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Top Legal Mistakes Early-Stage Businesses Make
Entrepreneurs have drive and ambition, which are the building blocks of success and are necessary to move their ventures forward. Some business owners also have training, such as an MBA, while others have experience, a killer business instinct, or a combination of all of these. What most business owners do not have is legal knowledge and expertise (although, of course, some business owners are former attorneys, and vice versa). Yet business and law often collide, and for some businesses, not paying enough attention to legal issues can lead to costly legal mistakes. This is especially true for busy early-stage entrepreneurs. Even if you are aware of the top legal mistakes early-stage businesses make, an experienced Fort Lauderdale, FL business law attorney can offer priceless advice and help you navigate the path forward.
What Are the Top Legal Mistakes Startups Make?
Skipping Written Agreements
In the flurry of dealmaking, agreements are sometimes reached over a glass of scotch or a quick lunch. Do not be tempted to rely on the handshake deal, much as you may have a good relationship with the other party. Having written agreements in place is a must not only for sealing the deal but also ensuring that all of the terms necessary to protect your business are in place.
Forgetting About Intellectual Property Protection
A company’s intellectual property is one of its most valuable assets, but it often takes mindful action to ensure that it is protected. This can be true whether that needs to happen in employment and independent contractor agreements, or by making the proper patent applications domestically and internationally. This can be particularly important if your business is technology-oriented.
Waiting to Set Up Legal Compliance
Businesses are subject to regulation, from employment law to taxation to corporate law via the Securities and Exchange Commission (SEC). This means that a business should be aware from day one of the laws with which it must comply, and put in place best practices to do so. Otherwise, it risks liability in both private and public litigation.
Not Incorporating Early
Incorporation often equals legal protection. Incorporating your business as a limited liability company or corporation shields the startup’s individual players from legal and financial liability for most company actions. While this protection is not infinite and there are typically exceptions, incorporating tends to shield personal assets.
Call a Fort Lauderdale, FL Business Law Attorney
They say knowing is half the battle. At The Elliot Legal Group, P.A., attorney Gavin Elliot knows Florida business law and can provide advice to early-stage companies on the most pressing legal questions that come up in a day-to-day business context. If your startup needs experienced Oakland Park, FL business law representation, you can speak to our law firm at 754-332-2101.
