Essay Sample on Business Venture

Introduction

The legal structure of this new business venture is the sole proprietorship. The business will offer writing consultancy services to people that need writing help. Because the business is a strut, it will employ a few numbers of people, and because of the small nature of the business, there is no need to use other legal structures apart from the sole proprietorship. The organizational structure of the business would be me at the top and the other employees below me. There would be no need to have hierarchies in the business organization structure as the employees in the business would still be few and can be managed easily with one person that they can all answer to. Having hierarchies will be redundant and overkill. The reason that I have chosen this legal structure is the ease of forming it and the low amount of taxes that businesses in this legal structure are charged.

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My colleagues chose different legal structures for their startup businesses. One of them chose to start with a sole proprietorship and then after the business started to grow, he would have it changed to a limited liability company. The problem that I have with this legal structure is that it introduces people to the business that might not share in the vision of the founding entrepreneur. This will result in internal wrangles in which every shareholder tries to prove that they are better than the other shareholders. This might result in losses and even the business going out of business. Another college of mine has chosen to convert his business to a partnership immediately; it starts making a sustainable amount of money. The challenge that I see with this legal structure is that like the limited liability company, it will introduce people that might have different visions to the company, and this might result in conflicts.

Discussion Response Two

When starting a new business, it is important to ensure simplicity and efficiency. A sole proprietorship will ensure that the processes within a business are not complex and can be easily understood. For example, in the registration process, the registration of a sole proprietorship is simples compared to other legal structures. This legal structure also costs the least as compared to the other structures. After the company grows to some point, I would change the company to be a limited liability company. Sole proprietorship, although good for small businesses, presents some challenges when the business wants to grow to new heights. An example of the challenge is that the assets of the company are also the assets of the entrepreneur. Through changing to a limited liability company, the business will also attract more people that want to share in on the direction that the company is going to invest. The increased revenue will make the business prosper even more.

Some of the people that were doing the same project as I chose a different legal structure for their businesses. The most common was the sole proprietorship when the business was starting. This is the best option for businesses that are starting. However, some entrepreneurs chose to stick with this legal structure throughout the life of the business. Although I acknowledge that some businesses can succeed with solely this legal structure, businesses that want to grow beyond the confines of this legal structure have to switch to better legal structures that will enable then do more.

Discussion Response Three

The legal structure of a business is integral as it shows how the business identifies itself. In this startup business that I started, I will choose to start with a sole proprietorship. For a startup, this legal structure offers the most amount of benefits as compared to all the other legal structures. The main advantage is the ease of formation of this structure. To form this, a small amount of money is needed in comparison to the other legal business structures. The small amount of money is beneficial as when a business is just starting; the amount of resources at its disposal is limited. Entrepreneurs aim to save as much money as they can. After the business grows, I will turn int to a limited liability company to take advantage of the opportunities that are operating as a company has when the business has already grown. These advantages include tax breaks and more resources available for the business.

The organizational structure that the business will employ will depend on the stage of growth that the business will be in. When the business is still at its infancy stages, the organizational structure that will be employed is all employees in one level where they all report to me. This will give me a bird's eye view on what is going on in the business. After the business becomes a company, the resources that it will have will be enough to employ more employees. The increased human resources will necessitate a change in the organizational structure. The structure will have a separation of employees to different departments. The departments will consist of different managers whose main job would be to coordinate the activities of the department and report the findings to the people in a higher position than them.

Discussion Response Four

The business brand that I create would be called Fundamental. The business will have to start as a sole proprietorship. This legal structure of business has a lot of advantages that it provides to startup businesses. Startups can enjoy low levels of taxation as compared to other forms of business. The low taxation levels help the startups as when businesses ate starting, they have a small number of resources and through the low taxation rates, these businesses can retain much of the proceeds that would have gone to taxes. After the business grows, I would convert it to a partnership. When choosing my partner, I would choose a partner that is conversant with the use of modern technology in the business sector. This will complement my knowledge of marketing and sales. The partnership will also improve the business as the new partner will come with more revenue to the table. This will increase the amount that the business can spend on marketing and other important aspects of the business.

Some of my colleagues have chosen different legal structures of businesses. Some o them have chosen the sole proprietorship structure. Although good for starting businesses, this structure becomes more of a hindrance when a business reaches a certain point. To curb this challenge that the sole proprietorship brings, other colleges have chosen to change the model to be a limited liability company after some time. Although this is better than sticking with the sole proprietorship mode, I still believe that's there are challenges to this model. One of these challenges is the high taxation rates that are imposed on companies.

References

Barringer, B. R., & Ireland, R. D. (2016). Entrepreneurship: Successfully launching new ventures (5th ed.). Don Mills, Canada: Pearson Canada Inc.

Ward, S. (2019, Jan 27). Different types of corporations in Canada. The small balance business. Retrieved from https://www.thebalancesmb.com/types-of-corporations-in-canada-2948060