Beyond the idea: the admin involved in starting and growing your business

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Should you read this?

Are you considering founding a business? Is this your first time working at a startup? If so this article talks about some of the not-so-exciting stuff that you may need to get your hands dirty with. At a startup, roles and responsibilities can be very fluid and sometimes things just need to get done. You might find yourself working on social media in the morning, your VAT return in the afternoon and onboarding a new hire in the evening - in between each of these (distracting) tasks you’re trying to progress the core idea of the business. It can feel overwhelming as you discover all the stuff that has to get done which has little to do with the startup’s mission, but you will get a handle on it and once you do, you can start to prioritise, streamline and delegate.

Spoiler Alert: When founding or working at a startup you’re going to spend an awful lot of your time on things that don’t directly push the core business forward. Lots of these things can be frustrating at first as they feel like unnecessary distractions from the main show. There is a important balance to strike to ensure that these important “admin” items are not neglected and come back to bite the business in the future and at the same time focusing on driving the core idea and creating value.

Below is one of the drier articles in my blog, there’s not much by way of pictures or exciting code samples - even reading this article kind of reflects how tedious some startup operations can be. I hope you find some of useful information below which help you get to grips with the admin side of startup life.

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Introduction

A lot of us have considered starting a business at one time or other. We find ourselves getting excited by the prospect of working day and night on an idea we think is important, valuable and full of potential for ourselves as an entrepreneur and for the world at large. We obsess over the product, the business, the market and dream of creating something meaningful. What we spend less time thinking about are the more mundane, operational and administrative tasks that if not managed or delegated correctly can become a massive time sink that ends up keeping you away from the reason you started the business in the first place.

In this article I walk through many of the non-core activities that I’ve been tasked with during my time at various startups. The sections below are not in any order of importance, rather I’ve gone through my notes, emails and files and grouped the various tasks. For some tasks I mention suppliers and tools that I’ve used, I have no commercial relationships with any of the companies mentioned and am by no means endorsing them, I only mention them as a potential starting point for your own research.

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Naming and “owning” your identity online and offline

One of the first things I got excited about was coming up with a name for my company. The actual name of the company came to me whilst eating at a Hawker market in Singapore. However much of the online namespace for “Hawker” was taken, including the web domain and socials. I eventually settled on adding a “k” in the name and named my business Hawkker.

For a consumer-facing business I think the name you choose should be influenced by the availability of web domains, social handles as well as the SEO and trademark landscape. You might have a name in mind that you love, but if the distinctness online and offline isn’t great it might be worth thinking again. Don’t obsess over a specific name, many of the biggest household names sounded ridiculous when they were young. If your company sells to other businesses (not consumers) then the your name might be less important as marketing to commercial customers is much different than to end-consumers.

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Owning the website domain

I think most people are aware that grabbing the website domain that matches your brandname as closely as possible is preferred. Whenever I purchase a domain I always try to get the .com and the .co.uk . For Hawkker I also bought the mis-spellings such as hawwker.com and hawkkr.com in case of fat finger typing, or in case the business became wildly successful and copycats popped up. I just forwarded all these mis-spelled domains to land at hawkker.com which is simple enough to do using DNS settings. I did also try to purchase a shorter “vanity url” hawk.kr from an existing South Korean owner but was never able to establish contact. Lots of companies use these short urls for marketing or sharing links, examples include: fb.me (Facebook), pep.si (Pepsi) or nyti.ms (New York Times).

Since Hawkker as a name is pretty obscure each of my domains cost something like $15 per year so buying them was not a major financial commitment. More well-known names/terms can be wildly expensive. I think some founders feel the need to pay a lot for an catchy domain because they think this will make driving traffic to it easier. This might be the case when buying an existing domain which has previously built some SEO authority, but if it’s a brand new fresh name domain it won’t. Unless you are flush with cash I would advise against paying a lot for a domain, the hard work is really done in the online and offline marketing of your business where the money is better spent. I initially bought the domains using GoDaddy but later transferred them to Amazon Web Services and now buy all of my domains through AWS.

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Owning the social accounts

I am by no means a social media expert so take all my advice with a pinch of salt. My approach was to get the social handles that were as close to the Hawkker brandname as possible. I really wanted to have the same handle for all my social media accounts and I was able to get @hawkker for Facebook, Twitter, Instagram and LinkedIn. Initially I was unable to get @hawkker for Twitter as it was taken by an inactive user, after some back and forth with Twitter I was able to acquire the handle. TikTok unfortunately doesn’t seem to allow this so @hawkker.com is the handle there, which irritates me to this day.

