As an entrepreneur who has just taken off with a dream venture, startup growth is bound to be your top priority. You will want to stabilize your business early with the right steps at the right time. Arranging funds will be on top of your checklist, while you will also want to go the extra mile to secure the top talent in the industry. There is much more on a typical startup checklist, such as market research, product launch and promotional strategies, customer experiences management, and compliance.
With such a lot of work at hand, it is easy for entrepreneurs to overlook the legal aspects of running the startup. But it is the worst you can do because going slack with legal protection can land your business in deep trouble. It becomes all the more vital at the initial stage because the assurance of being on the right side of the law lets you focus only on growth. Let us highlight the value of legal protection for new businesses.
Good relationships with founders are vital
Most entrepreneurs cannot embark on the journey alone. It makes sense to collaborate with co-founders and partners to share risks and get support at the early stage. You also need to ensure good relationships with partners so that they stick with you for the long haul. Even if they want to part ways, they must do it amicably. Legal advice about founder contracts and agreements keeps your business in a safe place. The right language and clauses in the contract prevent misunderstandings and disputes with partners down the line.
Protection of intellectual property is essential
New businesses often sell unique ideas and products, which need to be copyrighted. You will also want to protect your brand logo and marketing collateral from infringement. Protection of intellectual property is not a choice for startups because losing it can take away your competitive advantage. Fortunately, the apt legal steps can help you safeguard these assets from competitors. Trademarks, patents, and copyrights protect your branding assets. You can go the extra mile with non-disclosure agreements with employees and contractors and confidentiality contracts with third parties.
Lawsuits can happen to any business
Another reason to prioritize legal protection at this stage is that the last thing you will want to encounter is a lawsuit. It can be expensive and cause reputational damage. Unfortunately, lawsuits can happen to any business these days. Slips and falls are common on business premises, while you may also come across a defective or dangerous product lawsuit. The risk runs high if you let your employees drive company vehicles. They may have an accident with a pedestrian or another driver and injure them. The victim can seek help from personal injury attorneys to file a massive compensation claim against your company. It is best to have legal guidance from an expert to handle such lawsuits or even avoid them through settlements.
Employee disputes can be a hassle
Startups need to steer clear of employee disputes too, but it is easier said than done. Multiple issues can cause a problem with your workforce. However, it is possible to secure your business against employee lawsuits if you have proper employment contracts at the time of hiring. Ensure that they have clauses related to leaves, appraisal, and termination so that there are no chances of disputes later. Also, cover contingencies like workplace injuries, occupational safety, and office harassment to stay on the right side of the law. Proper provisions for the employees will also enhance your reputation as an employer and boost employee retention in the long run.
Client disputes need to be handled
When you lack real-world business experiences, it is easy to get into trouble with contract disputes with clients, suppliers, and vendors. You may even face lawsuits without an intentional mistake or due to sheer lack of awareness. Clients may sue you for delays in delivery, while vendors and suppliers can bring claims for missed payments and deadlines. A focus on legal protection with clear and comprehensive contracts can provide significant coverage from such lawsuits. It is best to have your contracts drafted and checked by legal experts before you sign them.
Entrepreneurs need to focus on legal protection for their new business. While you must pay attention to other aspects of running the company, ignoring contracts and legal loopholes isn’t the right approach. Hiring a lawyer to handle these matters gives you peace of mind because they will have the right advice to safeguard your business from lawsuits in the first place. Even if someone files a suit, your lawyer will represent you and fight it out.