When starting a new business, the first wave of questions from entrepreneurs usually revolves around the selection of an appropriate business entity. The decision to even establish an entity—and which one to choose—is a complex issue. Owners often seek guidance due to the numerous opinions they encounter, especially in the brainstorming phase. Often opinions of friends, family and colleagues can differ. This is where my expertise comes in handy; and this book aims to provide actionable insights on these topics.
Intellectual property (IP) protection emerges as another pressing concern. Many new businesses have a special idea, logo, method, or similar that they feel is important to protect. Something that differentiates them from other businesses in the same industry – their secret sauce so to speak. When intellectual property protection is considered by those who are not familiar with it, there is a lot of wording and concepts that are circulated that can be confusing. For example, some clients mistake thinking they need a patent for what they really could use a trademark or copyright to protect.
Contractual protection is a third critical area where new business owners need help. Many times, a new client is in the midst of purchasing an established business and they are dealing with the ins and outs of legal agreements involved in buying and selling.
In the state of California, where my practice is based, liability associated with human resources poses the greatest risk to business owners. Employers should arm themselves with comprehensive knowledge of their responsibilities, especially when they start hiring employees. Ignorance can be costly, leading to personal liability.
The four foundation discussions —entity types, IP protection, employment matters and contracts are the topics most queries related to starting a new business are concentrated.
What To Consider When Starting A Business
Apart from HR concerns, selecting the right entity type is a crucial decision closely linked to the financial aspects of your business, like taxes and cash flow. Contracts and intellectual property protection round off the list of top considerations.
The Benefits Of Engaging A Firm Early On
The investment made in a new venture isn’t just financial—it’s also an investment in the future. Legal fees shouldn’t consume your entire budget, but allocating some funds for sound legal counsel is a wise move. Before you lock yourself into leases or other commitments, it’s crucial to clarify the entity type that’s best suited for your business. This is where Hudson Martin PC, or any experienced law firm, can add immense value.
For instance, if you’ve personally signed a lease, you waive the liability protection a corporation would have afforded you. Likewise, if employment laws are not strictly followed, you risk severe legal repercussions, particularly in California.
What Our Firm Can Do For You That DIY Solutions Can’t
The market is flooded with DIY legal solutions for establishing entities or filing for trademarks. What these platforms lack is the personalized consultation that comes from years of experience in guiding businesses at various growth stages. For example, while an LLC might sound attractive, it may not be ideal for businesses with active income due to extra tax implications.
We often step in to correct mistakes made via online formations; accountants are our primary referral source for this reason. In one instance, we helped a bakery transition from an LLC to an S-corp, saving them $750,000 in extra taxes. The example underscores the indispensable value we offer—insight and tailored advice that prevents costly mistakes.
By choosing professional legal services over DIY solutions, you’re not just buying peace of mind; you’re investing in the long-term viability and profitability of your business.
For more information on Creating Your Own Business In California, an initial consultation is your next best step. Get the information and legal answers you are seeking by calling (831) 480-6608 today.