Setting up a business can be complicated and, unless you’re an expert, it’s easy to make mistakes that can have serious and long-lasting implications. Seeking expert legal advice can help you avoid the many legal issues that can derail a new business. At Scott Bailey, we have extensive experience supporting startups and offer a range of services designed to help your business thrive, from our purpose-built affordable startup packages to bespoke services like protecting your intellectual property. If you’re unsure whether it’s worth investing in a startup lawyer, here are three common legal issues for startups it will help you avoid.
Intellectual Property (IP) Infringement
Most startups rely heavily on their IP without even realising it. If your business is built on a unique product, brand or idea and you fail to protect it from infringement, you can run into issues further down the line. Additionally, if you plan to seek investment, any prospective investor will likely require proof that your IP is protected.
To safeguard your business’s IP, you must identify any intellectual property you own and then take suitable steps to protect it, whether using patents, trade marks, copyright, or design rights. If you’re unsure of what IP you own, don’t worry. All our startup packages include an initial consultation, during which one of our experienced startup lawyers will provide you with expert guidance on any IP you need to protect. Our highly skilled intellectual property solicitors can then work with you to implement an IP strategy, ensuring your business is protected.
Having a solid IP strategy in place puts you in a strong legal position should any company try to copy your great ideas. In 2014, Lush Cosmetics brought a case against Amazon for infringing its trade mark. Despite their comparatively small size, Lush Cosmetics was successful. This case demonstrates how effective a good IP strategy can be and highlights the importance of taking steps to protect your own.
Disputes between co-founders
If you’re launching your startup with a business partner or investor, it’s essential that all parties are clear on their roles, responsibilities, and equity stakes, as well as the direction your business is going in. If this isn’t the case, disputes can arise quickly, threatening the success of your startup.
If you’ve watched The Social Network (and if you’re an entrepreneur, you probably have), you’ll be familiar with the story of Facebook’s co-founders, the Winklevoss twins. In a case that was settled outside of court, the Winklevoss twins alleged that their former business partner, Mark Zuckerburg, had stolen the idea for the social networking site. This cautionary tale provides an excellent example of why watertight legal agreements with your business partners are essential. So, if you’re launching your business with a partner or investor, don’t be a Winklevoss, get a co-founder agreement in place.
Without watertight contracts in place, any agreements you make with your customers, suppliers or partners may not be enforceable. Misunderstandings or miss communications can lead to legal disputes, which have the potential to hamper the success of your business. For example, if you commence work for a customer without a valid contract in place, you might struggle to enforce the terms of your agreement if they refused to pay.
The easiest way to avoid legal issues is to seek proper legal advice at the outset. At Scott Bailey, our team of expert startup lawyers has extensive experience supporting entrepreneurs as they launch their businesses. Contact us today to find out how our startup packages and legal services can give your business the best possible start.