The first conversation you’ll want to consult with a legal advisor is about your business entity. You will need to decide whether you will be an LLC, S-Corp, or Partnership. Should you decide to enter into a partnership, you need a legal agreement that will decide what percentage of ownership will go to each partner, how the company will operate and how things will be handled if one partner requests to be bought out of the business or dies, and what happens if the business needs to be dissolved. My lawyer friend Nina Kaufman calls this “The Entrepreneur’s Prenup”. Invest in professional legal counsel, there’s no such thing as a handshake agreement.
You will also need a lawyer to draft the boilerplate contract that you will use with your customers to engage services, any employment agreements and your non-compete and non-disclosure agreements that all hires, even part-time and freelancers should sign.
Your legal advisor will also help you determine whether you will need to secure patents, trademarks, or copyrights on your logo, slogan, systems, written materials or products. Your attorney should review any contracts you are asked to sign, especially any contracts with fortune 500 companies or any loan documents.
When hiring a lawyer, you want someone who has experience with small businesses, but you also want to make sure that your legal advisor is responsive and has time for you.
You should feel comfortable with your lawyer and not intimidated. Look for experts who are smart, collaborative, informative, and, most of all, will listen to you. I also like to look for vendors who can help get you more business. If you go with a lawyer from a large law firm, you may not get the one-on-one attention you may need as a start-up business, and you are guaranteed to get a big bill. The cost may be more than is necessary to create your initial contract template.
Look for a specialist: If you have a matter that involves purchasing a business or buying into a franchise, I would look for a lawyer who specializes in franchise agreements.
Ask for referrals from other business owners: You can also consult with your local small business development center. Many of them have partnerships with the local bar association to offer pro-bono advice to start-up businesses.
Interview candidates: When selecting an attorney, interview at least three candidates, ask them for small business references, and make sure that you check them. If you choose well, chances are you’ll have the same lawyer for the life of your small business.
Check them out: Make sure that the attorney is licensed and admitted to practice before the courts in your state. The state bar records will also inform you if the attorney has ever been reprimanded or involved in any illegal activity. You can check the attorney’s credentials on the state bar’s website or use www.martindale.com.
“Business Man Signing Contract” courtesy of tungphoto / www.freedigitalphotos.net