How to start a small business in NYC with less investment?
New York is considered as one of the top locations for young entrepreneurs to start a small business because the state has a favorable business environment. One of the main reasons is that the state is a major financial hub and a center for global businesses in diverse industries. This article has been created to provide you with an insight into why New York is an ideal place to start a small business, how to start a business in NYC with no money, and the steps involved towards forming your business in the state.
Starting a Small Business in NYC
New York is home to 2.3 million small businesses and this includes every form of business right from home-based businesses to e-commerce, mom-and-pop corner stores, IT startups, and financial firms. Small businesses account for a greater slice of the market with its existence in almost every industry sector in the state. You can start a small business in NYC in some of the top industries like trade, financial activities, manufacturing, professional services, leisure activities, and information technology among others.
Since New York is the financial center of the nation, there are several business opportunities. If you have been wondering how to start a business in NYC with no money then you will be surprised to know that some of the top startups and home-based businesses started without any capital expenses. One of the factors that help businesses to start without any capital is the availability and access to grants, seed funds, and venture capital.
Is New York an ideal place to start a small business?
If you are planning to start a small business in NYC then it will be a favorable decision for your company. This is more so as the state promises opportunities, a good startup environment, innovation hubs, and logistics infrastructure among others. The gross domestic product (GDP) of New York is $1.7 trillion, which makes it the third-largest economy in the nation and right behind Texas and California. If you want to set up a company in the state and are wondering how to start a business in NYC with no money then it is important to identify the advantages and benefits it offers. These include:
- Talent pool – The success of every small business in New York can be attributed to its employees. When you start a small business in NYC, one of the major benefits is that you will have access to a skilled talent pool. You will be able to hire professionals with strong skill sets, experienced and committed individuals, and even be able to recruit cream talent right out of college.
- Diverse industries – New York is home to diverse industries that provide the platform and opportunities for small business ideas in New York to grow into a highly profitable business. The top industry is the financial services sector, which is synonymous with the New York Stock Exchange (NYSE). This sector has generated $429 billion and is followed closely by healthcare services. Some of the other sectors where you can start a small business in NYC include professional and business services with a contribution of $195 billion to the GDP of New York, retail trade ($64.5 billion), and manufacturing.
- Financial Assistance – If you are wondering how to start a business in NYC with no money then the state offers several opportunities, tools, and programs targeted at providing financial assistance. Different types of businesses have different startup costs and the state provides several options to choose from. You can opt for government grant programs like the Small Business Innovation Research (SBIR) and Small Business Technology Transfer (STTR). The state also attracts venture capitalists with fintech startups raising $39.2 billion.
Low cost & profitable small business ideas in NYC
New York is one of the favored destinations for entrepreneurs as well as venture capitalists. The state is undergoing an era of heightened venture capital activity and startups with small business ideas in New York have become an integral part of the startup ecosystem. If you plan to start a small business in NYC then one of the important aspects to consider is the industry as some sectors attract more investors, incubators, and accelerators as compared to other sectors. Let’s take a look at some of the trending small business ideas in NYC.
- Webpreneur – One of the ideas that belong in starting a business in NYC in checklist form is ‘Webpreneurship’ also known as Digital Entrepreneurship. This is considered a low cost startup idea as you will be conducting most of your business online. You can become a webpreneur and work from your home or even from co-working spaces. As a webpreneur, some of the areas to focus on include web design & development, internet marketing, content creation, programming, and software development among others.
- Homemade meal delivery – Homemade meal delivery is considered a profitable business in New York as these services focus on a customer oriented menu that can be delivered right to the doorstep. Today, there are over 260 Food Tech startups in the state that focus on providing healthy food with choices ranging from vegan to plant-based seafood substitutes.
- Handmade Products – One of the areas that should be in your starting a business in NYC checklist is handmade crafts. Entrepreneurs and home-based businesses are actually converting their hobbies into a profitable business in New York. If you want to explore your artistic side then some of the handmade crafts that you can indulge in include jewelry designing, making ceramics, scented candle making, soap making, handbag designer, woodworking, furniture upcycling, floral artists, mural artist, custom calligraphy services, and t-shirt designing among others.
- Internet based businesses – One of the sectors that has been making waves in New York and globally is the computer or IT related businesses. This is one idea that should be on your starting a business in NYC checklist as there are several areas that you can focus on depending on your resources and budget. If you have been thinking about how to start a business in NYC with no money then food blogging, travel blogging, and vlogging are areas that you can explore. Some of the other areas and services that are trending include computer tutor, desktop publishing, computer repair, IT consulting, app development, and even launching an e-commerce store.
