Becoming a software developer and starting your own software company can be an exciting job opportunity if you excel in computer science and programming. The U.S. Bureau of Labor Statistics (BLS) reports that jobs available in the field are growing at a rate more than five times higher than the average growth rate for all occupations, as people quickly adapt to using computer software throughout their daily lives.

If you have skills in this area and a vision of what you can do as a software developer, here's a step-by-step guide on what you need to know about starting your own software business and thriving through the early stages of your company.

What You Need to Know to Start a Software Company

While you don't need any particular license to start a software company, you will need quality education in the computer field. Software developers need to have a firm understanding of computer programming and computer languages so they can build products from scratch. They should also understand different types of coding and have experience with major systems, such as Microsoft and Apple.

While it's not necessary to have a degree in computer science to create software products, many software developers find it helpful. You should also think about getting various credentials and certificates for programming languages and related computer skills. This can help inspire confidence in potential customers, particularly if you're setting out on your own for the first time and don't have an extensive portfolio of past work.

Though not required, many software developers find it helpful to gain experience by working for other companies before they begin their own. This mentorship can give you a better understanding of the industry and the ability to practice various skills in a controlled environment.

Getting Ready to Start Your Software Company

Once you've secured any certificates, degrees, or experience that you feel will help you build a strong software company, you can begin to put your business idea to work. Create a firm business plan that will guide you through the initial software startup phase. It'll also be necessary if you want to open a business bank account or apply for a business loan or similar financial product in the future.

Know Who You Want to Work With

The first part of your business plan should address the target audience you want to serve and the type of software you want to specialize in. Computer software has been adopted across nearly every industry, from banking and finance to education, making programmers in high demand. Some companies operate under a software as a service (SaaS) model while others design software for customers to use independently.

If you decide to specialize in software for a particular industry, you will need to prepare yourself. When reaching this target market, you will have the most success if you also have experience within that industry. For example, if you want to work on educational software development, having an understanding of education models and what schools want for their classrooms can help you stand out from the competition and do the best possible job.

Calculate Your Initial Costs

You also need to consider startup costs. If you will work in an office space, you'll need to calculate the cost of rent or the mortgage on the location. If you need specialized computer equipment to help you get started or insurance to protect you professionally, it'll be important to have a firm understanding of these initial expenses.

Determine the Pricing for Your Jobs

You will also need to determine how much you will charge clients for different types of jobs. As a software developer, you may find it helpful to set both an hourly rate and a rate per project, depending on your business model.

The national average hourly rate for software developers is between $75 and $400, with fees varying considerably depending on the experience of the developer and the type of expertise they can offer. You can set your project rate based on the amount of time the work typically takes, the type of language you will use, and your experience and expertise in that particular area.

Establishing Your Software Company

Once you've created your business plan to guide your new software company, you can begin establishing yourself and finding your first clients.

Setting Up Your Software Business Legally

Your first step in forming your business involves selecting a unique name. Many states have a searchable directory that allows you to verify that your proposed name is not already in use by someone else. Once you have a name, it's time to choose your business structure.

You may decide to become a sole proprietorship, partnership, limited liability company (LLC), or corporation with shareholders. Many small businesses decide to go with the LLC model due to its simplicity and liability protection. If you decide to go with a legal entity like an LLC or a corporation, you'll need to register with your state by submitting your name and documentation showing how your business will be run and the rules that will govern it. Check with your secretary of state's office for more information.

Once you have created a legal entity for your business, you can also open a bank account. A bank account will allow you to keep your business finances separate from your personal finances. This benefits you at tax time, simplifies your accounting, and can help you when applying for a business loan, seeking venture capital, or attracting angel investors if you need to document your business's finances.

During the first year of operating your software business, you will also likely want to speak with an accountant who specializes in small businesses. They can help you understand your tax requirements and obligations so that you feel confident when it's tax time.

Invest in Your Software Business's Marketing

You want to help potential clients find your business so that they can discover what you have to offer. There are a few ways you can go about this.

Create a Logo

Your first step should be to create a logo. You want something that will help capture your brand and what you want to communicate to customers. Use imagery that customers will associate with software development to create a recognizable image.

Various color palette tools, like Adobe Color, can help you match colors together and find one that fits your business. You can take advantage of outsourcing and employ freelancers on platforms like Upwork if you do not feel confident in your graphic design abilities.

Build Your Web Properties

You want to have a presence on multiple web channels, as well. Begin by creating a website with a domain that accurately reflects your business and that clients can easily remember. Although you may feel confident in your ability to build a website from scratch, there's no denying that this type of project takes time. If you would rather let someone else handle the creation of a professional website - so you can shift your attention to other aspects of the business - consider using freelancers for this part of the process, as well.

Pay careful attention to your social media channels as you build your business. Set up your profiles on sites like LinkedIn and Facebook. These platforms let you connect with people and easily spread the word about your new business to others. You can market yourself on them without spending a lot of money.

Prioritize Local Search

Your priority is to help people who are looking for a local software development company find you. Claiming your Google My Business page can be a great way to get started on this task. Fill out the profile completely, engage with people who ask you questions, and post high-quality images to showcase your work.

Actively Promote Your Business

Entrepreneurship requires you to be your own best salesman. Let people know about your new company and liberally hand out your business card whenever you find yourself in the company of professionals who might use your services.

You might even consider attending events and conferences targeted toward software development or the industry of your specialization. This can help you make more connections and expand your reach.

When you bring in your first clients, let them know you always appreciate referrals and positive reviews if they seem happy with the work.

Your Daily Business Tasks

As a small business owner, you will need to prioritize time for a variety of administrative tasks associated with running a business. These tasks will help you keep your business finances straight so that you can accurately invest in your company and find opportunities for growth. It will also help you track your financial situation so that you can confidently fill out your tax forms and know that you have accurately paid your state and federal taxes.

To accomplish these goals, software that has been designed specifically for small businesses can help. Skynova's software products were designed to make accurate accounting simple and straightforward for business owners like you. This software can help you manage tasks, such as creating and tracking:

With Skynova's accounting software, you can easily see which clients have paid their balance on their invoices and how much money you have put into your business accounts. Skynova also helps you keep your expense and income columns organized so that you can tell at a glance when you can invest in your business growth and what you owe at tax time.

Are You Ready to Begin Your Software Company?

Starting a software business can be an exciting time. You have the chance to use your skills and interests to begin your own company and achieve your goals. To help you achieve this vision, Skynova is here to help with your accounting and business needs.

Skynova was created with the small business owner in mind. You have access to a host of business templates, including invoicing to track payments. Our accounting software also empowers you to accurately and easily track your books. It's time for you to start building your latest software product idea - let Skynova help you dive into your dream.