When starting up a new business, there are many costs you have to pay before you ever start charging customers for your product or services.
Corporate Filings. You will need to file corporation papers Inc., LLC or Partnership with your secretary of state where you are doing business. If you file them by yourself, it might set you back $500-$600 if you use an attorney, double it.
Legal Costs. In addition to incorporating a business, founders/partners should establish a shareholders' agreement. This will put the business issues out front before problems occur. Depending on how complex your business is, this can set you back a few thousand dollars. Expect to pay it.
Technology Costs. Unless you are a techie and know how to write code, if you have a business with a technology need, you will have to hire a custom development IT firm to build your business. Budget for 25% more than what you expect to pay. This is not cheap.
Rent. There is a reason why Steve Jobs and Bill Gates built businesses in their parents' garages - rent isn't cheap, but when it's your parents' house, usually its free. Keep costs low by holding out for free rent as long as possible.
IP/Patents/Trademarks. Even if you are the techie writing code for your business, if you want to preserve the IP, it will be imperative to start the patent process. This can be a costly, long process. Put aside $15,000 just to start the process with an IP attorney. Trademarks are less expensive, but will still cost you.
Technology needs. Who will host your website? Who will maintain it? What about email? Decide a service provider upfront that will suit the needs of your growing business.
If you are looking to raise capital for your start-up, remember to post the opportunity for FREE on The Deal League to gain access to angel investors, venture capitalists and family offices.