited to you.
Although it might sound like a good idea to go out on your own – either changing career or doing something that you are already doing – it’s not easy! It requires a lot of hard work and commitment, long hours, and a lot of preparation. But if you can make it work, the personal and professional rewards can be enormous!
Below I’ve listed the four things you need to consider if you’re thinking about starting a business in the finance industry, from training all the way to the legal structure of your company.
If you are changing career, or even continuing with what you are already doing, you might need some extra training. To run your own business in the finance industry it’s likely you’ll need to have professional qualifications, such as CeMAP if you are a mortgage advisor, CIMA or ACCA if you are an accountant, depending on what your business is.
It’s essential you have the right qualifications in your pocket before you set up your own business as without them it is quite likely you won’t be allowed to practise. This will ensure you have all of the knowledge required to carry out the work or service, giving your fledgeling business a good chance for success.
2. Business Plan
Before you start out it is also important you have a detailed business plan. This will help you to understand how you are going to be able to make enough money to survive and prosper, and whether the business could actually be a success.
The secret to a well-run business is good planning and with a good business plan you can get a good broad view of how your business will work, as well as being able to drill down into the fine detail.
Remember, what you do isn’t set in stone and you can always change it as you go along.
Most people who start their own business will need some sort of help with financing it. Bootstrapping – financing it yourself – is the most desirable method as you stay away from loans from finance companies. However, bootstrapping isn’t always possible for everyone.
There are other options to getting financial help to start your own business, and it is important to know how much you need before you start looking.
Grants can sometimes be awarded by businesses or the government to help young businesses get off the ground.
Crowdfunding is an increasingly popular method of getting finance for start-ups. In crowdfunding, you can request small donations from people to get the money that you need. The money is only taken from them if you reach the amount that you need.
Banks can offer you a business loan, although they will usually need to see evidence that you have also invested some of your money before they offer it to you.
Loan companies can offer you money to start a business but are notorious for charging high rates of interest. Make sure that you check the detail in your loan agreement before going ahead.
4. Legal Structure
You need to think about the legal structure of your new business, as well as a business name.
Some of the structural options include:
- Sole proprietor
You should look carefully into each option to decide what’s best for you.
Once you have decided on your business name and legal structure, you can go ahead and register your new business with HMRC.
Setting up on your own in the finance industry can be a daunting task. However, if you have the right training and a good business plan, there is no reason why you can’t be successful. So take the advice from this article and begin the journey of starting your own business!