I have previously provided my Top 5 Secrets Landlords Don’t Want You to Know list and thought I would provide another Top 5 list of the biggest mistake I see potential tenants make when they’re trying to find space for their business.  If you can avoid some or all of these mistakes, you’ll be way ahead.

The Top 5 Mistakes I see potential tenants make are:

1. Not forming a LLC or corporation first.  You should go into negotiations with your separate entity already formed and ready to be named as the lessee.  If you can avoid a personal guarantee, you’ll sleep easier at night.
2. Not knowing what to ask for from the landlord.  Do you want to abate the rent until you open for business?  Do you need financial help with the construction costs?  You need to think through what you will need before you sign the lease, after which it is too late.
3. Not understanding the terms.  What is a triple net lease?  What services will the landlord provide and which services are you responsible to provide?  If you haven’t negotiated a lot of leases, the terms can be confusing.  Make sure you understand all of them before signing anything.
4. Not being willing to walk away.  There is a lot of commercial space out there and you should be willing to move on to the next opportunity if you can’t agree on terms that make sense to your business.  Often, an entrepreneur will make changes to his or her business model to fit the lease - that’s backwards.  If you believe there is only one perfect location for your new business, then I would seriously consider a new business. 
5. Not understanding the costs of build out and start up before signing the lease.  Getting construction sticker-shock after you have signed the lease is a terrible, terrible thing.  Make sure you have a firm handle on the projected costs of getting your proposed location open BEFORE you sign a lease.  Once you’re in, you’re in and the landlord is not going to be sympathetic when you can’t make the rent payment because of your oversized start-up costs.

Keep in mind that in most commercial lease situations, the landlord and its agent will have much more experience than you.  They do this type of work everyday while most entrepreneurs will only negotiate a handful of leases in their working life.  This makes it crucially important to have experienced help in the form of a real estate agent and/or lawyer on your side to make sure you get the best deal possible.

If you’re thinking of starting a non-profit and wondering what form of entity you should use, this is the post for you.  Non-profits are different than for-profits, as I’m sure you know, because non-profits do not have "owners" in the traditional business sense.  You can’t build equity in a non-profit because all of its profits are plowed back into its activities.  So, for that reason, the form of business is different than traditional for-profit entities.

In Virginia, you may form a "non-stock corporation" as the entity.  This is very similar to a traditional corporation but with no shares of stock (hence the "non-stock" in the name).  The non-stock corporation is run by either a Board of Directors or Members, or a combination of the two.  More information regarding exactly how to form a non-stock corporation for your non-profit can be found here: http://www.dietzlawfirm.com/VirginiaNonprofits.htm.

And if you’re ready to start your non-profit and want to make sure it’s done properly, check out our new quick and easy formation service for non-stock corporations. 

One question I get a lot is: "what is the correct order of things to do when starting a new business?"  While there is no perfect one-size-fits-all answer, there is a generally accepted way of doing things. 

Here is the order that I typically recommend:

1. Form your LLC or corporation.  The reason to do this first is that all of your future agreements, whether they are leases for commercial space, contracts with suppliers, or your initial customer contracts, should be in the name of your entity.  Not sure whether you need to form a LLC or corporation?  Then read this article first: http://www.dietzlawfirm.com/5reasonstoincorporate.htm.
2. Obtain a tax ID from the IRS.  You’ll need this to open a company bank account and you can’t apply until you have your LLC or corporation approved by the State Corporation Commission.
3. Open a bank account in the name of your LLC or corporation.  NEVER comingle personal money and business money - it’s a bad idea for many reasons.
4. Get your county business license.  Every business needs to obtain a business license when starting out - check with your county or city government on how to get this done.
5. Get your state tax payment information submitted.  If your business involves collecting state sales tax from your customers, for instance, you will need to comply with the Virginia laws on remitting sales tax to the state.

When you follow the order above, things should flow smoothly as your new business starts.