To ensure that you avoid the negative repercussions of an avoidable mistake, there are a few

common legal issues you should be aware of:

1. Non-Disclosure agreements.

It seems like a given – don’t talk about anything that is considered “top secret.” But, it isn’t that
obvious to everyone and to some, it just isn’t a priority or even a concern…

Particularly those outside of your business who might become involved with you in some way.

Anyone who interacts with your business – from the business side, not your clients – should sign
a non-disclosure agreement (NDA) to ensure they won’t run and share your ideas with the
competition.

2. Future of the business.

Life happens. Unfortunately, sometimes people leave this world too soon. If that is the case,
what will happen to your business?

It is important to invest in a will kit to ensure the assets of your business are protected and have a
designated owner should you become unavailable.

Have your attorney send your will kit to the post office for easy pickup.

3. Vesting.

Finding the right co-founder for your business is quite the task…

Who do you trust? Who will make a good fit and lead your business in the right direction?

It is important that you have a similar work ethic and timelines for investment – you need to have
chemistry.

Instead of getting all your shares at once, once option to consider is vesting. Your equity can be
vested over time so that if you don’t have the chemistry you thought you did, there is a fair
solution.

4. Intellectual property.
While your business is still small, it is hard to imagine that you could potentially face the issue of
people infringing on your intellectual property assets (or vice versa)…

But, it can happen easier than you think.

It is worth the investment of both time and money to get your trademarks, copyrights, patents
and trade secrets legally registered. It will be a lifesaver if, or when, an issue arises.

5. Trademarks.

You just thought choosing a business name was difficult…

But, did you consider that even as creative as you might have been, someone else might still
have thought of it first?

Invest in performing a killer search to ensure your business name is not already another
company’s trademark.

6. Compliance.

There are corporate compliance laws in place that affect companies in various industries. The
laws that apply specifically to your business will vary based on the type of business entity you
are, the state you do business in, and several other determining factors.

Do some research, and consult the help of an attorney, to ensure you know what documents
should be generated and maintained by your business to remain compliant.

7. Business structure.

There are several different business structures…

Partnerships, S corporations, corporations, sole proprietorship and a limited liability company.

All business structures hold very different meanings and offer a variety of different benefits. You
should consider if your business is going to remain privately funded, if you plan on taking on
investors, and what type of growth you expect your company to have in the future.

You’ve already put in all the leg work to get your business up and running, don’t let a simple –
and costly – legal mistake cause you to lose it all.