Over the past nine months, our discussions have ranged from what it takes to start your own venture to learning more about enterprises in various sectors. Whether it be real estate, travel, share trade, healthcare, education, or even gaming; this startup series has featured some of the most promising entrepreneurs of the country.

 

However, the one area that we are yet to touch upon is the chapter that only some entrepreneurs prepare themselves for. Yes, it is closure. 

Let’s face it. There are MANY aspiring business people in the world. Some are able to make their mark, some try hard and are yet to do so, while some others are probably discovered their inability to run the show over a period of time. It is hence, advisable for entrepreneurs to consider winding up in case it is beginning to show signs of a downfall. This could be evident from the Profit and Loss statements of the company and the balance sheet. 

 

Many experts have often encouraged young aspiring businessmen to re-strategise and reconstruct their business models. But sometimes, shutting down a company is a blessing. Why? For starters, you can focus your energies towards something new and probably fun – like a new course, or even something as simple as spending quality time with your family. Also, you would be surprised to see how much you would have learnt even as the company breathes its last. 

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But closing a company is walk in the park. This process is heavily dependent where your company stands in terms of expenses, incomes, profits and losses. In my opinion, these factors are directly proportional to the goodwill and the duration of the closure procedure. Basically, if an entrepreneur has incurred large expenses and owes money to a lot of people, the process will take longer than expected. But if he or she played it safe and had a rather balanced approach to the finances of the business, the situation is likely to less intense.

Also listen to this: Podcast | Startup and You: Episode 13 - Digital payments in Indian startup ecosystem

Here are a few aspects that you must look before shutting shop:

1. Go through the legal agreement and or other relevant documents related to the company

2. Discuss the decision with all parties involved in the venture

3. Seek the assistance of the chartered account to find out if there are any pending tax filings or payments

4. Sort out your finances and pay the amount due to each and every one of those persons who have been part of the venture till the day you had decided to stop operations

5. If you do have websites and social media pages, take necessary steps to ensure that content is not visible or misused. This must be done only after all parties come to a consensus

6. Maintain a record of your financials even after the company has closed. Discard the all financial documents only after cross-checking the facts with the chartered account and the other persons involved.

You can also listen to this: Podcast | Startup and You: Episode 10 - Covid-19 and entrepreneurship opportunities

It is disheartening to put an end to a project that would have stemmed from a dream or a desire to make a small difference to the world we live in. But, like our elders tells us, our destinies have been chalked out. We need to discovers the many pathways towards it. 

Feel free to share your thoughts on startups, entrpreneurship and business at gitanjali.diwakar@thehindu.co.in.

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