The 9 Frequently legal errors in Startups

Startup

 

What are the most common legal mistakes when riding your startup entrepreneurs?


The most frequent errors, without establishing an order of importance or frequency, with which we are, are as follows:

1.- Lack of professional legal advice: Often, entrepreneurs write contracts or agreements partners on models “downloaded” Internet: This can have very serious consequences and does not help at all when you need the entry of investors in your business.

2.- No investigate the investor: Often entrepreneurs do not carefully check to the people sitting at the table to negotiate: You need to check the reputation of investors and the people with whom you work. In a way, "We got married" with investors when in the company. Surely many readers spend more time with his project with partners. So you better ask other entrepreneurs who have had relationship with investors to know who "we get home".

3.- Improvable labor contracts: It is common the existence of verbal employment contracts, or written in an extremely simple way. In any hiring of a startup is recommended at least make clear two subjects: agreements confidentiality and ownership of inventions because these are within the scope of the employment contract. The lack of clauses specifying these points can lead to serious problems in the future. In this entry, I commented on these situations.

4.- Industrial Property: In relation to the previous point, Industrial Property of an invention may belong to the company he was working entrepreneur. You should check that has not been incurred in this situation. For many startups, industrial property is their most valuable asset and a dispute over the same could leave "empty" enterprise content. Once verified that there is no such problems, should adequately protect such intellectual property. And the protection of industrial property, It goes far beyond entering the website of the "OEPM" and register a trademark.
Moreover, for investors wanting to get into your business, exploitation of industrial property shall be a right of society and different from one partner as an individual.

5.- Company Type: We have found cases where entrepreneurs are reluctant to mount a limited company, and function as a civil society or community property: In these situations, partners personally liable with all its assets: A problem in the enterprise can cost you dearly.

6.- Lack of a Covenant Partner: After the "honeymoon" of partners, discrepancies arise and is a partner wants to leave or exclusion is necessary: The absence of a pact partners to facilitate these processes often make the business end closing.

7.- Enterprise Control: Regarding the pact partners, you are missing the establishment of control clauses delimiting the founders regarding major decisions in the company: Indebtedness of importance for the asset, issuance of new shares, or situations to buy or sell shares.

8.- Negotiating without the right equipment: Negotiating the entry of investors, required to form a strong team among entrepreneurs and skilled attorney in the matter. It is convenient to use a lawyer friend who engages in such, family law that has no experience or appropriate knowledge. Negotiate without an experienced attorney is put into a disadvantage. All the experts investors have.

9.- Liability of directors: Increasingly, there are situations in which managers can be held personally liable (with all its present and future assets) despite having made a capital. For example, in the event of a bankruptcy without having deposited the annual accounts.

There are other legal errors incurred many startups, but we will comment on other posts.

 

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