When launching a startup company, founders tend to focus entirely on getting their product or service out to the market. But it also matters you be mindful of the legal implications of your business and records. You need to get in touch with business attorneys at Lusk Law Firm sooner rather than later to help your startup company avoid adverse legal consequences in the present and the future.
You can begin a startup company by yourself or with the help of a partner/partners, family members, or other investors who may not be involved with the daily running of the company. A business attorney will keep in check these relationships.
You also need a business attorney because laws apply to startup companies and differ based on the specifics of the situation. Even if you decide to go alone, you need to protect yourself from personal liability of business debts and obligations.
A business attorney will assist in safeguarding your startup company interests, beginning with basic zoning compliance, trademark, and copyright advice to formal startup company incorporation, liability, and lawsuits.
A business attorney will provide legal expertise in several areas about your startup company which you might not be well-versed. These include:
- Compliance: a business attorney will ensure your startup company is in adherence with federal, state and local laws
- Safeguard against risk: your business is exposed to risks, but a business attorney will put in place a set of safeguards to limit your risk
- Form agreements: a business attorney will prepare formal legal documents to govern how your startup company relates to clients and other businesses. This makes it clear what is your responsibilities to your partners, employees, clients, and their deliverables in return
- Manage liability: a business attorney will define your startup company terms of service and contract language to help manage liability in the event of a legal claim
- Manage taxes and returns: a business attorney will ensure that your startup company pays the tax it owes. A business attorney will also help lower your tax liability by looking into valid business deductions and reimbursements
For these and the following other reasons, you need a business attorney for your startup company fillings:
Incorporation
Incorporation is a legal separation of ownership between the individual entrepreneur and the business itself, to shield you from among other things, personal liability for business debts and other liabilities.
Incorporation makes your startup company an independent entity that conducts business: employs talent, enters into contracts, pays taxes, etc. The primary party to any business transaction is the entity; your startup company, and not you nor the founders themselves.
Partnership Agreement
A startup consisting of more than one founder needs a partnership agreement. This is an operating agreement stating the bylaws to govern the partnership. This will help resolve future conflicts and avoid expensive litigation.
A business attorney will establish a solid partnership agreement to govern profit-sharing, decision making, sharing of responsibilities, and how to distribute equities, among others.
Don’t wait too long to enter into partnership agreement — you want to have a strategy in place to deal with the issue when your vision differs with that of a co-founder.
Employment
A business attorney will draft an employment agreement for your startup company. He or she has the expertise to put in detail the terms and conditions governing employees’ employment.
Important considerations regarding employee agreement include confidentiality obligations, non-compete clauses, and handling of intellectual property.
A business attorney will also help with the drafting of the do’s, don’ts, conditions of employee contracts, and restrictions. A new hire status needs to be clear whether the employment is permanent or a contract.
A business attorney will help address privacy issues when hiring employees, as personal details of employees will be required such as Employer Identification Number. Also, a business attorney will carry due diligence for compliance of employees’ legal work authorization to work in the US, check for non-compete agreement with a former employer, etc.
Brand Protection
You spend a significant amount of time, energy, and resources to build and gain recognition of your startup company brand name. So, you need to protect it by registering the name as a trademark, which can be a distinctive word, phrase, symbol or design. A business attorney will help in registering a business name as a trademark, ensuring there is no conflict with another brand.
Web Content and Data Privacy
In today’s era of digital transformation, your startup company is likely to involve the use of a website, so consider implementing user agreements. This agreement governs the user code of conduct, disclaiming liability for any links to third party sites, and disclaimers of warranties by the website.
Furthermore, a startup company website will include a privacy policy that shows how the company uses, processes, stores, and shares user data. In some states, any website must display a privacy policy on its website on how personal information is collected and processed.
A business attorney will help your startup company draft these agreements and policies, and ensure there is no inaccuracy as it may result in prosecution by the Federal Trade Commission.
