Startups, Business Licenses and Permits: A Necessary Combination for Success

This summer, the new trend has been the colorful yellow and lime bikes all across the country in urban-downtown areas, parks and neighborhoods creating an inexpensive, fun way to transport or tour these cities. Creating a new buzz, “Bird” scooters recently made a quick glimpse into many downtowns across the country, before being quickly taken away in St. Louis due to the company overlooking one very important step in their launch.

These scooters are designed to give commuters an easy way to zip around the city, ideally within a mile of their intended destination. Bird Scooters can be used through an app and cost $1 to begin riding plus 15 cents per minute thereafter. The scooters can reach a max speed of 15 mph and remain charged for 15 miles. CEO & Founder of Bird, Travis VanderZanden created his, “SOS Pledge”(Save Our Sidewalks Pledge) to reduce car trips – especially 40% of trips under two miles – reducing traffic, congestion and greenhouse gas emissions. They will also remit $1 per vehicle per day to city governments to build and promote more bike lanes, and safe riding.

While their intent was good, they did not obtain the appropriate business license required by St. Louis to legally operate their business in the city. This lead to them having to take a temporary leave of absence. All new businesses in the city are required to register to do business in the city.

Check City and State Requirements

Which brings up a very important bit of homework for all startups, and not just bike and scooter sharing services. When creating a business entity, depending on where you are going to do business, the state or city may require you to have specific registrations or permits. Many businesses do not realize that these exist, but it is critical for the success of the business to be aware of these as they can impact a startup’s ability to do business in a city or state.

Bird Scooter is a prime example of what could happen to your startup if you do not obtain the required licenses, permits, and/or registrations for the city and state you would like to do business in.  Make sure to research the locations of where you would like to do business to determine the required licenses, permits and/or registrations.  This way, when the new product is finalized and ready to showcase to the paying public, you won’t have a roadblock to success.