Much like with your web domain, the hard part is actually driving traffic to your social accounts by delivering an effective social media strategy. Social Media Marketing is a enormous topic unto itself and beyond the scope of this article, also there are people with far more expertise than me producing advice in this area so go have a Google or whatever the verb is when asking ChatGPT.

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Owing the Trademark Space

Trademarks, copyrights and patents are all elements of intellectual property that you can protect your brand and products with. I previously worked in a medical device startup where patent protection and design rights so important that we ultimately built a substantial IP portfolio. As a tech business Hawkker doesn’t really produce anything that needed patent protection or design rights, so I mainly just wanted to trademark the company name and the logo.

You can see Hawkker’s two trademark filings at the UK Intellectual Property Office. One is a figurative trademark which covers our logo (”hawkkie” to his friends) and the other is what’s known as a word mark which covers the use of the “Hawkker” brandname. The classes that these trademarks apply to are 9, 25, 35, 39, 42 and 43. Without going into too much detail, you need to scope your trademark or logo to certain commercial spheres, these are known in the IP world as classes. The UK IPO has some guidance on trademark classes.

As a quick understanding of classes think about the name “Polo” in commercial settings. In some spheres it refers to a model of car produced by Volkswagen, in another it refers to clothing made by Ralph Lauren and (for those Brits amongst you) it could refer to Nestlé’s mint-flavoured sweet with the hole. Each of these companies VW, Ralph Lauren and Nestlé will have a trademark on the “Polo” name but in different classes. VW will own the “Polo” trademark in class 12 (Vehicles), Ralph Lauren in class 25 (clothing) and Nestlé in class 30 (Confectionary). This works because VW don’t sell cashmere jumpers and Ralph Lauren don’t make cars, thankfully.

So when you file a trademark why wouldn’t you just go for all classes to lock-out the competition across the board? Well companies don’t for a number of reasons. One is cost, it would cost a lot in trademark fees, renewal fees and legal costs to apply for all classes. Secondly you actually need to demonstrate the you are using the trademark within a Class or else it is open to revocation by the intellectual property office or opposition by other companies who want the trademark in the class. Also if you plan on defending your trademark against infringement you will have to pay to monitor a lot more classes and potentially have to enter a lot more legal fights.

You need to be strategic and think about what goods or services you intend to sell in the future. Let’s say you want to sell clothing today (class 25), but might also sell branded umbrellas within 5 years, you could also apply for class 18 today which covers umbrellas.

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Setting up your business as a company

For a variety of reasons, discussed below, most startups will eventually need to be a registered company. Registering a company in the UK is actually a pretty simple and inexpensive (£50) process with Companies House (not a real house it’s a government website). Before you tab away from this article and rush into establishing your company right this second you should check whether you actually need to or not based on decisions you might take in the future. I am not a lawyer and am not handing out legal advice here, but some key considerations you should think about when setting up what’s known as a “limited company” are:

• Do you want the limited liability protection of separating your personal assets from the company debts?
• Do you intend to seek external investment by selling shares? Or are you intending on issuing equity in the company to employees?
• Are you intending on growing a company to a significant size?
• Do you want flexibility on your financing and corporate tax planning?
• Are you looking for grants or R&D Tax Credits?
• Do your suppliers or clients require that they do business with limited companies?
• Are you prepared to submit the ongoing filings required by Companies House such as Annual Accounts and Confirmation Statements (more on this below)

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What’s involved in registering your company

Registering a company with Companies House is a process that begins with selecting your company structure—typically a private company limited by shares for most small businesses. You'll need to choose a unique company name which complies with naming regulations - CH will help you here.

Unlike with social media or web domains, I wouldn’t obsess too much about getting your registered name on Companies House to be very similar to the name you present on your marketing materials, your company name will only really appear on legal documents, tax filings, invoices and in stuff like your website Terms & Conditions.

Companies House will walk you through preparing several documents: a Memorandum of Association (which states your intention to form the company), Articles of Association (the rules governing your company's operations), and Form IN01, which contains details about your directors, registered office, and shareholders. The registration requires at least one director, a UK-based registered office address, at least one shareholder, information about your share capital, and a Standard Industrial Classification (SIC) code that describes your business activities.

This all sounds a bit daunting, but you can adopt lots of defaults (e.g. model Articles) in these documents when starting out. Once processed, Companies House will issue a Certificate of Incorporation with your unique company number, making your company officially recognised as a legal entity, woohoo you’re on the road to success!

