New Zealand is a country full of inspirational entrepreneurs and small businesses are the backbone of New Zealand’s economy.
The reality of this fact has been felt and understood more than ever as a result of the COVID-19 pandemic.
Taking a positive from a negative, there are plenty of new opportunities within New Zealand to explore entrepreneurship and create innovative new businesses.
Now is the time where you could potentially realise the dream of starting your own business.
Newshub spoke to three experts - MYOB’s Country Manager Ingrid Cronin-Knight, and two MYOB Partners and accountants - Scott Mason, Managing Partner at Findex Dunedin, and Emma Murphy, Associate Tax & Business Advisor at Kiwitax.
Each of them have many years under their belts working with a range of Kiwi startups and together they share some top tips on the best ways to kick start your own startup.
1. First steps
According to Ingrid Cronin-Knight, new entrepreneurs should be encouraged by the strength of New Zealand’s startup ecosystem, within which business advisors - including accountants - play a key role.
"Accountants tend to specialise in certain areas, so finding one that has experience with startups is important – it’s even better if they personally have a passion for the business industry too as they can provide even more insight for you to consider. Don’t feel afraid to shop around to get the right fit," she says.
"Startup founders shouldn’t think of themselves as too small, or too early in their business journey to seek advice. Accountants work with businesses of all sizes and they tend to form long-term relationships with clients, a lot of which begins when the business is in the startup phase," she says.
"Having an Accountant or bookkeeper on your team, is no longer just about checking in tax time," Ingrid says. "Technology today provides real time visibility of how businesses and markets are performing, and these advisors can help you use that information to make real time decisions. They can help sense check trendsetting and forecasting, plus provide crucial advice before a business even starts trading."
2. Trust is essential
"Trust is key to any sustainable relationship and if the chemistry is right, these advisor roles offer so much more," Ingrid says. "The industry has evolved and accountants play a much more pro-active advisory role, so it’s important to make sure you pick one you are comfortable with. This is particularly important when you’re thinking about the potential for uncomfortable conversations about money."
"Most accountants provide a free consultation to meet clients; gauge what they need and make sure the chemistry is right. Plus, pricing is no longer 'set' so you should try to negotiate fees up front to avoid unpleasant surprises and to help you budget."
Scott Mason of Findex Dunedin, admits that when it comes to the hard questions, you need honest answers . "Bear in mind these questions can be hard to ask yourself, so advisors are probably the best people to be having honest conversations with and answering some difficult questions," he explains.
3. Prepare and plan
A lot of work goes on before a business even gets off the ground. Scott explains that generally people who are behind startups, are really good at something and have an incredible vision.
"A lot of them may be good at understanding or delivering key components, but not everyone considers the commercial aspects, and they might not have commercial acumen or experience yet," he says.
"By seeking sound professional advice early on, they’ll be better placed for success. Starting a business can be a challenge for an entrepreneur. As advisors, many of us have been in business long enough to know what needs to be done and the pitfalls to avoid. This means we can advise startups on how to make sound business decisions from the get-go," Scott says.
"Bringing a good idea to life can be incredibly exciting in the beginning. For many budding entrepreneurs, adding commercial rigour to a concept during the business planning stage may feel tedious, especially when you go it alone," adds Ingrid.
"Objective and critical thinking at this point from an advisor, can highlight gaps, opportunities or show-stoppers that founders may not have considered. Working through this process together also helps to ensure that the business has a robust strategy and provides the founders with a fuller picture which can prove helpful if they find they need to change tack."
"Once this groundwork is done, it'll make it so much easier to prepare investment proposals, funding requests, marketing plans etc. You’re already winning if you have this kind of support before you’re even trading."
4. Hygiene matters
"This refers to something that’s not sexy or fun but has to be done," says Scott. "We can’t do everything for a business, but we like to teach them, and encourage them to take control of their own destiny. As an advisor we provide guidance which helps the client to make informed decisions, but we also encourage them to take responsibility for these decisions," he says.
Scott points out it’s important for startups to talk to an accountant when they are starting to operate so they are up-to-date with compliance, to enable their business to accept money and account for funds.
"At the early stage every dollar is seen as precious,” he says. “But you don’t want to start by cutting corners early. Proactive management here also shows potential investors you can deliver on your plans. So, one of the first things is to do is your due diligence."
According to Emma Murphy of Kiwitax, startups should seek advice early on so they can access expert guidance and advice around their business structure, and prepare for tax planning and registrations that may be required by the IRD e.g GST.
"It’s important for startup founders to gain knowledge about what types of costs are deductible (or not). Your accountant or bookkeeper can also provide advice around the online software solutions available to capture important business data," she says.
COVID-19 - what to do next?
All the experts agree entrepreneurs shouldn’t be deterred, because now could be a great time to ‘start up’ a new and innovative business.
MYOB has a network of 40,000 accountants and bookkeepers across Australia and New Zealand who can share good advice and encouragement for startups that may be struggling to deal with the uncertainty brought about by COVID-19.
"Kiwis should embrace their enterprising and adventurous natures, and now is actually a really good time to take the plunge and start a new business. With the right advice and tools to support startup founders on their journey, there’s every chance for their success," Ingrid Cronin-Knight says.
Right now, MYOB is offering an MYOB Essentials subscription for only $5 a month for Kiwi startups that are 0-2 years old. Find out more here.
This article was created for MYOB NZ