Business startup lawyers help companies navigate the complexities of developing, financing, and selling a startup business. A startup business is a newly formed venture that focuses on rapid growth and high volume distribution of its goods or services. Typically, the goal is to quickly develop the startup into a well-known business, become publically traded, or merge with a larger company. Most startups are technology-oriented, but any type of business that plans to grow quickly and distribute their products widely can be considered a startup.
Compared to a traditional small business, startups frequently have different challenges. For example, most startups do not rely on traditional business financing (such as small business loans). Instead, they actively seek capital from “angel investors” or venture capital firms. These investors weigh the startup’s costs, potential return on investment, and other factors when deciding to invest. And, most venture capital firms are hands-on with business development and expect a business exit strategy.
What Should You Consider When Starting Up a Company?
Startups require careful planning. Before founding a startup, you should:
- Create a comprehensive business plan, including an exit strategy,
- Determine which business structure (such as an LLC or S corporation) meets your needs,
- Assess your needs for business licenses, and
- Consult with a business lawyer about the myriad of state and federal regulations that impact startup businesses.
What Are Other Applicable Federal Laws and Regulations?
When founding a startup business, you must comply with many state and federal laws and regulations. Depending on your industry, you may deal with:
- Employment laws (such as wage and hour laws),
- Intellectual property, trademark, and copyright laws,
- Securities laws (concerning initial public offerings (IPO’s) and other issues),
- Environmental standards, and
- Workplace safety laws (such as OSHA and workers’ compensation laws).
It is important to understand which laws and regulations impact your business. If you fail to comply with these rules, you may face serious penalties, fines, and lawsuits.
What Kinds of Tax Procedures Do I Need to Follow?
Your tax procedures will depend greatly on your business type. Partnerships file taxes differently than most corporations. However, almost all startups must apply for an Employer Identification Number and file timely tax returns. If you need help understanding the tax implications of your business, contact an experienced lawyer or accountant for assistance.
How Can a Lawyer Help a Startup Business?
It can be difficult to understand and anticipate a startup’s legal issues without a lawyer. A lawyer (or lawyers) can ensure that you properly:
- Structure your business
- Meet licensing and regulatory expectations,
- Comply with labor and employment rules,
- Protect your ideas through patents, trademarks, and copyrights,
- Negotiate and enforce your contracts, and
- Comply with SEC regulations.
Should I Seek Legal Advice for My Startup Business?
Founding a startup is a lot of work. You’re going to put an extraordinary amount of time and effort into your company, and you should fully protect its interests. Contact a local business lawyer who has experience dealing with startups. Your lawyer can help you build a thriving business that complies with state and federal laws. And, an experienced business lawyer can ensure that your interests are protected through well-drafted contracts and intellectual property filings.