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Setting up banking

After registering your company with Companies House, one of your most important next steps is establishing a dedicated business bank account. Unlike sole traders who can use personal accounts, limited companies legally require separate banking to maintain the distinction between the company's finances and those of its directors. A business bank account creates a clean separation between personal and business finances and simplifies your accounting and tax reporting. You can choose between traditional high street banks like Barclays or HSBC etc. or digital online-only “neobanks” such as Starling Tide or Revolut. Each comes with its own fee structure, online capabilities, and additional services tailored to businesses (e.g credit cards or business loans).

Once you've chosen a bank, you'll need to gather your documentation. Banks typically require the documentation you created with Companies House: Certificate of Incorporation, company number, details of all directors and significant shareholders, and proof of identity and address. Digital banks often provide streamlined online experiences, while traditional banks might be a bit slower. All banks conduct anti-money laundering (AML) and know your client (KYC) checks and verify the identities of key individuals in your company.

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Reporting requirements once you’re up and running

Possibly the most time-consuming admin activities are required only after your company is setup. In the UK the two main institutions you need to provide yearly information to are Companies House and HMRC (the UK tax authority).

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Confirmation Statement

Every year you will have to submit a confirmation statement to Companies House using their online service. This document confirms that the information Companies House holds about your company is up-to-date, including details about directors, registered office address, people with significant control, and share capital.

If any changes occur between confirmation statements you will also need to notify Companies House within 14 days (again, I’m not a lawyer). Often the biggest event that requires filing is when your shareholding changes after the company receives investment. Some investors like ventura capital funds will usually want their own class of share and other protections for their investments which require changes in your Articles of Association and share capital (this is discussed more towards the end of this article). In such events you have to notify CH of your new Articles, new shareholdings, new directors and updates to your list of persons with significant control. Don’t let this sort of thing stress you out right now, if you are in the (un)fortunate position of getting VC funding you will have lawyers and accountants involved who will guide you through all of this sort of stuff, which are collectively know a Company Secretarial filings.

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Annual Accounts

Your annual accounts provide a snapshot of your company's financial performance and position, including a balance sheet, profit and loss account, and maybe some accompanying notes. The deadline for submission depends on your company's accounting reference date, but typically falls 9 months after your financial year ends.

For a small, relatively uncomplicated startup your accounting requirements really fall into two main processes:

1. Ongoing book-keeping
2. VAT return creation
3. Yearly annual accounts preparation

You can hire a professional accountant who will perform all of these activities, but I personally prefer to handle book-keeping myself. Firstly to ensure that I have good visibility on the financial state of the business at all times and secondly because it is fairly easy but time-consuming and I don’t want to pay expensive accountants for such drudgery. I also love it when my transaction statement in Xero reconcile with those imported from my bank account and it gives me a little high-five (you will love it too!). As your company grows you can find somebody to handle bookkeeping, the more pedantic they are the better for your accounting records.

Book-keeping is essentially just tracking the financial transactions of the company, recording every penny that goes in and out of the business. To do this I use an accounting application called Xero (already mentioned) and for book-keeping I use Dext. All of Hawkker’s suppliers generate digital invoices which I forward (via email) into Dext. Dext then does some processing and allows me to categorise various expenditures and incomes into buckets which are defined in Xero (Xero and Dext are linked). Xero is then able to match the information coming from Dext with information coming from my business banking account and tallies each bank transaction line with an invoice. Every month I will manually review and confirm/amend all these tallies and Xero will record them in an accountant-friendly format. At the year-end I will hire a professional accountant and invite them into my Xero, they will review all the information there, perform any reconciliations/clarifications and generate my year-end accounting reports for my review and sign-off and submission to CH and HMRC.

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VAT

You might have heard of being “VAT registered” at some point in your work-life. As a business you must register with HMRC when your annual revenue (money you make selling goods/services) hits £90,000 per year. You can register before this threshold if your customers require it, or if you make a lot of business purchases that have VAT you would like to reclaim. As a business you are allowed to reclaim any VAT which you pay your suppliers since VAT is a tax only made for the final consumer not businesses involved in the various stages of production of goods and services.

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Setting up your accounting processes

My advice here would be to speak to an accountant to help you setup your accounting systems, determine which type of VAT registration you need and show you the ropes on what day-to-day activities you need to perform in terms of book-keeping and best practices for good accounting hygiene. This is what I did initially just so I could get to grips with the various software packages, book-keeping process and reporting requirements.

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Legal stuff you need to consider

No dry, long-form article about running a start-up would be complete without a discussion on the legal stuff you need to start caring about. As with much of the discussion above there is definitely a balance to be struck with the legal admin to create systems that are appropriate for your growth into the future, but without being overly burdensome and time-consuming right now.

