This text provides a concise overview of the key aspects of business planning, different forms of enterprise, the costs associated with establishing a business and potential sources of financing. The information has been compiled from the Suomi.fi website.
By: Joona Kupiainen
When you are considering the form of your enterprise, i.e. the company type, you should choose the most suitable type for your business. Company types differ in many respects, including in terms of the number of founding members and ease of administration. Based on the information available on the Suomi.fi website, this text summarises the business planning stages and the specific characteristics of different company types to help you find the most suitable form of business for your purpose.
Business planning begins with a business idea and a business plan based on it. The business idea precedes the actual business concept. It outlines the purpose for which you want to establish a business and conveys the fundamental idea of your business activities. The foundation can be a product, service or a problem you can solve. The business concept is a more tangible refinement of the business idea, typically answering three basic questions: What does your company offer, to whom, and how? You can read articles about selling your artwork and expertise here. Based on the business concept, you create a business plan that describes how your company will implement its idea in practice. The plan describes your core competencies, target customers, competitive situation and business risks. It also includes calculations on profitability and financing. A business plan is usually required when applying for start-up assistance or business financing. You can use the Job Market Finland platform to create your plan.
During business planning, you can use the Business start-up wizard on the Suomi.fi website. Advice is available from the Enterprise Finland advisory service and Uusyrityskeskus (the Finnish Enterprise Agencies).
When establishing a business, you must choose a suitable and compliant name. As a new entrepreneur, you also need to acquire a self-employed person’s pension insurance, mandatory insurances related to your business sector and any voluntary insurances you deem necessary. You can read more about insurances on the Suomi.fi website. In addition, your business needs a bank account, as bank statements are a crucial part of accounting. Your business may also require separate premises. As a rule, you should register your new business at least in the Finnish Trade Register and the Prepayment Register and, if necessary, in the Employer Register and the VAT Register.
Foreign employees and entrepreneurs need a permit to work and operate as entrepreneurs in Finland. Find out what licences and registrations are required in Finland here.
As a private entrepreneur, you can easily engage in small-scale business primarily based on your own work input. You can establish the business alone and are solely responsible for its decisions. Private entrepreneurship is the simplest and most straightforward business form, as it is easy, quick and inexpensive to set up. It is suitable if your business operations are relatively small and mainly involve your own work. You can become a private entrepreneur by submitting a start-up notification, after which you will receive a Business ID. You must also register your business in the necessary Tax Administration registers. The registration fee for a private entrepreneur in the Trade Register is EUR 70. As a private entrepreneur, you cannot pay yourself a salary but can withdraw money from the business as private withdrawals.
A limited liability company can be established either alone or with several partners. If you are establishing the company alone, you still need at least one deputy member for the board of directors. Submit the start-up notification for a limited liability company electronically through the Business Information System. The main governing bodies of a limited liability company are the general meeting, the board of directors and the managing director. As a founder and shareholder, you can participate in decision-making through these bodies. You can read more about these bodies and their activities here. A limited liability company is suitable if your business operations are larger, aim to expand and have multiple founders.
When establishing a private limited liability company, there is no mandatory minimum share capital. However, you can choose to invest share capital in your company and use it for initial business purchases, for example. If you establish a public limited liability company, the minimum share capital is EUR 80,000. You can read more about share capital here. The registration fee for a limited liability company in the Trade Register is a few hundred euros, depending on whether you register electronically or on paper. You can withdraw money from the company as salary, dividends, kilometre allowances and per diem allowances.
A cooperative is particularly well suited for joint entrepreneurship, regardless of the industry. You can establish a cooperative either as a private individual or as an entity. Through a cooperative, you can easily sell your expertise with relatively low risk and without significant initial capital. You and any other members must pay a jointly agreed membership fee when establishing the cooperative. The registration fee for a cooperative in the Trade Register is a few hundred euros. The start-up notification for a cooperative is submitted to the Trade Register using a paper form. The main governing bodies of a cooperative are the board of directors, the cooperative’s general meeting and the managing director. You can read more about these bodies here. You can withdraw money from the cooperative as salary, kilometre allowances and per diem allowances. A cooperative can also distribute surplus. Generally, you are not considered employed by the cooperative if it has at least seven members. This means that during periods of unemployment, you may be entitled to unemployment benefits despite being a cooperative member.
A general partnership and limited partnership are similar in many ways. The process of establishing these companies is broadly the same. Submit the start-up notification to the Trade Register using a paper form and also register your company in the Tax Administration registers. A general partnership is particularly suitable for small-scale business operations with a trusted partner. A limited partnership, in turn, is well suited for business based on your own work input, in which you want to include an investor. In other words, a limited partnership can include silent partners who invest in the company but do not actively participate in decision-making.
You can establish a general partnership or limited partnership with one or more partners. The registration fee for a general partnership or limited partnership in the Trade Register is EUR 280. From a general partnership or limited partnership, you can withdraw money as salary, kilometre allowances and per diem allowances. You can also withdraw money from your business as private withdrawals.
You can also operate as a part-time entrepreneur, with the most common and easiest business form being a private entrepreneurship. Part-time entrepreneurship means running a business alongside full-time employment or studies. You can also start part-time entrepreneurship as a light entrepreneur. In this case, you do not establish your own company but receive payment through an invoicing service for the work you do independently. You typically receive your earnings as salary. As a part-time entrepreneur, you are not eligible for start-up assistance. You should also note that as a light entrepreneur without a Business ID, you may still be considered an entrepreneur when dealing with Kela (the Social Insurance Institution of Finland), for example, regarding unemployment benefits.
When starting a business, you usually need funds for initial purchases. It is advisable to reserve working capital for running expenses for at least two to three months. You also need money for living expenses before your business generates sufficient income.
To finance your business, you can apply for start-up assistance, which secures your livelihood during the initial phase of your business activities. The start-up assistance must always be applied for well in advance before establishing the business. If you start your business while unemployed, you can still receive unemployment benefits for four months. In this case, any business income is adjusted against the unemployment benefit. However, you cannot receive both unemployment benefits and start-up assistance simultaneously. You can read more about entrepreneur support here.
If necessary, you can also apply for loans from banks or other financial institutions. If your business lacks the collateral required by banks, a partial guarantee from Finnvera, known as Start Guarantee, which the bank applies for on your behalf, can facilitate financing. Once your operations have commenced, you can also apply for cultural-sector grants for your projects and activities. Find out more about grants in this article.
Suomi.fi. Forms of enterprise. https://www.suomi.fi/company/starting-a-business/forms-of-enterprise (accessed 1 April 2025).
Entrepreneur Fund. “Voinko tehdä töitä osuuskunnan kautta työttömänä ollessani?”. https://yrittajakassa.fi/tietopankki/voinko-tehda-toita-osuuskunnan-kautta-tyottomana-ollessani/ (accessed 9 April 2025).
