You understand what it means to take a risk as an entrepreneur.What you’ll discover:
1. Why is keeping company records important?
2. As a small company owner, what are my chances of being sued?
3. What will happen if I am sued?
4. May I manage my company with personal assets?
5. What should I think about before hiring investors?
6. What characteristics make a firm a pleasant place to work?
7. How can I safeguard my company’s name?
8. What happens if my company expands quickly or abruptly fails?
9. How can I ensure that my company is in compliance?
10. How do I make long-term plans for my family?
Most entrepreneurs find it very satisfying to build a company around their passion. But, there are certain legal elements of establishing a corporation that may be both irritating and confounding. After all, you’re the owner of a small company, not a legal expert. When you establish and build your firm, you’ll need to negotiate corporate compliance concerns, intellectual property laws, taxes, regulations, corporation responsibility, and a slew of other legal difficulties. How do you know where to begin with so much to learn? It’s great to see a lawyer for guidance on your specific business requirements, but it also helps to know what topics to bring up with your lawyer.
These are some questions you may not know to ask to help you start the discussion. Make some notes since the answers to these questions are critical to the success of your firm.
Table of Contents
1. Why is keeping company records important?
Small firms must keep a variety of receipts and documents for tax and corporate compliance requirements. Certain papers, depending on the nature of your firm, may assist restrict your responsibility in the case of a lawsuit. Also, some of the other documentation created by your company will be quite useful later on since it will help you to examine the development of your company and the effectiveness of your operations. As a consequence, it’s critical to consult with your attorney about the kind of records and other papers you should save as part of your company operations. It is much simpler to retain the appropriate records from the start than it is to attempt to locate or recreate them afterwards.
2. As a small company owner, what are my chances of being sued?
Every commercial effort carries some danger of legal action. But, what those hazards are is not always evident. Of course, some firms are more vulnerable to lawsuit than others (for example, running a skydiving business is obviously going to be riskier than working as a freelance blogger). Moreover, litigation might emerge in a variety of circumstances. Small firms may face litigation from current or former workers, charges of trademark infringement, and/or disagreements over the purchase or sale of products or services (to name just a few possibilities). The first step in preventing a lawsuit is identifying where you are most vulnerable and then taking efforts to reduce or eliminate that vulnerability. Unless you’re a lawyer, you should definitely seek the assistance of a lawyer to determine such obligations.
3. What will happen if I am sued?
Even if you do everything correctly, there is still a potential that your company may face a lawsuit at some point.
In general, if your firm takes off, you’re at a larger risk. The more staff you have, the more customers/clients you have, and the more activities you participate in, the more likely your company may be sued. If you’ve never been sued before, you may be unsure how to react to a complaint or threatened lawsuit. As a result, you should consult with an attorney to develop a strategy for dealing with litigation before they occur.
4. May I manage my company with personal assets?
The barrier between personal and work life is readily blurred for many small company entrepreneurs. After all, your company is a combination of your passion, pastime, and profession. Despite this difficulty, it is critical to maintain your professional and personal assets distinct. Even apparently benign behaviors, such as purchasing office equipment using your personal credit card, might jeopardize the personal assets on which you and your family rely. Similarly, if you consider your personal and company assets to be interchangeable, why shouldn’t a creditor or a court? Your attorney can advise you on the best strategies to transfer assets to and from your company.
5. What should I think about before hiring investors?
If your company has the potential to develop, you may be able to take capital from outside investors. For some firms, investors are the only option to expand. Investors may contribute case studies, contacts, and important information to tiny enterprises. But, taking on investors should not be handled lightly. Most investors will not lend you money out of the goodness of their hearts. There will be conditions tied to the money you will get, and it is critical that you understand how this will affect your company and the freedoms you have as the owner.
6. What characteristics make a firm a pleasant place to work?
Most workers, believe it or not, want more than simply a solid wage and a stable position. Workers thrive when they are given liberty, respect, and breathing space. Nevertheless, as crucial as being a good boss is, effective employee relations start with recruiting. When bringing on new team members, it’s critical to collaborate with your attorney to develop best practices. This involves, but is not limited to, developing firm HR policies, preparing the necessary documentation (such as independent contractor and employment agreements, non-disclosure agreements, termination letters, and so on), and ensuring that you follow through with every employee, every time. A lawyer is the greatest resource for putting up a thorough strategy to acquire and retain top personnel since what you require depends on the sort of worker you want to employ and the type of firm.
7. How can I safeguard my company’s name?
Whatever your company’s nature, its reputation is almost definitely its most important asset. As a result, you’ll want to safeguard your brand against imitators and rivals. An attorney may assist you with registering trademarks for your company’s brand name, logo, and other distinguishing features, as well as handling any potential infringements on your brand.
8. What happens if my company expands quickly or abruptly fails?
There is no such thing as a sure thing in business. Your company may surprise you with unexpected growth, or it may slip and fail unexpectedly. As a result, it is prudent to prepare for any possibility. An attorney may assist your company in achieving a mix of flexibility and protection. For example, when you file your incorporation documents, you want to arrange your company such that it may adapt and grow in unexpected ways.
9. How can I ensure that my company is in compliance?
Every firm and sector must comply with a plethora of municipal, state, and federal rules. Noncompliance with these regulations may result in fines, penalties, company responsibility, and even personal culpability. So, how do you figure out what those regulations are and which ones relate to your company? It might be tough to ensure that you haven’t overlooked a key legislation or rule unless you’ve done this previously. The regulations that apply to your company will differ based on the entity type you’ve selected, the state in which you’ve incorporated, and the location(s) where you do business. As a consequence, it’s critical to contact with a skilled specialist to ensure your company is in compliance.
10. How do I make long-term plans for my family?
Many small business owners want to one day pass on their company or its assets to their children. But, depending on the structure of your company (and your family), this may not be as simple as you think. An estate planning attorney may assist you in ensuring that your company is secured and can be handed down to your family.