You’ve Started a Company. Now What? The Startup Mistakes No One Warns You About
The early financial, tax, and compliance mistakes founders make after launching and how to avoid them before they get expensive.
As we welcome in the summer this year, I’ve had the pleasure of seeing so many of the wonderful aspiring founders I’m working with at NGEN finally take the first step to launch their ventures.
Some are prompted to action by raising their first investment rounds. Others are working on their ventures full-time over the summer instead of doing an internship, or now that graduation season has wrapped up. A surprising yet welcomed number of them are bootstrapping their ventures.
All of them, however, have similar challenges with launching that I thought would be helpful to note down.
So whether you’ve just launched your company, or if you’re planning to, here are some of the basic housekeeping conversations, documents, and tasks that you need to be thinking about.
1. Creating Your Budget & Projections
So many brilliant founders I’ve spoken with, both those who’ve raised capital and those who are bootstrapping, often forget to come up with a clear month-on-month budget for their expenses.
Most founders either avoid creating an outline of their finances or attempt to make a perfect 50-tab financial model that doesn’t actually give them any usable information.
This is a problem because your startup’s financial reality is rarely just “how much money do we have in the bank?” It’s how much money you have, how quickly you’re spending it, what fixed costs you’ve accidentally committed to, what tools you’re subscribed to, what contractors you’re relying on, and how much runway you actually have before you need to raise, sell, or cut back.
Even a very simple budget is better than no budget at all. You should know what your expected monthly spend is, what your committed costs are, what expenses are optional, and what revenue or funding you’re expecting to come in.
2. Keeping Receipts & Financial Records
One of the most underrated early habits for founders is simply keeping clean records of where your company’s money is going.
This sounds obvious, but so many founders wait until tax season to start hunting through their inboxes, bank statements, Stripe receipts, personal cards, and random screenshots to figure out what they actually spent money on. By then, it’s not only stressful, but also much harder to know what was a business expense, what was personal, what needs to be reimbursed, and what documentation you’re missing.
My advice to founders is always the same: start setting up these systems from the moment you incorporate, or at least from the moment you start spending through the company. Keep your receipts, track your invoices, record reimbursements, and make sure you have a simple process for documenting money going in and out of the business.
Even if your expenses seem small at the beginning, clean records make everything easier later: taxes, bookkeeping, investor diligence, grant reporting, and even just understanding whether your startup is actually spending money wisely.
3. Understanding Tax & Compliance Deadlines
With tax season wrapping up at the tail end of April, I heard questions from recently incorporated founders about whether they needed to pay corporate franchise taxes, income taxes, and more. Worse still, many founders only start asking these questions when deadlines are already coming up.
Depending on where and how you incorporated, there may be annual reports, franchise taxes, income tax filings, registered agent renewals, bookkeeping requirements, and other compliance deadlines you need to keep track of.
This is why it’s worth speaking to an accountant and/or bookkeeper early, even if your company is pre-revenue or barely spending money. You do not need to become a tax expert yourself, but you do need to know what applies to your company, what dates matter, and what information you need to prepare ahead of time.
4. Founder Compensation & Separating Personal/Business Finances
This is probably one of the things that most solo-founder friends of mine struggle to get right in the beginning.
Once you’ve incorporated, your company is its own entity, so you need to be thoughtful about how money moves in and out of it. Set up a business bank account, use a dedicated card, and avoid casually mixing personal and company expenses.
If you’re paying for company expenses personally, track them properly and reimburse yourself through a clear process. If you’re putting money into the company, know whether it’s being treated as a founder loan, capital contribution, or something else. If you’re paying yourself, understand whether it should be salary, distributions, reimbursements, or another structure based on your company setup.
Final Thoughts: If You Need Help…
TL;DR: Getting incorporated is easy. Staying compliant, managing your finances properly, and avoiding costly mistakes is where many founders struggle.
If you’re wondering where to get started, my co-founder, Mathura, a Chartered Accountant and startup advisor, is hosting 5 virtual coffee chats for founders to understand what happens after you incorporate a US company.
She’ll cover during her coffee chats:
The financial responsibilities that come with running a company
Key tax and compliance requirements founders should know
Common mistakes that can become expensive later
How to set up your finances properly from day one
Basic systems to help you manage your startup as it grows
I’d highly recommend booking a time to chat with her to at least understand what are the things that you need to be thinking about on Day 1 of your startup to set it up for long-term success.
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