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7 Reasons Why All New Businesses Need An Attorney

Starting a business invokes a spectrum of emotions, you are likely anxious and excited about the prospect of starting and growing a successful business. Perhaps the most unexciting part of starting your new business is dealing with the legal issues involved in setting up a business. Hiring an attorney will allow you to focus on the fun stuff, your product or service, which is undoubtedly what excites you about your new prospect. Below are seven reasons to hire an attorney when you start your business.  
  1. Business Formation
 Choosing an entity type is one of the first steps in starting a business. In most states you will have a variety of entity types to choose from. Two of the most common entities you have likely heard about are a limited liability company (LLC) and a corporation. Your entity choice has both liability and tax implications so you should make that choice intentionally and with the advice and assistance of a business attorney. If you choose the wrong entity type, you can change it, but not without unnecessary expense, which is why you should consult an attorney at the beginning stages of starting your business.  
  1. Websites
 Although it is tempting to “copy and paste” a Terms of Use/Terms and Conditions or a Privacy Policy from another company’s website, it is not in the best interest of your business to do that for several reasons: 1) it is likely an illegal copyright infringement; 2) you have no idea if that company’s policies are any good, maybe that company did a “copy and paste” ; 3) that company’s policies might not fit your business; and 4) although much of the language may be boilerplate, certain policies are very specific to your business’ practices and uses and should be reflected accurately in your Terms of Use/Terms of Service and Privacy Policy.  
  1. Contracts
 For the same reasons you should not “copy and paste” another company’s Terms of Use/Terms and Conditions or a Privacy Policy, your customer/client agreement should be tailored to your business. An experienced attorney can draft a custom agreement that protects your business from the risks and liabilities that are particular to your business and/or industry. A great attorney will teach you how to use your custom customer/client agreement and will help you change or update it as necessary based on changes in your business and the law.  
  1. Vendor Agreements
 Most small business work with different vendors, some of which are much larger, established businesses. Before you sign a vendor agreement, you should ask your attorney to review the agreement, as these agreements are undoubtedly protective of the vendor’s business and not your business. If the vendor agreement is negotiable, your attorney can negotiate fair, mutual protections. If the vendor agreement is nonnegotiable, your attorney can advise you about the risks and potential issues that could arise, and, ultimately, whether you should sign the agreement.  
  1. Intellectual Property Protection
 A trademark protects the specific and unique name, logo, and/or symbols pertaining to your products or business brand. A registered trademark provides greater brand protection than “common law” protection that applies when you have an unregistered trademark. It is important to work with any attorney who can help you to ensure your intended trademark is available and to file the application. Two of the most important reasons why you should hire an attorney to submit your trademark application are: 1) an attorney will conduct an invaluable, comprehensive trademark search to identify any potential conflicts or competitors prior to filing your application and 2) an attorney will help you evaluate the goods or services you plan to offer under your trademark to carefully craft the goods or services description for your application. These two aspects of your trademark application are often determinative on whether your application is successful.  
  1. Hiring
 A big question most new and small business owners have is whether to hire employees or independent contractors. There is an important legal distinction between the two that requires you to create a very different relationship with your employee than independent contractors. In order to avoid the classification you want to avoid, you need to understand the differences and your obligations under each. An attorney can help you make the decision that’s best for your business and comply with all obligations based on that decision.  
  1. Raising Capital
 When it’s time to raise money, you will want to make sure you have your legal ducks in a row. Investors will want to see that you have chosen the most appropriate entity and you have all the necessary contracts in place to protect your business (their investment), which includes all the considerations above. Raising money can be complicated and investors can take advantage of inexperienced entrepreneurs. Before signing any terms, you should have your attorney review or draft your agreements.

 Basecamp Legal offers a range of legal services for new and growing companies. We will help you make the important, early legal decisions so you hit the ground running. As you grow, we will help you with your day-to-day legal needs so you can focus on your business. We help companies throughout Colorado, California, Idaho, Washington, and Wyoming. You can learn more about our business services here

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