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Employment/Consultancy Agreements

At some point you will need other people to help grow your business, most successful startups were not one man bands forever. When searching for more hands to lighten the load you have the choice as to whether you want to hire employees or contract consultants. When choosing between employees and consultants you’ve got a few things to think about. With employees, the employing company is responsible for PAYE (Pay As You Earn) tax deductions, employer's National Insurance, pension contributions, and providing statutory benefits like sick pay and holiday entitlement. You must also ensure workplace safety and carry employers' liability insurance. Hiring employees will require further configuration of your accounting systems to allow you to pay out salaries and tax contributions. Consultants on the other hand handle their own taxes and benefits. You don't pay their National Insurance or provide statutory rights, but you have got to think about stuff like IR35 tax rules. While consultants offer flexibility and reduced admin, employees may provide more stability, continuity and engagement as your grow your business.

With either of these routes you will need to create legal documents, either employment contracts or consultancy agreements. Employment contracts must provide information on the employer and employee along with the job title, start date, and work location. Financial terms must be explicit, detailing salary amount, payment frequency, and method. Working parameters need specification: hours expected, holiday entitlement, and procedures for illness. The contract should contain information on how the parties can end employment, including notice periods. Pension arrangements must be addressed, as well as disciplinary processes. Other important stuff, which isn’t legally required, like probationary periods and confidentiality clauses are also important. All terms must be provided in writing within two months of employment commencing. It is definitely useful to take some legal advice here from an employment lawyer.

Consultancy agreements are more flexible and tend to take the form of a contract for services. Stuff like PAYE and NI are the responsibility of the contractor and employment rights, termination are determined by the contract rather than legally mandated.

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Confidentiality Agreements

Whether you’re working with employees or consultants you might need to share commercially sensitive information to allow them to do their jobs. It is always sensible to put in place some confidentiality agreements to make it clear what information is sensitive and what they are allowed to share now and into the future when they may no longer be working with the company. These legal documents are often called non-disclosure agreements (NDAs).

A typical NDA includes several areas to protect confidential information. It identifies who is covered by the NDA and defines what constitutes confidential information. The agreement outlines specific permitted uses of the confidential information and establishes the duration of confidentiality obligations. They specify the consequences of breaching the agreement, often including injunctive relief and potential damages. Many NDAs also address the return or destruction of confidential materials when the relationship ends.

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Creating Equity Incentive Plans

Start-ups will often provide equity (ownership of the company) as part of a pay package, partly to align the incentives of the employee/contractor with the success of the company and often because they don’t have the cash to pay market-rate salaries in the early days. Lots of people who join early-stage start-ups which are successful will ultimately make most of their remuneration through their equity ownership not their salaries.

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Things to consider when issuing equity incentives

Equity incentivisation is a huge topic and would warrant a whole article unto itself, that said below is a brief discussion of some broad areas for start-ups to consider when creating incentive packages.

How much of the company do you include in the equity package for the employee? Earlier or more critical employees might warrant higher amounts of equity to reflect how risky the company is in the early-days, how much salary they are giving up or to reflect how important their role is in the success of the company.

Another question is how quickly does the employee “earn” the equity you issue them? Companies use equity plans as both an incentive and a retention mechanism. A company wouldn’t pay an employee their entire annual salary on day 1, it is paid in monthly instalments over the year. In the same vein you shouldn’t give an employee their entire equity allotment on day 1, they should “earn” it over a certain time period. This concept of “earning” equity is known as vesting and there are lots of things to consider here. How long should the vesting period be? For example, if a company issued an employee 1000 shares over 3 years then they would vest ~27 shares (1000/36) each month. Some companies also include vesting cliff which means if you leave before the first year (for example) then you don’t earn any equity and your shares are clawed back (a pretty dramatic term) by the company. In addition to time-based vesting, it can also be tied to specific performance metrics which you want the employee or the company to reach.

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Option incentive plans

For various tax reasons, startups will often issue equity in the forms of share options. These are instruments which give the optionholder (the incentivised employee) the ability to purchase shares (equity) in the business. In addition to the vesting considerations already mentioned when issuing options the company will need to determine the exercise price, i.e. how much the employee needs to pay to convert an option into a share. It will also need to specify which class of share (if multiple classes) the optionholder will receive when exercising the option. Contracts need to include stuff like what happens if the employee leaves with unexercised shares, what happens if the company is sold or acquired and many other things. There are lawyers who deal specifically with this sort of thing, so speak to them before setting up an incentive packages.

In the UK there are various schemes which provide tax advantages for both the company and the employee for issuing options as part of a pay package. One such scheme is known as the Enterprise Management Incentive (EMI) scheme which is a government-approved, tax-advantaged share option plans designed specifically for small and medium-sized businesses. Without going into a lot of detail it essentially allows employees who get paid in EMI-approved options to benefit from capital gains tax relief rather than higher income tax rates.

