Velocity – the University of Waterloo’s leading entrepreneurship program – put this little gem of a workshop together Wednesday night. They invited two women, Genie Lyon, who is a lawyer with a practice of her own and an understanding of corporate law, and Alex Hardy, a partner at BDO Canada who talks about accounting with such a passion for it, to teach us the financial and legal basics of setting up a business.
All of us gathered on the topmost floor of the University of Waterloo’s EV3 building, in a cozy tutorial room repurposed as a presentation space. The chatter of introductions between attendees died down and Anika, Velocity’s Programs Assistant, introduced our speakers. But not before giving everyone an opportunity to introduce their business or current project to the group. A pleasant number of us stood up and gave blurbs about our businesses, which was nice because it established a nice sense of community within the group. And, since it was my first time at a Velocity event, I got a better feel of the type of crowd I was in.
Then we moved into presentations. Alex Hardy talked about the financial basics of setting up a business. Things like whether to register your business for HST (which you should, if for even the simple reason that it establishes a legitimate image for you), whether to incorporate or not, things to consider when hiring employees, the difference between contractors and employees (which makes this video make a lot more sense), etc etc. The best lessons I got from her were as follows:
- An idea on its own is not a business. You need to put it into action for success.
- Cash is king. If you can’t anticipate your cash needs and expenditures you will fail, so make sense of what your cash flow is and manage it. In other words, put effort into budgeting.
- If your business doesn’t make sales it doesn’t mean you won’t owe tax. If you win prizes to fund your business and some of that money goes unused, you can be liable for payments on that. So, do your research. Always.
Then Genie Lyon, a lawyer, talked to us about the legal aspects of a business (which I was somewhat new to, and it was really interesting). She introduced us to intellectual property rights, gave us the lowdown on trademarks, and went further into detail on the distinction between a contractor, employee and a volunteer (it matters more than you think!). The best lessons from her were:
- Be careful who you share your ideas with. Some people will break confidentiality agreements and, if you can’t afford a lawyer to enforce your rights, you are SOL. That said, it means you should trust your gut and do research on the people you entrust with sensitive information because a non-disclosure agreement won’t always protect you.
- Consider whether you really want to run your own business. Because if you don’t, you’ll be taking on a lot of responsibility that will be hard to step back from later. You’re better off selling your idea to someone else in that case.
- Read over any contract you sign. Watch out for high penalties for exiting said contract (you never know if you’ll need to), excessively long terms of agreement, and other stuff that sounds fishy. You don’t want to be trapped into terrible terms.
And finally, our leaders were asked what they saw young entrepreneurs do wrong when they start their businesses. Hint hint, things we shouldn’t do. Here were Alex and Genie’s top two:
- Entrepreneurs didn’t get adequate legal/financial consulting when incorporating or making contracts. It cost them more to fix their mistakes than they saved making them. So, moral of the story is to do things right the first time.
- Business owners mistook having a large following for guaranteed success. There’s a difference between a “fan” and somebody ready to put their money where their mouth is. So a) don’t get a big head when people tell you your idea is awesome and b) don’t count your eggs before they’ve hatched.
Overall the workshop was two hours well-spent. I learned a few useful things, and I also got to meet some really cool people (the networking aspect of any event is pretty worth it I think). Also, I know I’m breaking the cycle by posting on a Friday (usually Tuesdays and Thursdays only for now) but I couldn’t wait to get this recap up for you guys. Hope you enjoyed!
What was the most useful workshop you’ve been to this year?
Lots of love,