business-registration, india, bootstrappingIt’s been around 1year since I am working on my idea while testing it to the potential customers and all these work goes off paper. But now I am confident about my idea and decided to bootstrap with a fund of rupee 1l, so can anyone suggest me about the legalities regarding company registration, or can I run a business without registering a firm while bootstrapping and wait till it gains traction.
Kindly help !! Thanks.
No idea on how simple or difficult it is to set up a business in India… (A birdie in me tells me it’s probably not simple, given India’s administration’s reputation for being slow and complex.)
FWIW however, I’ve met a fair number of founders who wasted inordinate amounts of energy on administrative things that, in retrospect, were completely useless - and sometimes very costly. For instance by setting up shop without a modicum of market validation, by worrying about the intricate subtleties of corporate tax optimization, by having a designer iterate a gazillion times and then some on a logo, and so forth. To be honest, I can’t blame most of them for it. It’s perfectly understandable after all - indeed, reassuring - to project oneself in a rosy future where everything will go well and it was well worth the time.
But the truth is it often isn’t…
The time when you actually want to be worrying about registering your business often is when you have or are about to have a check with a name that’s not yours on it. Whatever your circumstances, make sure you register your business when it’s genuinely useful for you to do so. It needs to serve a well identified business purpose, rather than merely something you’re doing to flatter your ego.
Pro tip in passing: have an accountant or a lawyer do it for you when you do, to avoid wasting your time figuring out how to do it properly - because more often than not, something will go wrong if you do it yourself.
With the first paying customer you need a legal entity in order to issue an invoice. Of course, you can probably delay this, but then when the time comes to fundraise it’s way better to show numbers backed by real documents and proper book-keeping.
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