Would Your Hobby Be a Good Business Idea?

Some people recognize when their hobby could turn into a profitable business. Not everyone realizes the value of their own talent, though. If your hobby involves making or doing something people would pay for – sewing or landscaping, for example – maybe it’s time to consider making that hobby your job.

How to Get Started

Many aspiring entrepreneurs have full-time jobs. Leaving a full-time job to start your own business is a gamble, so the best approach is to start building your client base whenever you have free time. That might mean selling your product or service to people you already know, as you get established. (A guitar teacher interviewed in Entrepreneur magazine said he advises aspiring teachers to save enough money to cover four to six months of income and expenses before they leave their full-time job).

Use Available Resources

There are many resources available to small business owners. One that’s especially helpful is the mentoring program offered by SCORE. You can request mentoring for some specific aspect of your business or for general guidance.

SCORE offers webinars and small business workshops and has 10 locations in Maryland. During National Small Business Week (April 30-May 6, 2017), SCORE is partnering with the U.S. Small Business Administration to offer a special series of webinars online.

If you need seed money for your business, look at options available through the Maryland Department of Commerce. The department offers grants for certain types of businesses, as well as loans with favorable interest rates.

Talk to An Accountant

As your hobby evolves into a business, you will (hopefully) begin earning more money. Get professional advice from an accountant about your tax obligations and any business expenses you can write off. Many solo businesses pay taxes quarterly to avoid the burden—and associated IRS penalties—of one large tax bill each year.

An accountant can also provide advice about separating your personal and business expenses. For accurate recordkeeping, you will want to open a business bank account (and perhaps get a business credit card), rather than use your personal account for business expenses.

Talk to An Attorney

An experienced business attorney can tell you what steps to take to formally launch your business. For example, depending on the type of business you plan to operate, and where your business will be, you may need a license. You’ll also need to register your business name with the Maryland Department of Assessments and Taxation.

If you’re unsure which business structure is best for your business, an attorney can help with that, too. Whether you choose to be a sole proprietorship or limited liability company, you will want to consider whether that structure will work for your long-term goals.

One mistake some entrepreneurs make is partnering with a friend to launch a business but failing to establish legal rights and responsibilities of each business partner. Getting sound legal advice in the beginning, and over the years as your needs change, can help you grow your hobby into a successful enterprise.

Lusk Law, LLC, specializes in assisting entrepreneurs, helping to avoid litigation when possible, and we’re ready to actively represent our clients in court when litigation is necessary. Business owners in Frederick County, Howard County, Baltimore County, Baltimore City, Carroll County, Washington County, and Anne Arundel County, and throughout Maryland, Virginia and DC, can rely on us to handle their legal needs at start-up and throughout the life of their business. Please call us at 443-535-9715 or fill out our contact form if you have any questions about this topic.

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