Top 3 Things to know before starting your business

🚨 3 Legal Mistakes Startups Make Before Raising a Dime 🚨

I've seen it too many times: a brilliant startup with traction and buzz… but behind the scenes, the legal foundation is a mess:

1️⃣ Handshake Equity Agreements

 Startups often skip formal agreements because they "trust each other and have the same vision.” That’s great—in theory, but in most scenarios, granting equity in your company is considered a securities transaction governed by by federal AND state laws. Any grant of equity must always be done with legal compliance. Yes, it can be pricy but its an investment and insurance for the business. 

2️⃣ DIY Entity Formation

 Choosing the wrong entity (or the wrong state) can create hurdles with investors. Delaware C-corp has long been an industry standard for most VC-backed plays—yet there are many states fast becoming competitive and favorable places to organize, including Texas, with the recent passage of SB29. 

3️⃣ No IP Assignment

 If you are using developers or other persons to create and develop your company's product (intellectual property), you need to make sure that you have contracts in place (work-for-hire agreements, IP assignments) because if you dont, your company may very well not own that IP.

💡 Entrepreneurs and Founders: legal hygiene isn’t optional—it’s leverage.

 Before you form, fundraise or develop, make sure you are investing in yourself by hiring counsel as insurance for your business. Contact us today. We are always navigating complexity, delivering results.™💡

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