Saturday, 27 September 2008

Setting up the Company

Government and Companies House pride themselves in making business more accessible and reducing red tape. I was going to take them at the word and set up a Limited Company on my own. From what I could see I needed to fill out a few simple forms and send them off with a fifty quid cheque and my liability would be limited.

I was keen to pass from the ranks of the talkers to those of the doers. I had advised about setting up charities, companies house and being a charity director so I felt that I had a little insider information. (Maybe this was another source of my cynicism for Business Link, had they, like me, merely read the Internet and a skimmed few books to prepare themselves for the role of adviser).

I sailed past first base, understanding the need and purpose for a Limited Company. I could also navigate my way around the Companies House site. I was further delighted when I came across that sent a three email tutorial on How to Set up a Limited Company, including a free document to help with write your Memorandum and Articles worth £24.99. I went to work to prepare my Articles, the Memorandum of Association and the all important forms 10 and 12.

The first delay was getting the right software to amend eSource's template documents. So I downloaded a free trial of Adobe Acrobat and squandered hours setting this up, then read endless clauses, sub clauses and exemptions. I cross referenced this with the hallowed 'Table A' that is so critical to company law (if you want to know more go to Companies House and search for it, reading it makes paint drying seem a dynamic spectator sport). Things were going swimmingly until one of the two key forms need to be signed by a notary or a solicitor...

I knew that I needed legal help, and it was just a matter of time until I started to shell out cash for my dream of professional* self sufficiency, so I took up Business Link's advise and tracked down a 'Lawyer for Business'. A bargain, I thought, a free half hour consultation. It was very simple finding one, I contacted the Law Society who sent a list of participants in my area. I did a search on the most local lawyers; only one seemed to focus on business (divorce is not on my mind and most of the lawyers on the list seemed to rank this as their preferred sport) so I booked an appointment with him.

To get the most out of the session I was going to get the documents signed and talk about other legal aspects of the business. This week has been a frazzle of terms and conditions. What would the business be doing? what did I need protection against? what do other similar companies put into their terms? (and why do they need to registered in Luxembourg)? I came up with twenty odd pages of document for the unfortunate lawyer to unpick.

If there is a theme to my journey into business it must be this: set aside everything that you think you know and prepare for it to cost more! The lawyer seemed a great guy, but he did ask impertinent questions. Had I read Table A? Yes - one up. Did I understand it? No - lip starts to wobble. Had I thought about half a dozen wise issues that these pro-forma documents would fail me on? No - over and out.

All I can say is that this free half hour consultation has cost me a fortune! I understand that if I want Mothers of Innovation to have a long term future I really need to get the legal footings solid. I walked out daunted and since have signed up to a course of action that will cost me over £800 but should set me on clear course to focus on the bits that I can really do well.

*I will start another blog when I renew focus on my other aim for real self sufficiency, but then again will a chicken poo generator power this computer?

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