thoughts on choosing a business name

Thoughts On Choosing A Business Name

For those of you looking to start a company, I’d like to share some advice that I missed and/or ignored early in my life. It’s this… when you name your company, make it as GENERIC as possible. Follow me on this…

 

My business naming mistake…

 

In short, I made the mistake early in my business of naming my company with a part of my name. This was around 1997. It started out because I was consulting, and there was nothing else for me to consider. I mean… it was just ME… doing technical consulting/programming. It was never going to be anyone else, but me, so no big deal. The internet was still relatively new. I wasn’t looking to build a “company”.

 

Fast forward 3 years or so, and I had had some small internet success consulting and training on a niche software product. Within that niche industry, I started selling software add-ons. This was the beginning of a 20 year company naming fiasco.

 

 

Semi-famous software sales (big fish, small tiny pond)…

 

It took a few years, but by 2003 or so, I had established a small brand within this niche industry. In much the same way that Salesforce is known for CRMs, I (my company) was becoming known within this niche industry for my add-on software. And once the “bigger” money started coming in — at least big to me (100K in recurring revenue), I was focused only on growing — I didn’t even think about changing it. And then as the yearly recurring revenue grew to 200K, 300K, and 400K per year by 2013, I grew even more scared to change it. After all, I was “known” within this niche industry (there were only about 10 companies creating software for this niche industry). My company was just me and eventually my wife. It was just us making 6 figures of recurring revenue out of our house. I had a good thing going.

 

Folks were searching my name to find my software. Imagine I called my company BobCom LLC. When you see people are googling “bobcom software” or “bob software” to find you, and you’re making half a million in recurring revenue working out of your house, you would be leery to change it, too. This recurring revenue “problem” peaked at 700K per year by 2017 (and still just me and my wife as the only employees).

 

But what if I know I’ll never be “big”…

 

But what if I want my company name to be “personal” …

 

You might think, yeah, but what if I really want to use something specific and personal like “Bob’s Real Estate Partners” (something that describes what you’re doing). I would recommend you create a company random name like “Simple Holdings LLC” (100% made up name), and create a DBA for your real estate as “Bob’s Real Estate Partners” (or better yet “Simple Real Estate Partners”). The DBA allows you to experiment with different names, but none of them or really legally binding. You can switch, add, or delete a DBA pretty easy. You can change your LLC/Inc name, but it’s a more complicated.

 

And you may never expect to be “big” (different meaning for different people), but it can still happen… or at least you can grow big enough that someone wants to buy your business. It doesn’t matter what industry it is. Maybe you are a local guy or gal that does taxes. I knew someone in my small town in Louisiana where I grew up that did personal tax filing for “neighbors”. This grew to about 1000 customers all while working out of a converted garage/office. Larger accounting firms acquire “small” businesses like that all the time just for the list of names if nothing else. And it’s much easier (smooth) to sell a business like that if it’s named “Simple Tax Services” instead of “Bob’s Tax Service”. It’s kind of hard to keep doing business with that name when Bob is no longer around (or worse has died).

 

My business naming fix…

 

Anyway, I fixed my issue in 2020 by renaming my LLC. I couldn’t take it anymore.  Now I can use the LLC on legal documents for my software company, books, movies, etc… it doesn’t matter. I have a really generic name. And my mistake of calling my LLC “BobCom” became embarrassing, too, when I had to start signing legal documents or telling anyone my company name. Filling out any paperwork… it just sounded dumb. And my son who worked started working for me in 2017 didn’t want to give out the “BobCom” name when asked where he worked. I don’t blame him.

 

Also be careful naming a company based on your state, city, or location. For example, imagine a name like “Seattle Coffee Company”… especially if you ever expect to expand the brand. A generic name like “Starbucks” works much better. Right?

 

The one last point, too, is the generic name gives you more “stealth” in terms of the business name and your part in the company. When your name is Bob, though, and your company is “BobCom”, it’s pretty obvious what you do. When you have a generic name like “Simple Holdings LLC”, and you put that on paperwork as your employer, you can put any job title you want, and no one will know you own the company. Same goes for Christmas parties and the likes… people ask you what you do for a living… oh I do software for a small company named “Simple Software”.

 

This isn’t new advice…

 

This generic naming isn’t anything I came up with of course. I read it MANY times in business books and magazines over the years. I did not heed the advice when I first started, and I avoided changing it for a long time. It’s so much nicer signing my GENERIC LLC name on everything now, though. I didn’t use HOLDINGS in my new LLC name, but “HOLDINGS” is a good one to combine with a generic word, though… “Wealth Holdings LLC”, “Software Holdings LLC”, “Family Holdings LLC”, “Stealth Holdings LLC”… I’m starting to like the sound of “Generic Holdings LLC” and “Simple Holdings LLC” — I’ve used it so much in this article. Haha.

 

Lots of companies using personal names have been quite successful (Dell and Ford are two that quickly come to mind). So… it can be done, but I recommend you not attempt it. I hope my company-naming story helps someone. Thoughts? Anyone else ever make my same business naming mistake?

 

A rose by any other name would smell as sweet.

William Shakespeare

Generic names are quite stealth and can be much easier for business use.

Mr. Hobo Millionaire
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Written by Mr. Hobo Millionaire
I blog about money, financial independence (FIRE), life, and entrepreneurship. I got rich slowly (over 20+ years) with a niche software business. I also failed at a number of other things (and mild success with a few others). I share what I did right along the way, and a lot of what I did wrong, with a goal to encourage you think differently about life and money.