Don’t Make These Mistakes When Starting a New Business
Starting a new business can be exciting, and still be one of the most stressful things you will ever experience. There are many things to do, and some of those are legal aspects that many people don’t even realize. Because the role of an entrepreneur is often focused on their customer, there are some common mistakes that are made when owners are getting ready to start a new business.
- Business Structure – Choosing the right business structure not only reduces your liability, but it helps manage your taxes. Whether you choose a sole proprietorship, some type of corporation, a partnership, or limited liability corporation, the structure should meet the needs of your unique business.
- Founder Agreements – Before exchanging work ideas, be sure you put together an agreement in writing that outlines the responsibilities and roles of each party involved. The agreement should outline ownership percentages, voting protocols, removal grounds, and more.
- Employee Documentation – This is critical for keeping company secrets private and limiting liability. You should have termination rights, worker classification, and more in the documentation. You may also need to consider creating and implementing non-disclosure agreements.
- Restrictive Covenants – Businesses are streamlined in today’s world. Be sure that you are protecting your intellectual property with non-solicit, non-compete, and other types of agreements to protect inventions and information.
- Contracts with Outside Vendors – Even if you have been working with an outside vendor for years, you need to have a clear contract in place with them. Dictate the rules of business between you and the vendor to reduce any possible friction that can occur from working together.
- Patents, Copyrights, and Trademarks – When it comes to protecting your assets, you need to be certain that you are filing trademarks, patents, and copyrights as necessary to protect all intellectual property. Depending on the type of business you have or the product you are selling, there may be a variety of laws associated with keeping it under wraps. Your attorney can help guide you through the process.
- Succession Planning – No one ever wants to think about the day the business will come to an end or the time when you will leave your business, but there are a lot of financial and logistical decisions that occur when this stage of the business happens. Particularly if there is more than one partner in a business, you need to be sure that a succession plan is in place.
- Failure to Hire an Attorney – Many people mistakenly believe that if their business is small, they don’t have the legal responsibilities of a large business, but that isn’t true. An attorney can help you set up your business correctly so that you aren’t vulnerable. One lawsuit for a small business can mean the end of your business.
Contact an Experienced Business Planning Attorney Today
Tampa business transaction & formation attorney David Toback has experience helping his clients get their businesses off on the right foot and can help you too. Contact us today to schedule a consultation to be sure that you are protecting your assets and yourself as your new business gets going.