MYTH #1: I don’t have to register my business since it is small.
TRUTH: You do!
Registering a new business is a statutory requirement; it has nothing to do with the size or age of your business.
MYTH #2: There are all kinds of government grants and loan subsidies for people who want to start small businesses.
TRUTH: Not really.
Government grants for starting small businesses are usually earmarked for special groups of people or business ideas or particular regions/economic areas of the country. (To get more of an idea about the kinds of grants that are available, read http://www.venturecenter.co.in/funding/)
MYTH #3: Since I am not planning to raise any funding, I don’t need a business plan.
TRUTH: You do!
You need a business plan. It serves as a roadmap and will give you a clear picture about your mission, your budget and strategy for your business.
MYTH #4: My business idea is great and unique. I should get funding right away.
TRUTH: It is not so easy!
A product/ service idea is considered “fundable” only when a test model can prove that consumers will be willing to pay for it. Also, unless your business has a rock solid business plan and expected robust growth ahead, sourcing funding can be a challenge.
MYTH #5: I can worry about financial management and tax planning when I start making profits.
TRUTH: No way!
All businesses need to prioritize financial resources well ahead of time. Growth needs cash. You do not want to discover that the business has run out of cash at a critical time or that certain expenses are not tax deductible under the tax laws after you are neck-deep in your business.