There is a significant amount of work involved in setting up EMI schemes since they’re government approved, and you will likely need to work with a lawyer and an accountant to ensure that the option contracts you create are inline with the regulations and your company is eligible to issue them.

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Fundraising for your startup

Unless you’re fully self-funded or growing your business through early revenue growth (known in startup lingo as bootstrapping) one day you will need to ask external people for money at some point. As you might expect this is another huge topic area and is written about extensively elsewhere online. That said I think this article would incomplete without mentioning some of the broader strokes around fundraising.

If you’re taking money from friends and family then the admin involved can be quite simple. for small amounts of money you might have a simple napkin agreement or reflect the ownership more formally on Companies House and have some relatively simple share purchase agreement. However once you start taking money from more serious investors (like VCs and Angel Investors) they will want robust arrangements to protect their investment and usually seek legal mechanisms to give them some control over the destiny of the company.

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Preparing for formal investment

Much of the discussion around fundraising will focus on the commercials: how much of the company are you going to sell and for how much money. For example imagine a company and investor have agreed that the business has a pre-money valuation of £8m. The VC puts in a £2m resulting in VC ownership of 20% (£2m/£10m) as the ownership amount is based on the post-money valuation (£8m pre-money + £2m investment funds).

Professional investors often want share special classes which give them privileges that the previous shareholders (founders, family, employees) might not have. For example a VC might want increased voting rights for matters that require shareholder votes (e.g. 1 share = 2 votes), or a liquidation preference, which gives them priority on proceeds of any sales of the company. They might also want anti-dilution rights which protects their ownership if the company raises more money at lower valuations in the future.

VCs can really ask for whatever they want and it will be down to commercial negotiations as to what they are given. Once the commercials are agreed there are lots of admin items which need dealing with, such as Share Purchase Agreements, updated Articles of Association, Board of Directors creation and financial reporting and governance systems.

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Why you need a Capitalisation Table

A capitalisation table (or cap table) is a spreadsheet that outlines a startup’s ownership and voting structure in detail. It serves as a single source of truth as to who owns the company alongside the number and class of shares they hold—whether ordinary, preferred, or options.

The cap table includes key details such as each shareholder’s percentage of ownership, the valuation of shares at each investment round. Beyond showing ownership, it provides transparency, helps stakeholders understand voting power and control, and assists the company in financial modelling, fundraising strategy, and planning for dilution in future investment rounds.

You can build a cap table in excel or one of the many online services which makes cap table management easier. Either way make sure to maintain this document very carefully and accurately. To avoid angry shareholders you want zero confusion when discussing how much of a company the various shareholders own (on a fully-diluted basis), what their voting rights are and how much they stand to make at various valuations of the company.

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Beware: life can get harder following investment

Formal investors will usually request a seat on the management board of the company and want regular board meetings where the company executives provide reports on the progress of the business. VC will often request special rights for their board member(s) which gives them an outsized vote when approving major decision for the company. For example they might have a golden vote (veto power) when approving a sale of the company or choosing a new CEO.

Shareholder management often falls to the CEO or founder and can demand a lot of attention away from the core business. The executive team might find itself spending a lot of time justifying decisions to board members and shareholders and being forced to adapt the business strategy to keep important stakeholders happy.

Venture capital firms tend to run on investment cycles. They raise money from various sources to then invest into startups as they grow their investment portfolio. They then help their portfolio startups scale and grow and after a few (5 to 7ish) years they want to get their money out and return profits to their own backers. As such then are often guilty of applying pressure on their portfolio companies to deliver returns within this window, even if this isn’t the best thing for the company. As mentioned they put in place controls such that they can force through liquidity events (selling the portfolio company) even if other shareholders don’t necessarily want to.

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Conclusion

Running a startup involves much more than just developing innovative products or services. The administrative and legal responsibilities can be overwhelming, from managing day-to-day operations to handling complex equity arrangements and investor relations. While these tasks may seem disconnected from your core mission, they are crucial for building a sustainable and successful business.

Founders must be prepared to wear multiple hats and deal with various stakeholders, from employees and contractors to investors and board members. The transition from having complete control to being accountable to shareholders can be particularly challenging. However, understanding and effectively managing these administrative aspects can create a strong foundation for growth.

Success in the startup world requires not only a great business idea but also the ability to navigate legal requirements, maintain accurate documentation, and balance various stakeholder interests. While these responsibilities may seem daunting at first, with proper planning, professional support, and systematic approaches, they become manageable parts of building a thriving business.