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INTRODUCTION

One often-overlooked business imperative is infrastructure. Business infrastructure forms a foundation from which a successful business can be built. It requires research, access to capital, use of standard business practices and work processes, and assistance from individuals with a variety of professional expertise.

Aspects of business infrastructure include the following:

  • Business structure

  • Obtaining startup capital

  • Planning

  • Putting together a team

  • Following rules and regulations

  • Obtaining professional expertise

  • Tax-planning and record-keeping

  • Managing risk

  • Technology (acquisition and implementation)

This chapter covers each of these topics.

TYPES OF BUSINESS STRUCTURES

Typically, one of the first tasks is to select the type of legal entity required to operate a business. Examples of types of business infrastructure include the following (U.S. Small Business Association, n.d.):

  • Sole proprietorship: This is a basic business structure in which the owner is responsible for the assets and liability.

  • Partnership: This business structure offers a variety of options, depending on the type of business and number of partners.

  • Corporation (C or S): This business structure offers differing liability and tax protection depending on the size and scope of services or products offered.

  • Limited liability company (LLC): This business structure is somewhat more flexible than a corporation, while limiting the liability of the owner(s).

  • Cooperative structure: This business structure is designed to meet a need related to service or products via membership.

Depending on the nature of the business, each structure offers various advantages and potential disadvantages, particularly relating to legality and taxes.

Online Resources

For more information on business structures and other resources, see the following:

“Success usually comes to those who are too busy to be looking for it.”

–Henry David Thoreau

OBTAINING STARTUP CAPITAL

Startup capital is required for almost any business. This capital may come from formal resources (bank loans, venture capital, angel or other investors) or from self-funding. Either way, obtaining capital is often among the most challenging parts of starting and/or being in business—a state made more frustrating by the fact that access to capital provides many ...

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