The Business Development Bank of Canada
Western Diversification
The BC Women's Enterprise Society
Google results for 'small business' mentorship Canada sites

FYI my mother used to be involved in small business loans counselling, and the stats say most small businesses fail because of a poor business plan. Now there are lots of people who will say they succeeded with their small business and they never *had* a business plan, but compared to the number of startups, these success stories make up only a tiny percentage.

The fact is most neophyte entrepreneurs mistake being 'busy' for being 'profitable', and - maybe because of poor, misapplied or non-existent accounting skills - don't find out until their first year-end that they have been operating at a loss. Or they have cash-flow problems, where they have the business but not the bridge financing to get them through the manufacturing phase.

The book my mother recommended to all her clients was: The E-Myth Revisited: Why Most Small Businesses Don't Work and What to Do About It. The 'e' is for Entrepreneur.

Edited to add:

A few notes: First, you don't have to be looking for financing to use the financial institutions listed. When I worked for the FBDB they did oodles of counselling and mentorship even for people who weren't clients. The same is true I believe for the other funders.

You'll notice that the BCWES and WD are both for Western Canada; if you're not there, I'm sure similar programs exist for other parts of Canada; perhaps contacting them would yield more information. And a clarification, WD is BC to MB.

Another key point in the e-myth book is an observation that many people go into business to do something they love, where they would probably be happier and better-compensated to do the work they love for someone else. The point the book makes is that there is a difference between 'self-employed' and 'small business-owner', but lots of people who start their own business are really just under-employed contractors who took the advice of loved-ones who told them 'gee, you're good at that; you should start your own business!'.

Not to sound negative, but it is an important point I think.

[ 09 April 2005: Message edited by: Anchoress ]

quote:

---

lots of people who start their own business are really just under-employed contractors

---

I am painfully aware that there are professional companies and NPOs that provide some of these services. So, for the lack of a specialized degree, I am wracking my brain trying to spin my skills into some sort of niche that I can specialize in.

quote:

---

Originally posted by steffie:
Cool, thanks!

P.S. When I grow up I want to be Audra Williams.

---

There are lots and lots of angles to consider:

1. Most successful independent contractors (there are a few on this board, maybe they will weigh in) had paid experience in their field before they struck out on their own. Many were able to keep existing clients when they went private. Have you done work in this field? If not, you may have a few lean years before you start making an income.

2. While you enjoy a lot of freedom from self-employment, you also have to recognise the downside; no CPP or EI contributions, more responsibility for your taxes, no extended health benefits, no extra retirement benefits. You will have to be ruthlessly self-examining to determine whether or not you are the kind of person who could discipline yourself to budget and save the way you will need to in order to protect your future.

Starting up is not that hard. Essentially you'll need a GST number; for the 'math' stuff you may want to get an accountant (if you have one in your extended family / friends you may get some free advice there!). However, even with an accountant, you'll need to keep track of your income and expenses yourself. This is fairly simple and only takes a couple of hours a month.

Like Anchoress said above, it helps a lot to have some customers lined up before your start. In my case I did consulting as a side-line for about one year, while keeping my full-time employment, before going solo for good.

Another point mentioned above is health benefits. I was lucky myself to be able to share the benefit plan of my better half; if you're not in that position, you may want to consider buying a plan. There may be group plans out there for your profession (I did use the one provided by APCC-Ontario during those years my wife stayed home).

If the business is your main or only income, make sure you buy disability insurance. The problem with WCB is that it only covers you if you injure yourself at work. If you fall off a ladder while painting your ceiling, you're out of luck! One of my friend's dad suffered such an accident and could not work for 2 years. He lost nearly everything as he had no income replacement. Don't let that happen to you.

Finally, going in business is a lot more work than being employed. Make sure it is substantially improving your financial situation before taking the plunge. A rule of thumb is that if you can confidently double your income by going independent, and keep busy, go for it.

quote:

---

In my case I did consulting as a side-line for about one year, while keeping my full-time employment, before going solo for good.

---

Bernard, this is what I see myself doing, indefinitely. And, since you have your PM feature turned off, I'll ask you here about claiming that "extra" income. How much do I have to make on the side to warrant claiming it on my tax return? What's that you say? Nobody has to be the wiser? Do go on...

- one room in my house which I turned into an office/lab
- travel to/from clients (you can pay yourself 0.31$ per km)
- write off computer(s), materials, books, etc.

