Entrepreneurs often say their young companies are "their babies." They birth them, nurture them, and experience all the business' heartbreaks and triumphs in deeply personal ways.
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It's no wonder then that entrepreneurs take considerable time crafting business names that best reflect the spirit and creativity of the founder.
What's the best approach for naming your new business? Keep it simple. A business name, by itself, can't stand for everything that you represent or want to do as an entrepreneur.
Here are some other tactical considerations:
-DBAs. Sole proprietors can choose to operate a business under a trade name that is different than a legal business name. This is often referred to as "doing business as" or a company’s "DBA." What tends to trip up start-up entrepreneurs is the issue of personal accountability. Even though the sole proprietor can sign contracts, send invoices, maintain checking accounts and answer the phone as the DBA, the owner is still personally responsible for all business liabilities.
-The company is the brand. Coca Cola did it, so did Heinz, Gucci, Bose and T-Mobile. Selecting the same business name as the product name is a convenient solution. However, while it's easy to change a product name if it tests poorly in the marketplace, it is much more tedious and costly to formally change the name on business licenses, share certificates, bank accounts and contracts. Startup entrepreneurs should be really confident in the longevity of their first product names if it is the same as the company name.
-The founder's name. An easy option for many startup entrepreneurs is to name the company after its founder. It worked for Michael Dell, Henry Ford, Martha Stewart, Charles Schwab, Michael Bloomberg, Robert Mondavi, Oscar Mayer and snow board innovator Jake Burton.
The downside of giving your name to your new company is linking the business too closely to a single individual. This can work against founders of smaller businesses when tying to sell their businesses. Buyers worry about the potential for customer defection or perceived branding inflexibility. Founders and sometimes their family members may also be contractually restricted from pursuing new business activities within the same industry too.
-Registration conflicts. Before you commit any name to business cards and logo production, it's prudent to check for potential conflicts. Start by testing your candidate names at your state’s online business licensing department. Then visit the U.S. Office of Patents and Trademarks. The "PTO" offers a free online service called "TESS" that allows entrepreneurs to research recent trademark applications and trademark registrations.
While naming a company is not the same as seeking trademark rights for a product or service, it is important for entrepreneurs to be aware of potential legal challenges to a business name. Well-funded trademark owners can make life miserable and costly for little companies that choose names that are too close to a competitor's market interests.
-Test the name for ease of use. Can strangers pronounce and spell your candidate business name without error? Make sure they can. If you choose a business name that is difficult to say or spell, then you might make it harder for customers to find you online. Challenging business names also might reduce customer referrals and viral social networking activity.
-Evaluate potential Web presence. Can you obtain a domain name that is similar to your preferred new company name? Check it out. Also evaluate what your target customer audience might find in organic search results. Look closely at the paid and organic search listings on the first three pages of search results. Do porn sites appear? Preference should be given to names that draw the least amount of search competition or business name confusion.
Use the process of naming your new company as a learning experience. All important decisions involve some level of competitive and risk management analysis.
Susan Schreteris "The Entrepreneurs’ Advocate” and a 20-year veteran of the venture finance community and a university educator in entrepreneurship. She is the founder of www.takecommand.org, a community service organization that offers the largest centralized database of startup and small business funding sources in the U.S. Follow Susan on Twitter @TakeCommand.