Many entrepreneurs dread the legal nuances of starting and running a business. Yet, understanding the legal provisions and requirements of running a business is critical to the success of your venture. Simple mistakes can cripple your new enterprise before takeoff. Working with a Daytona Beach business lawyer can help you avoid various legal pitfalls that many entrepreneurs fall into.

As a new entrepreneur, the journey to building your company is one full of lessons. Some of the lessons will come harsh and without warning, while others will manifest over time and through experience. As they say, better safe than sorry. Here are seven legal tips you should know when thinking of starting a business.

1. CONSULT A PROFESSIONAL

From the onset, one of the best decisions you can make as an entrepreneur is teaming up with a legal consultant. The advisor will help you with all the initial nitty-gritty legal requirements you may need to fulfill. From going through the lease to know your rights and obligations to explaining the different company structures you can choose, a legal advisor will prove to be an asset for your business from the start.

Working with a legal advisor can save you time and spare you a lot of stress. Moreover, you can move confidently to establish your business when you know everything you are doing is according to the law.

Ideally, you want to hire a legal advisor that has worked with entrepreneurs in the past. An experienced business attorney will know the legal pitfalls you are likely to face in your journey as an entrepreneur and advise you appropriately.

2. ORGANIZE YOUR COMPANY STRUCTURE

Unless you are coming into the game with venture capital funding, you will most likely start small. However, just because you are a one-person operation does not mean you will forever this way forever. Therefore, it is important to consider all the future elements of your company structure.

The ultimate goal of any entrepreneur is to provide value to as many customers as possible. For this to materialize, you may need to grow the company to the point where you may have to dole out shares, select a director, incorporate, and so on. All these future opportunities should be considered from a legal perspective when you are starting out on your entrepreneurial journey.

The company structure may change over time as the needs of the business change or operations scale. You may want to seek advice from an attorney about the new business realities that you may have to deal with in the existing company structure.

3. PROTECT INTELLECTUAL PROPERTY

If you are bringing innovation into your industry, it is critical to protect your ideas and creations. Here, you’ll need to understand how intellectual property (IP) law works and how you can protect your inventions.

IP not only applies to physical inventions but also designs and ideas. Sometimes, even the way that a business is run can be protected through IP law in the form of patents and other instruments. Talk with an attorney to find out how to protect your IP with trademarks, copyrights, patents, and other forms of protection.

4. GET EVERYTHING IN WRITING

In some circumstances, verbal agreements can be considered just as binding as written ones. However, attorneys recommend that you should always document anything related to the business in writing to protect your interests.

For example, if you are partnering with someone else to launch a new business, make sure you create a written business partnership agreement. This agreement should address a number of issues, including each partner’s role and responsibilities. Having everything in writing will come in handy in the event of a legal dispute in the future.

5. SHIELD BUSINESS AND PERSONAL ASSETS

Many first-time entrepreneurs opt for a sole proprietorship. However, a sole proprietorship will not offer the same level of protection as other business structures.

For example, instead of a sole proprietorship, you can start a limited liability company (LLC) to protect your assets in the event that your business is involved in a legal dispute.

Here are other ways of shielding your business and personal assets:

  • Get all the necessary licenses and certifications as required by the law. Apart from operating licenses, check whether you are required to have special licenses such as waste disposal permits, depending on the type of business you are starting.
  • Carry out a safety/risk assessment to ensure that your technology infrastructure, business operations, and workplace are compliant with best practices.
  • Purchase adequate insurance coverage for your business. Ideally, you should have general liability insurance and workers’ compensation.

You can also look at other business formations that will protect your personal assets, such as corporations. There are specific requirements that businesses must meet to be converted to formations such as an S-Corp. Talk to an attorney to determine which business structure is right for you.

6. DRAW UP CONTRACTS AND AGREEMENTS

In the course of running the business, you are likely to collaborate with a wide range of professionals. For example, you may occasionally hire independent contractors to take care of certain tasks. Therefore, you need to have air-tight proof contracts that are ready for use.

Contracts are legally binding documents that will protect both your business and the parties involved from misunderstandings. Get an attorney to draft your contracts so you know they are thorough, comprehensive, and legally enforceable.

7. BUDGET APPROPRIATELY FOR LEGAL SERVICES

When you comply with the legalities of running a business, you will significantly reduce the chances of having to deal with litigations. However, even when you follow all the rules to the tee, you may still need professional legal counsel in different matters that will arise as the business is running. Therefore, it helps to budget appropriately for legal services.

Depending on the scale of your operations, you can hire a full-time attorney or get one on a retainer. Having an attorney to guide you through the business can save you from potentially crippling litigation.