Again you have to be careful with those 'write offs'; sure, the money you spend is before-tax, but you still spend it anyway. Many of my fellow consultants got fried buying lavish meals, trips and luxury cars and saying 'no problem, I'll write it off'.

Now if you get paid cash, you can probably keep quiet about it. Many tradespeople in this country operate like that...

[ 14 April 2005: Message edited by: Bernard W ]

I've gone the route of digging up short-term contracts where you have to estimate how long a job will take, which is difficult to do [hint: it almost always takes longer]. This is an insecure life and it helps if you have a cushion to live on between contracts. If you do not need money too urgently, you can relax and avoid rush hours and such stresses. And there are the business-use-of-home tax deductions.

There are plenty of legitimate write offs available to you as a self employed person, so if you ask me it would be foolish to try to cheat the system and risk being caught in an audit.

I would also advise against getting caught up in the whole business name racket. If you get a GST number and simply operate under your own name, you can avoid having to
register your business provincially. You'll also be able to just deposit your cheques through your existing personal account, rather than being forced to open a separate small business account and pay additional banking fees.

Of course some accountants may try to tell you otherwise, but they're probably just trying to find a way to increase their billable hours. There's no need to make things more complicated. With a basic software package like Quick Tax, even those business owners who are not mathematically inclined should have no trouble managing their own taxes.

quote:

---

Contrarian is correct. You must register for the GST and obtain a business number from the Canada Revenue Agency if you earn more than $30,000 in a single calendar quarter or in four consecutive calendar quarters. See this link for more detail.

---

I know lots of people who don't bother with a GST number, who make more than $30,000, but only claim $30,000 or less officially.

That figure of $30,000 was part of the original legislation back when it was first introduced, I would think. That's a problem, $30,000 15 years ago is not $30,000 today. That number should automatically be adjusted for inflation, cost of living increases, and it clearly has not been. That's poor management on the part of the federal government.

Better yet the GST should be 'killed scrapped and abolished'. That would be a really good idea. I think somebody already thought of that idea a while back. 'The proof is the proof is the proof and when it is proven it is proven.'

By the way, take a look at 'Simply Accounting' software. Made in Canada for Canadians. Allows one to test drive it. I think one can do 32 transactions with the software to get a feel for it, see how it works, see if it fits one's needs, but on the 33 transaction, it shuts down, that's the free sample, by then one should know if one likes it. It's seems like it is very user friendly, and seems like it has gotten to be more so over time. Always making improvements and such. I think there are a few versions, one sure to allow you to do what you need to do. Check it out.

[ 15 April 2005: Message edited by: Leuca ]

[ 15 April 2005: Message edited by: Contrarian ]

quote:

---

You'll also be able to just deposit your cheques through your existing personal account, rather than being forced to open a separate small business account and pay additional banking fees.

---

I agree. However, I suggest you use a different personal account for the business. Use a good old-fashioned deposit book for depositing revenue (plus take a copy of the client's cheque) and get all the cheques back with a monthly statement. Attach receipts to cheques. If you pay for something out of cash, write yourself a cheque and attach the receipts to it when it comes back with a statement.

She believes that she can bring me aboard under her business, to sell us "as a team." (Her son's progress under my tutelage would be a great selling point!)

Even if I only teach her son and one or two other students, I can stand to make about $1000-1500 a month. Considering that I'm currently pulling in slightly less than that amount with my regular job, it looks pretty darned sweet to me.

My worries stem from feeling that I am qualified enough to call myself a tutor, an educator. Am I stepping on the toes of teachers and "professional" tutors? Or should I care?

I do a damned good job of it and truly know that this is what I was meant to do. It speaks to me in a deep and meaningful way.

I have begun by playing around with programs such as MS Front Page to create a brochure. A web site would be good too.

quote:

---

Originally posted by steffie:

My worries stem from feeling that I am qualified enough to call myself a tutor, an educator. Am I stepping on the toes of teachers and "professional" tutors? Or should I care?

I do a damned good job of it and truly know that this is what I was meant to do. It speaks to me in a deep and meaningful way.

I

---

The "I'm a Cheat" feeling. It's hard to start charging the going rate for something that in the past you were only paid a wage for, isn't it? I had to keep reminding myself when I started that my boss had billed my services out for jillions more than he paid me to provide them, and that yes, dammit, I was worth the money.

The best part of not working for someone else is the flexibility when it comes to scheduling your own life. And do be ever so careful with tracking your expenses and recording your revenues, audits are somehow both nerve wracking and dreadfully boring all at once.