Virginia has over 720K small businesses, which make up nearly 99.5% of all businesses in the state. 

These companies employ a massive chunk of the population as well. Nearly 47% of the entire working population of the state, i.e. 1.5 million people, works at these small businesses.

How to Open a Company in Virginia 9 Steps You Need to Take

Image via Small Business Administration (SBA)

To become one of them, you must know how to open a company in Virginia. After all, you don’t want to end up missing out on the “Golden Age” of entrepreneurialism in the city of Richmond. 

So, how can you open a company in Virginia?

Let’s find out.

How to Open a Company in Virginia

Here’s how you can open your company in Virginia in a few easy steps. 

1. Decide on an Idea

The very first step that you need to take to open a company in Virginia is that of coming up with an idea for the business.

You must be clear on what it is that you want to do through your small business.

Sit down and think about the feasibility of the business idea before you charge ahead and establish your business model.

Research the competing businesses in the state and figure out if they’re faring well. It’s a good benchmark to get an idea of the probability of your success.

It’s also crucial to understand the consumer sentiment and figure out if they want to purchase the product or service that you plan to offer. 

2. Choose Your Business Structure

The next step to open a company in Virginia is that of deciding on the legal structure of your company.

Some of the business structures that you could choose in Virginia are:

  • Sole Proprietorship: In this structure, you’re the only one doing the business.
  • Partnership: If you’ve got a partner (or partners), it’s a partnership business.
  • Limited Liability Company (LLC): An LLC is a formal type of business structure that encompasses features of both corporations and partnerships. It provides limited liability to the members.
  • Corporation: A corporation is a separate business entity that has a structure that includes directors, shareholders, and even officers. It’s the most complex business structure among all.

Many small businesses choose to form an LLC in Virginia to conduct business because LLCs are easier to form, require minimal compliance, and offer flexibility in management structure. However, you can also choose more complex business structures such as a Corporation to open your company in Virginia.

3. Select a Business Name

The next step in the process of opening a company in Virginia is that of selecting a business name.

If you pick a generic business name, it might make your business unnoticeable. Your target audience may not even figure out what the business is all about. On the other hand, a very specific name may limit your audience.

You also need to check if you’re not infringing on some other business’ trademark or copying their name. So, you need to sit down and find a unique name for your business that doesn’t lead to any legal ramifications.

4. Register the Business

The next step that you need to take is that of registering the business name. Here’s how you can go about the process:

For Establishing an LLC

  1. You need to file your Articles of Organization with the Virginia State Corporation Commission. You can do this via the Virginia New Entity Formation website or via email. The fee for this is $100.
  2. Once that’s done, you can hold an Organizational Meeting to accept contributions from your members and issue Member Certificates. This needs to be done for even a single-member LLC. You also need to write your company Operating Agreement. 

For Establishing a Corporation

  1. Just like limited liability companies, you must file your Articles of Incorporation with the Virginia State Corporation Commission. This can be done through the Virginia New Entity Formation website. The filing fee is $100.
  2. Hold an Organizational Meeting where you can organize the corporation and accept contributions from your shareholders. In the meeting, you should also elect the directors and offers, adopt Corporate Bylaws, and issue stock.

However, getting your new business registered in Virginia can be complex and time consuming, if done directly through the state’s websites.  To make the process easier, we have created the following start-up packages with ease and affordability in mind: LLC Filing Package and Corporation Startup Package. We can handle all of your registration work so that you can concentrate on establishing your company in Virginia.

5. Obtain Your Federal Employer Identification Number (EIN)

The Federal Employer Identification Number (EIN) is the most important number for your company. It’s the equivalent of the Social Security Number for companies.

It’s a necessity for LLCs and Corporations to get EINs. Without an EIN, you can’t hire employees or open a business bank account. Even if you don’t intend on hiring employees, it’s essential to have an EIN for your company in Virginia.

To get your EIN from the IRS, and to file your Virginia Articles of Organization or Incorporation, all you need to do is fill out this simple form to start your Corporation or LLC in Virginia. We’ll file for your EIN with the IRS as a part of the business formation package. If you are starting an S-Corp, there is a separate application here

6. Create Business Bank Accounts

Now that you’ve got your EIN, your business will be eligible for a bank account in Virginia. Having a separate account for your business ensures that you can keep your personal and business-related expenses separate. 

Once you’ve created a business bank account in Virginia, you can apply for a business credit card as well. This can help you build up your credit profile which can come in handy at a later stage to get loans and credit.

The process for opening a bank account is subjective to the bank you decide to open an account with. You can call your bank and inquire about the steps involved and accordingly go ahead with the process.

Some of the documents that might be required are:

  • EIN 
  • Company resolution to open a bank account
  • Filed paperwork

With our start-up packages, you get up to $450 cash back from two of the top banks for new and small businesses: Chase and Bank of America.

7. Get Relevant Licenses and Permits

Registering your business, getting an EIN, and opening a bank account aren’t all you need to do to start a business in Virginia. Each business also has numerous licenses and permits that are needed for it to operate.

The business license and permits are issued by different agencies. You can check their websites for relevant information. For instance, if you want environmental permits, you can head to the Department of Environmental Quality.

What else, you ask?

Some of the licenses are also subject to the state of Virginia. For these, you’ll need to check out the state government’s website such as the Virginia Department of Professional and Occupational Regulation (DPOR)

8. Check Zoning and Your Business Location

Once you’ve got everything in place, you’ll also need to find a location for your business. Without a business location, you’ll not be allowed to establish your business. Even if you’re working from home, it’s essential to your business location specified. 

9. Get Business Insurance

While insurance isn’t a necessity for all businesses, it’s essential for many businesses, especially ones which have a brick-and-mortar presence. When you open a company in Virginia, you should try to safeguard it from catastrophes through your insurance. That’s why it’s necessary to select the right type of business insurance. Some of the common ones are:

  • Workers’ Compensation Insurance
  • General Liability Insurance
  • Professional Liability Insurance

The general liability policy is helpful for all sorts of businesses. The workers’ compensation insurance is a necessity if you’ve got more than two employees.

Lastly, if you offer professional services, you can opt for the professional liability insurance that’ll protect you from negligence claims made by clients. 

Ready to Open a Company in Virginia?

When you’re just starting a business, you might find it challenging to figure out how to open a company in Virginia. However, the process, though lengthy, can be streamlined. 

You need to come up with an idea, choose your business structure, register the business, obtain an EIN, and start off. It’s also necessary to create bank accounts, check zoning regulations, obtain relevant permits, and get business insurance.

With professional help from GovDocFiling, this process is quick and easy. Learn more about what the LLC and Corporation start-up packages include, and get started today!