Starting a Business? One More Thing to Do: Talk to a Business Lawyer
Joshua Davidson wrote this article
You are reading a guest blog post by Sheila Di Gasper.
You are racing fast trying to get your business idea off the ground. Your to-do list is ever growing while endless phone calls and meetings are eating up much of your time. Meanwhile, you are attempting to squeeze every bit of value possible from every dollar you have invested (or that family and friends have invested in you and your business idea). Hiring a business lawyer is probably not the first, second or even a ghost of a thought at this point, but that would be a mistake. Taking some time to talk with a business lawyer and making him or her part of your advising team will save major headaches and money in the long run, and increase your chances to succeed.
An experienced business lawyer will help you identify and address any weaknesses in your business and business plan; protect your intellectual assets; reduce your personal and business liability; streamline some of the pesky formalities and legal requirements of starting and operating your business and provide general advice. By finding your lawyer early on, you’ll have the benefit of a legal advisor who knows you, understands your business and appreciates your goals.
Below are a few things that you should be discussing with your lawyer in the early stages:
Am I protecting my business idea?
Of all the business assets you hold early on, your “big idea” is the most precious asset of all. Your business idea is your intellectual property and you’ll want to ensure it remains yours and is legally protected by copyrights, trademarks, or patents.
What if I have partners?
Believe it or not, conflicts among partners very often lead to a startups failure before it even gets off the ground. This failure is due to lack of preparation and planning. If you have a partner or are considering partnering with someone, there are agreements that will protect you so that your business runs smoothly even in conflict.
Should I form as a legal entity?
Yes. The answer to that question is always yes. However, whether or not your business should be a corporation or an LLC- well, that depends on. Consulting with a lawyer on how to file your business will save you from incurring higher taxes or significant liabilities down the line.
What contracts do I need with my employees and independent contractors?
Employment documents are usually not the first thing on a new founders mind but can lead to some serious snags in business operations. You’ll want to consult your lawyer regarding the types of documentation you’ll need when you’ll need it, and what language is necessary for different types of employment.
When should I give employees and independent contractors equity incentives?
There are many ways to incentivize your employees. Your lawyer can tell you what options you have and help you avoid giving away too much of your business in the early stages.
What contracts do I need with my customers and/or clients?
The idea of drawing up contracts with your customers and/or clients may sound like a bore but it will give you and your business solid legal protection when you need it. Depending on the type of business, there are many different contracts to consider.
Now that I have told you why you need a lawyer, you are probably wondering how to choose the right one. Doing some research online or reaching out to your network for referrals for a business lawyer is a good place to get started. A quick e-mail to a lawyer to set up a time to talk is all that is needed to get going on this piece of the business puzzle. If the lawyer does not get back to you right away, move on to the next person. You will want someone that is interested in you and your business to be on your team. The right lawyer for your business will be the lawyer that has experience, can answer your questions, and most importantly someone you can develop a good rapport.
Having a lawyer that knows you and your business can reduce the time it takes to get up to speed and help out with matters in the future.
About the writer of this guest blog post: Sheila Di Gasper is a business lawyer with Ingram Yuzek Gainen Carroll & Bertolotti, LLP. Sheila represents clients in a broad range of corporate and securities transactions, including mergers & acquisitions, debt and equity financings, restructurings, divestitures, joint ventures, bridge financings, growth and seed investment and venture capital transactions.
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