Starting Up a Business in Australia
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To start a business in Australia, government regulations require that companies comply with a number of legalities:
- Registering the company's name
- Australian Business Number (ABN)
- Tax File Number (TFN) and
- Pay As You Go (PAYG) withholdings
But before dealing with all the legal and state technicalities, aspiring entrepreneurs must plan for their own success. Part of this planning includes the development of a proper business structure.
By mapping out sales projections, operating costs and development strategies, entrepreneurs are able to attract investors, which is the next phase of starting a business - securing funding. Banks and other lenders offer a range of business loans including overdrafts, lines of credit and fully drawn advances.
Private investors and venture capitalists are also a growing source of start-up capital for small Australian businesses.
Over the last few years, private investments have grown substantially in Australia.
The key to a great private investor-investee partnership is finding a good match, industry knowledge and connections. The ideal arrangement for start-up business is having secured funding.
Private investors, in turn, look for growth potential, fair priced equity (ownership in the company in the form of stocks), skilled management, a tight business plan and what value they can bring to the company. Since private investors are willing to take such a high risk, they usually look for a high return (upward of 10 to 30 times the original investment) within a five to ten year period and with a defined exit strategy in place.