Insurance Policies for Startups

It can be tricky to shop for the best insurance policies for a startup. Most insurance brokers will not be able to provide you with the coverage that fits your needs. As your company raises money, hires more employees, and brings in more customers it is important to be covered. I suggest shopping at Embroker which specializes in insurance for startups.

The Basics Insurance Policies:
General Liability: provides financial protection for your business in the event of lawsuits, claims, or settlements. These may arise as the result of injuries or property damage connected with your business, or even non-physical acts like slander or libel. You need this.

Property: covers your business’ physical assets including buildings and inventory. This will cover all your business’ assets, whether they are leased or owned. This should also include personal property belonging to others that are in your company’s care.

Workers Compensation: aka workman’s comp or workers’ comp, gives your employees benefits if they get a work-related injury or illness. This is required in most states.

E&O (Errors and Omissions) insurance will protect your company and employees against claims made by clients for unsatisfactory work, mistakes, or against a deliverable that you were not able to deliver. You should have this if you bill clients for services.

D&O (Directors and Officers) protects the company’s directors and officers against claims of wrongful acts, management misconduct, theft, unfair competition, fraud, and more. This protects you against claims that come from your investors, employees, clients, vendors, or competitors. Investors will require that you have this.

Cyber Liability: covers a data breach involving sensitive customer information, such as Social Security numbers, credit card numbers, account numbers, driver’s license numbers, and health records.

The cost of each policy depends on many different factors. You can expect very basic coverage to start at a few hundred dollars a year. As you grow, you will be paying thousands a year.

Do Not Overlook Operations

Operations allow business leaders to stop thinking from day to day and start to focus on growth. If you are running a growing business, you should not overlook filling this role. When it comes to operations you will pay now or pay later in the form of inefficient workflow. You should rely on them for planning, decision making, organizing, leading and controlling. They should always be observing and improving the business and its processes.

Ops is the only department that will get their hands on every part of the business: HR, office management, accounting/finance, product development, and customer support. They should have access to almost everything: funding agreements, contracts, shareholder resolutions, etc. If done right, operations can be the key to growth within a company.

Operations can also play pitcher. You will need other people to speak on behalf of the business. A great operations team can help you pitch the business both internally and externally. They are able to provide a broad overview due to the fact that they are involved with every aspect of the business.

They can meet with each employee on the team on a consistent basis. It is invaluable to consistently ask employees what they are up to, what challenges they are facing and how they go about their work. It is also important to keep set and revisit employee goals for both themselves and the company.

How to Work Successfully Alongside a Growing Business

Why work with growing businesses?
That’s easy. The people! Working with people who are out to change the world is the best. The passion and energy my customers bring is contagious. I’m typically working with 3 to 6 different customers at one time, and work on something new almost every day. In 2013, I raised seed capital and founded a small startup. Throughout that time I had made side money creating business plans for my peers. I started to put the pieces together for Anny.Biz at the end of 2015. A few months later I had a full book of work.

Many of the challenges I deal with on a day-to-day basis are unique. Solving expansion challenges is often messy, and ambiguous. Facing new challenges keeps the job exciting. It’s fun to see businesses grow and jobs being created right in front of your eyes. You can make more money pursuing a traditional path of consulting, solving deeply complex problems.

Obstacles
Growing businesses don’t allocate a big budget for consulting or outside help. This is perhaps the biggest challenge, and why you won’t see many large consulting firms in this space. You must target businesses that have raised money or have paying customers.  Experienced founders know how valuable a good consultant can be and tend to be better clients. I charge a retainer fee to give the client incentive to prioritize the work we will be collaborating on.

Types of Services to Offer
-Projects where you are solving a unique problem. This could take anywhere from 2 weeks to 1 year.

-Low volume services. In this case, you become deeply involved with one or more clients. ie interim CFO. This might also be structured as a fixed fee with a bonus to go alongside company milestones.

Most Popular Finance and Operation Software Among Startups

Our friends at Divvy ran a survey and collected data from 200 finance managers at Seed to Series B companies asking about the tools that made up their finance stack. They collected data to determine the most commonly used apps and the apps with the highest satisfaction rating.

Accounting & Budgeting:
● Most Common: Quickbooks Online
● Highest Rating: Xero

Payment Processing:
● Most Common:Quickbooks Online
● Highest Rating: Stripe

Payroll:
● Most Common: Gusto
● Highest Rating: Gusto

Human Resources:
● Most Common: Gusto
● Highest Rating: Bamboo

HR Reporting & Intelligence
● Most Common: Excel
● Highest Rating: Grow

Overscheduling = Underperforming

The number one reason leaders give me for their lower than desired performance is that the leader is over-scheduled and doesn’t have the time necessary to address underperformance.

Many of my clients have a typical day of going from meeting to phone call all while receiving texts or Slack messages asking for answers to important questions. They have no time to think broadly and deeply about what transpired in their meetings. Greater effectiveness comes from leaders and employees who are energized, uplifted, and enthused about making a positive difference in the life of their customers and employees.

Here are some of the negative side effects of the leader being overscheduled:

Poor Communication: When a leader feels overwhelmed, their ability to think critically decreases. The advice given is screened through the prism of expediency rather than effectiveness. The research shows that as the number of hours you work each week goes further north, the quality of your work goes proportionally south.

Mission Critical Projects Take Up All Your Time: Leaders are expected to lead and manage mission-critical projects, which require increased energy, focus, and perseverance. And yet in most organizations today, when leaders have mission-critical projects, they are also expected to maintain their current day-to-day work. This expanded scope of responsibility is coupled with an already heavy workload, the level of anxiety and feeling of being overwhelmed skyrockets.

Routine Work Suffers: The existence of a leader’s routine work is one where constant priority-setting is a necessity and a reality. When all of your priorities are a top priority, you end up with no priorities. With greater priority-setting skills, a leader can increase the strategic use of their time.

Try using Trello to manage some your company’s projects.