5 legal tips for entrepreneurs starting a new business
September 5th, 2023
Originally Published In The Nashville Business Journal
As an entrepreneur, it is easy to dream up a new business idea and become enthralled with it. However, before beginning your upcoming venture, it is vital to take a step back and ensure you follow the proper legal protocol. At first glance, it might look like a dreadful process, but rest assured, it isn’t as grueling as it seems, and it will alleviate the risk of legal issues and costly consequences.
Here are five legal tips to consider before you start a new business.
1. Register your business.
While it isn’t always legally required, I encourage you to register your business with the correct government authorities. Not only will this ensure your compliance with local laws and regulations, but it is a way to give your business a unique identity and has a variety of other benefits, including legitimizing your company, securing your company name for the future, protecting your personal assets and obtaining tax benefits (depending on the type of business you conduct).
Although registering your business will take time and effort, your future self will thank you.
2. Protect your intellectual property (IP).
The importance of protecting your IP cannot be stressed enough. Securing your IP is essential to grow your business while not infringing on anyone else’s rights. This will require research to ensure that your business name, logo and other elements do not already exist in the marketplace.
By safeguarding key elements of your company’s identity, protecting your IP will ultimately enhance your competitive advantage.
3. Draft thorough contracts.
This is crucial in any part of your business venture. Creating comprehensive agreements is necessary to enter a partnership or register your new business. I recommend drafting contracts for all types of agreements, so that all parties involved are in the know. This includes agreements with customers, suppliers, employees and partners.
Contracts can provide legal protection by clearly defining the responsibilities and rights of whoever is involved; they can also provide clarity in the case of a dispute or misunderstanding.
As an entrepreneur, drafting agreements can seem daunting, but your contracts must align with the specific needs of your business.
4. Comply with laws and regulations.
As you dream of your new company, the last thing you want to think about is the rules you must follow. But I highly recommend that you familiarize yourself with the laws and specific regulations established in your industry and state.
Acknowledging and comprehending tax obligations, protection regulations, employment laws and other particular codes will ensure you are compliant and can avoid legal issues down the road.
5. Seek legal counsel.
As an attorney, I believe this is the most helpful tip to give an entrepreneur beginning a new venture. To guarantee your business is set up for success, it is wise to initiate a relationship with a reliable business attorney. Not only will it save you time and money, but hiring an experienced professional can eliminate any potential legal challenges that may occur.
An attorney will be there every step of the way to provide guidance and advice, and will help navigate any challenges that come your way as your new journey launches.
As you prepare to navigate your next venture, these tips can serve as general guidelines. Remember, circumstances will vary depending on your industry and location. Seeking legal counsel can make sure you have assistance with every step; a good lawyer will personalize their efforts to fit your business best.