We don’t always take the time to priorities before launching a project, but if you’re opening a brand new business – it’s certainly time to tap the brakes and put things into perspective first! So here are 10 quick tips about startup law!
1. Start At Square One for Startup Law Site
Before you head off searching for a commercial space to let, or schedule interviews with website developers, you need a name that works for your business. It’s a multi-step process, and involves more than just the combination of a clever set of words.
For marketing clarity, your company name should essentially ‘say what you do.’ If you are too literal, the name will probably have been scooped up years ago (as in Body Builder), along with the corresponding website domain. Ideally, the business name will include your main service as well as part of your name or location; such as Chelsea Body Building. Unless you already have a notable name, using it for the business will normally result in high advertising costs to explain your service or product.
Next, you must verify the name isn’t already in use in the Uk, as you will eventually be registering the company and its ownership. Third, take a look through a trusted domain registration site, and be sure a matching (ideally) domain name or a reasonable adaptation of your chosen name is available. Opt for a .com or .co.uk rather than a .net or ‘vanity’ domain, because they have stronger credibility with the search engines.
2. Build Your Framework
Next, you’ll want to make a decision about the type of business structure that fits just right with your specific situation. Are you thinking Sole Trader, or should you form a regular or Limited Partnership? Maybe you’ll want an entity with further protection of your personal assets, such as a Limited Liability Partnership or a Limited Company?
Do you know the features of each structure, and the limitations? You can definitely research the choices available – and even register your business structure online – but if you do so without first speaking with selected lawyers for your startup, you’ll be missing the nuances and experience that come along with their assistance. This mistake is one of the most common, and it can make things unravel pretty quickly when problems surface.
Imagine trying to learn a foreign language solely by reading books in that tongue, without having a conversation with a fluent speaker. We experience this every day; people from other countries speaking our language in broken sentences, missing meanings because they’ve only learned the literal interpretations. Obviously, when it comes to the language of startup law, the average person is way out of their comfort zone.
3. Be Open to Suggestions
Speak to others in your profession or industry; easily found at network meetups or online forums. You’ll find they tend to be very open to sharing their experiences and recommendations. Keep your eye out for potential mentors, as many entrepreneurs credit theirs for helping them through rocky situations.
Consider the many business incubators and accelerators, as well as government grant programmes currently existing in the UK. They may provide everything from shared work spaces to expert startup law, advice and education – and even funding assistance or introductions.
4. Protect Your Innovations
This is another area where consulting a solicitor is highly advised. When it comes to ensuring your intellectual property (trademark, patents, brand) are safeguarded, it would certainly be short-sighted not to spend the money up front to properly protect these assets.
Just because you advertise your services, or publish a news release, it doesn’t give you proprietary rights of ownership. Another factor of importance is to make sure you don’t spend your personal capital developing a concept that another person has already patented. That would not only be disheartening, but could be financially devastating.
5. Restrain Social Media
Many crimes targeting a company’s data begin with hackers using the Internet to track your employees. Social media channels, and their corresponding profiles, can become a much bigger risk than you or your staff might imagine.
Drawing a line in the sand, between your company and the social outreach of your employees, might be an action you want to look into. Use of an intranet protocol (sharing information within the firm) allows internal password protection as well. Create procedures and policies to prevent defamation, bullying and other misconduct and keep your antivirus software up to date.
6. Put Everything in Writing
Sure, the handshake is a friendly and noble form of agreement. The problem is, not everyone remembers the terms in the same way – or one person’s perception may imply something that wasn’t understood by the other.
Contracts are indisputably the most important document in any business. Intentions and acknowledgement of the parties are necessary ingredients, and should be clearly set out in a manner everyone understands. From customer agreements to employment contracts, and commercial leases to shareholder agreements, legal documents help your business stay lawful and on track.
7. Seek Professional Advice
Keeping adequate and forthright records of sales, expenses and filing annual tax returns is, of course, necessary to stay in business. It’s also wise to consult with a licenced accountant, who can help you set up a system that’s easy to use and allows you to head in the right direction for the best success.
If your company is large enough to retain an in-house lawyer then that’s all the better, but either way you’ll want to form a trusted relationship with a solicitor from the onset. Find startup lawyers UK-based if this is where you plan to launch your new business. There are many advantages to be had when you have one local advisor or firm driving all the legal aspects of your company.
8. Don’t be Penny-Wise and Pound Foolish
Saving money is, of course, desirable all around. However, when you fail to spend money in your company’s best interest then it’s not only foolish, it can ultimately cost you more in the long run. It’s always better to hedge your bets (by being over protective) rather than assuming it will all ‘work out in the end.’
Whether the expense is to obtain further testing on a product before going to market, or having a contract reviewed before signing – reaching a little further down into your pocket could be a business decision with long-term impact. And, a good result is going to be worth the effort.
9. Avoid Throwing Good Money after Bad
And, while we’re on the subject of money matters, we don’t want you to waste yours either. One way to quickly have your funds disappear is entering into relationships (with vendors or even solicitors) that are open-ended.
You should always know what you’re committing to, and the cost breakdowns of everything you purchase – and that includes commercial leases, as well as professional assistance like accountancy and even lawyers. Any expert worth their salt should have no issue with giving you fixed rates for common specific tasks, and a clear schedule of expenses you will incur.
10. When You’re Busy – Hire Some Help!
Many entrepreneurs, particularly Sole Traders, are capable of monumental achievements. That said, they may also have some trouble delegating. After all, when the money is rolling in, it’s tough to watch it go right back out; especially when they are capable of completing the task themselves (given there are enough hours in the day).
The problem is that doing everything by yourself will break you eventually. Whether you crash and burn from sheer exhaustion, or you miss out on opportunities because they were bigger than you could handle alone – you need to reach out for help when it’s time. If you have more work than you can finish during a reasonable work week, take the leap and bring in support!