Your Start-Up Legal Checklist
One of the very first things a prospective entrepreneur learns is that a start-up is not all about the vision and an exciting business model.
There are many very mundane but essential elements that go into the process of launching a business.
There are 7 basic areas that have to be addressed, with many details in each of the 7 business functions that include strategic, corporate, marketing, product, operations, administration and finance.
One priority that flows through each of the seven is the need to pay appropriate attention to the relevant legal issues.
It is an unfortunate reality that we live and do business in a highly litigious environment. Beyond the protective aspect of proper legal planning, it is simply prudent business to keep the legal ducks in line.
It helps with communications and eliminates many problems found in start-ups that don’t take the time to get things clear and on paper. It is vital to get competent help with employment law matters.
Every start-up of any size needs a good small business lawyer on the team. Not just any lawyer will do. Choose someone who understands the special needs of start-ups and growing small businesses.
That individual can then help choose specialists that you need, such as intellectual property lawyers.
The legal documents and issues can seem daunting. A logical and step-by-step process will eliminate most of the intimidation process. Done correctly, the legal costs are also controllable.
The following are a few of the items on the checklist that many small business start-ups will address in the launch and growth phases.
Strategic
– Non-disclosure and non-circumvention agreements
Corporate
– Legal structure, incorporation documents, board minutes
– Management and consulting agreements
Marketing
– Sales, rep and agent agreements
– Licensing agreements
Product
– Intellectual property agreements and licenses (Patents, copyrights, trademarks)
– Manufacturing and licensing agreements
– Vendor agreements
Operations
– Equipment leases and maintenance agreements
– Web domain and hosting agreements
Administration
– Real Estate leases, contracts
– Office equipment leases and maintenance agreements
– Insurance and bonding
– Personnel agreements, employment contracts, policies and procedures
– Review of all compliance and regulatory requirements
– Licenses, permits and other certifications.
Finance
– Banking and loan agreements
– Financing documents, placement memorandum, subscription agreement, disclosure documents
– Stock options and incentives
This is not, of course, the only legal documents that small businesses encounter. Depending on the nature of the business, a number of other documents and agreements are utilized. The reality is that many contracts and agreements are boiler plate.
As your experience grows, you will readily grasp certain concepts and terms that are a part of most legal documents.
That does not mean it is good practice to sign any legal documents without a thorough understanding of the contents. Nonetheless, over time, you will gain the ability to focus on the key elements that affect specific agreement.
The importance of proper legal counsel during the start-up phase cannot be overstated. This is especially the case if any money is raised from investors.
Very strict legal requirements govern that process. With a little patience and time, the legal side of your business will be a help to you, and not a burden.
