Launching a start up can sometimes be a difficult task. You do not have to address financial aspects only but maintaining a legal structure is crucial. It is important for the founders to secure their legal basis in order to avoid unwanted ramifications in the future. This is a common mistake that many founders make when initiating their startup. Consulting competent lawyers is essential to ensure future protection. It is good to have knowledge about legal documents that one must need to launch their own start up. Here are some legal documents that you will need:
Employment contracts and offers
Your business will need employees. Hiring employees without any specific contract can be dangerous in the long term. It can lead to liabilities costing you huge deal of money that no business would want. Creating an employment contract is necessary to formalize your hiring process that too in a legalized manner. The employment contract must contain relevant terms and conditions like length of employment, rate of payments, benefits employee will receive, retirement policies, duties to be performed under contract and much more. You can draft the contract according to your business’ criteria.
Articles of incorporation
Putting up a proper business structure is essentially important. There are many ways in which you can launch your start up. Sole proprietorship can result into massive legal liabilities for which the founder is going to be primarily responsible. There other options like forming a C corporation or a limited liability company. Each structure has its own pros and cons. You can assess the objectives and demands of you start up and go for the right structure. But make sure the method of incorporation is followed in a legitimate manner.
IP assignment agreement
Potential investors often look into the IP assignment agreement. This document is instrumental in attracting new external investments. This can be extremely significant for IT companies. Start up founders must have ownership of all intellectual property assets to avoid claims in future regarding imitation of business model. There are two different kinds of IP agreements: Technology Assignment Agreement and Invention Assignment Agreement.
If you want your start up to be launched with fewer complications and technicalities involved, then you must ensure drafting effective and strong bylaws. These are internal rules of the company that will govern the operations. It will settle disputes and determine the rights and powers of the people involved in company. There are several aspects involved when it comes to bylaws. Make sure the legal team drafting bylaws must be a strong one.
If your company is getting funds from private investors, it is time to draft shareholder agreements to avoid unwanted circumstances. These documents will define the rights and duties of shareholders and by which means they will be able to exercise their rights. There are many other important things involved in the agreements which can prove to be essentially crucial to your start up’s initial success.