Hiring a lawyer will help make sure your business is legal and prepared for success.
If you’re starting a business, it’s important to hire a lawyer as soon as possible.
An experienced business law attorney will understand the legal requirements of starting a business in your state and provide you the necessary paperwork needed to get started. If you decide to start your business without a lawyer, you may face legal difficulties later.
Today, we’re taking a closer look at some of the reasons a business lawyer will help you set up your business for success.
Let’s take a look …
1. A Lawyer Will Set You Up for Success
You want your business to succeed, right?
Like all entrepreneurs, you’re more than aware of the time and effort it takes to build a business from the ground up.
That’s why you have to do everything you can to ensure your business not only survives the years to come. Hiring a business lawyer is just one step that positions your business for success. There’s no telling what types of challenges you and your business will face during your venture, which is why it’s extremely important to prepare for the worst.
What types of challenges?
Businesses face a wide variety of challenges, including financial, creative, and legal.
Taking the steps needed to prepare for those challenges will ensure you’re ready for them if they should arise. For example, you may need to reorganize your financial set up through bankruptcy, make a compromise with a business partner, or defend your business from legal claims.
Hiring a lawyer before these challenges arise will help you nip them in the bud.
2. Connect With Investors
Lawyers work with a lot of people.
Some may even able and willing to introduce you to some of their connections in a way that benefits your business.
In addition to minimizing risk, an attorney can help you maximize value. A good lawyer can tell you about special tax benefits of one type of incorporation vs. another type. He can advise you on capital gain taxes.
A good business lawyer can introduce you to angel investors and venture capital sources based on previous experience with them. Having a network of proven financial backers can be essential in getting off to a strong start with funding and high valuation.
3. Correct Mistakes Before They Cause Problems
In their haste to get to market and establish their startup, many entrepreneurs don’t think about potential legal issues or think they can be addressed later. But this thinking fails to consider that “later” might mean “more expensive.”
For example, founding a startup as an LLC and later changing it to a Delaware C corporation would be more expensive than choosing the right type and filling out the right forms from the beginning.
4. Avoid Legal Problems Early
Many small business owners do not consider legal assistance until something bad happens, like being sued. There has been a case of sexual harassment or wrongful termination or some other issue that has led to litigation. It’s better to have an attorney advise you on corporate employee rights in the workplace before trouble occurs.
5. Protect Your Interests
A lot of startup founders don’t understand all the legal requirements of beginning and running a business. If you are setting up an LLC in New York, for example, you are required to announce it through newspaper notices. These could be costly from a media standpoint but even more costly if you fail to follow legal requirements. A good lawyer, especially one who knows your state laws, can keep you informed of what you need to know and do to minimize risks.
6. File the Required Paperwork
A business lawyer can help you build and maintain good relationships with your customers, clients, partners, and suppliers by creating the appropriate communications vehicles. If you are asked to sign agreements and contracts with others, a lawyer can review them for you and keep you out of trouble.
It’s also a good idea to have a standard contract yourself to make it easier to hire, fire and compensate employees, recruit board members and advisors.
7. Tax Advice
It’s a good idea to have a business lawyer or tax lawyer be on hand to make sure you are following regulatory tax laws for a startup business. The lawyer will help you set up a tax structure and required licenses and advise you on the tax implications of various business investments and other deals you are considering.
8. Protect Intellectual Property
Your product may be new to the market and may be unique.
You may be in a creative field like design. In either case, your individual rights to your ideas can be at risk if not protected. A trademark, patent or copyright lawyer can help with intellectual property issues.
Whether you’re developing intellectual property now or plan to later, it will benefit your business to hire an intellectual property lawyer to ensure your work is protected.
9. Raise Funds
Inexperienced entrepreneurs can take on unnecessary or unusual liabilities and dilute or spread equity too much. Before signing any terms, it’s a good idea to have a lawyer advise you on the soundness of the agreements you make. You can avoid traps from investors who want to take advantage of you.
10. Prepare Your Company for Investigation
It is possible that a company founder can get into legal trouble to the extent that the federal government starts an investigation. Issues can stem from IRS filings or financing laws or securities questions, or any of a dozen more possibilities. A business transactional lawyer has the experience to help you with the legal maze you will face.