One of the myths about creating or running a new business is that all you need is a good idea. Sure, that helps — but the logistics of actually operating the company after that “good idea” is realized is just as important. Your idea could be the next Facebook or Twitter, in theory. But if you don’t follow the rules; implement the right strategies and plans; and prepare yourself for the legal rigors of running a business, your company may turn into the next MySpace.
So, for the many entrepreneurs in the Rochester area, heed this advice. First of all, you want to have an owner’s agreement. This document can help prevent an understanding you and your fellow partners have being scrapped due to changing priorities or life events. Having an agreement can decrease the chance of a good business being derailed before it even gets going.
Along the same lines, you want to get deals and agreements in writing when you are managing your business. Taking people at their word is a nice idea — but in the real world, that virtue can really hurt a company. A deal that you are counting on (and interpreted many weeks earlier as being “good to go”) may not have been received in the same way as your supposed-partners. Getting that in writing protects you and takes the guess work out of running a business.
Furthermore on contracts, your contracts must be well written and properly drafted. If they lack clarity or if they do not hold up legally, then you could be in real trouble. When you are considering creating contracts and drafting legal documents, it behooves you to have an experienced business lawyer by your side to help out.
Source: bizjournals.com, “18 legal mistakes business owners make that can cripple their companies,” David G. Bates, Dec. 16, 2013