Steps to Start a Small Business in NYC
If you are wondering how to start a small business in NYC then it is important to first identify the business idea and the market you want to launch in. There are several processes that will be involved towards turning your idea into a profitable business in New York. These processes vary from the creating a business plan to securing funding and registration of the business. Let us look at the key areas that you will need to focus on in order to achieve success.
1. Prepare a small business plan
A well written business plan can turn your idea or innovation into a profitable business in New York. Essentially, a business plan is a strategic tool that an entrepreneur or small business owner can use to identify the various requirements of the startup right from the conception phase to the operational stage. A good strategic plan will help you in identifying targeted markets, competition, startup costs, and long-term objectives. If you plan to start a small business in NYC then some of the key areas of the plan are:
- An executive summary of your small business
- An objective statement defining business goals
- The legal structure of your business
- Startup Expenses
- Research of the market to launch in
- Existing and expected competition
- Identification of targeted customer
- Products and services you are planning to offer
- Marketing and sales strategy
- Financial projections
It is important to ensure that your business plan is concise and contains all relevant information pertaining to making the startup operational and for securing funding.
2. Register your business
One of the important aspects of starting a business in NYC in checklist form is registration of your business. The new business formation process, documentation, and filing fee vary according to the legal structure of the entity as chosen by you. It is also important to note that the process and documentation for registering a domestic entity is different from that of a foreign entity. Let’s look at an example to make it simpler.
Example: If your small business ideas in New York revolve around forming a single owner startup then you can opt to form a sole proprietorship or a single member LLC. A sole proprietorship business is not required to register with the state but if you form a Limited liability Company (LLC) then you will be required to file the Articles of Organization with the Department of State pursuant to Section 203 of the New York State Limited Liability Company Law. The filing fee for an LLC will be $200.
Similarly, if you want to start a small business in NYC as a C Corporation then the documentation and fee would be different. At IncParadise, we can help you to register your company in the state, so that you don’t have to worry about the complex processes and documentation.
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3. Secure funding for business
If you want to know how to start a business in NYC with no money then the first step towards it is to identify ways to secure funding. It is no secret that even a startup from home will require capital for making the business operational. You have to first determine how much funding your business will require. A business plan will help you to create the budget for the same. So how do you arrange for startup finances? One of the best options is to identify the various small business grants and related funding opportunities in NY.
A business grant is a type of funding where business owners or entrepreneurs are not required to return or pay back the grant amount. Grants are normally administered by the state government agencies, foundations, trusts, and even corporations. You can qualify for a grant program after you register or start a small business in NYC. Some of the popular grant programs in New York are Pandemic Small Business Recovery Grant Program, Tourism Return-to-Work Grant Program, Meet in New York Grant Program, and Global NY State Trade Expansion Program (STEP) among others.
4. Check for business license, permits and zoning requirements
If you are planning to start a small business in NYC then there are several state requirements that the entity has to fulfill to maintain a good standing. One of the key requirements is getting a business license or permit. The license or sales permit will help a new business to conduct its operations in the state. IT is required by both domestic and foreign entities. The type of license required will often be dependent on the industry or business activity. If you want to start a company with your small business ideas in New York then you can choose from three different types of licenses, which are:
- Industry based licenses like a manufacturing industry or tourism sector
- Occupational licenses for professional skills like a certified public accountant
- Local licenses, which are issued by the city or county your business is based in like in Manhattan or Brooklyn.
You may also need a seller’s permit, which is also known as the certificate of authority. Apart from the permit, you need to ensure your business is in compliance with all zoning laws and has the necessary building and zoning permits to start a small business in NYC.
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5. Open your small business
Once you have registered your business and obtained necessary licenses and permits, the next step is to start conducting business. One of the important things to remember is that in order to start a small business in NYC, you need to have your marketing strategy in place. The more customers you reach with minimal marketing expenses, the higher the probability of making a profitable business in New York will be.
Depending on the type of business, you can even create a website and market on social media to create higher awareness. You need to also apply for and obtain an EIN (Employer Identification Number) as this helps in opening a business bank account and also for filing tax returns. Once you start conducting business, you will need to ensure, you maintain annual compliances like renewal of business licenses or permits and filing of annual reports.
Need Any Help in Forming Your NYC Small Business?
In order to start a small business in NYC, you will need to determine the right business structure. A business structure plays an integral role when it comes to taxes, availability of secure funding, venture capital, the documentation required for new business registration process, and annual maintenance.
We at IncParadise can assist you with not only new business formation or incorporation but also help you maintain annual compliances like filing of annual reports. We are one of the leading business incorporations and registered agent service providers in NY and offer a wide range of additional services that cater to the different needs of a small business.