Insider knowledge of the arcane legalities involved in starting one’s own business can be vital to your enterprise getting off the ground without a hitch. Budding entrepreneurs and established business owners alike cannot ignore certain legal aspects of operating a small business–as much as they may wish they could. The consequences of ignoring the finer legal matters of running your business are almost always far more costly than any perceived savings of inaction.
Your business lawyer will be there to keep everything conforming to the letter of the law. The most vital areas are:
Establishing a business structure. Before you get too deep into the day-to-day operations of your business, wouldn’t it be nice to know that the foundation of your business is one well-suited to your needs? You can save time and money just by making an informed decision and deciding on the right one from the get-go, instead of creating a pre-organization liability period or undergoing a costly reorganization into a better suited entity structure. Examine the character of your business and seek out the advice of an attorney to put the proper protections in place–not least of which is ensuring your personal assets are secure against any potential financial liability from the business.
Building a support network. Throughout your career, you’ve likely picked up a few mentors along the way–perhaps a boss, a professor, or even just a knowledgeable friend. The value of such people is far greater than simple moral support; they offer perspectives on your business outside your personal area of expertise. Their input on the financial, legal, or marketing side of things can serve to catalyze the growth of your business. Don’t let those connections languish as your paths diverge, maintain the relationships and also seek out new persons of value.
Financing the enterprise. No matter the option you choose for financing your business, the strict separation of your business accounts from your personal finances is utterly imperative. I’ve had too many good, hardworking business owners come to me after they’ve lost everything to not emphasize this point. Disastrous legal consequences can ensue from the improper mixing of accounts, including letting your personal assets be forfeited in a business lawsuit. Don’t let this put you off your dreams, but be sure to seek out all the options for funding your business and make sure you are doing it in a way that keeps your personal assets protected. Come to us to discuss the different paths forward–there may be more than you think!
Putting it all to paper. Each and every business agreement you make had better be set in writing, whether it’s the lease to your office or an employment agreement. Spelling it all out not only helps define the relationship between the two parties, but guards against legal disputes as well. Don’t look at a contract as another of the endless terms of service agreements for software that most people blindly agree to or some generic boilerplate agreement. To avoid overlooking this vital step in growing your business, put in the time to review and approve agreements and have them custom tailored to your situation. It’ll save you a real headache later. If you bring it to me, I can help with the fine print.
If you’re a small or mid-size business owner, call us today at (612) 206-3701 or fill out our contact form to schedule a business consultation session.
Image courtesy of Ryan/CC BY-SA