An Oath to Startups

In case you missed it, we had Mark Stansbury of Stansbury Law give us an hour of his very valuable time to answer all our legal questions about startups. Some of the key takeaways were:

• Have the important talks/arguments with co-founders sooner rather than later
• So no one walks away with a chunk of the company in the first few months, the industry standard is becoming 6 years for equity vested which means equity is released to owners over time
• The biggest mistake startups made is not getting professional advice early on, in particular, legalzoom is good for basic agreements but can lead to problems down the line
• If you don’t have a lot of money, do accounting and legal on your own, even if you are audited you’ll probably be okay because the IRS knows you don’t have a lot of money
• The biggest trouble companies get into is not paying withholding tax, always pay any sales or withholding tax, even if lights go out and business goes down, if you don’t pay that the IRS will come after you and won’t settle
• Make sure you’re not signing bad terms when you take capital, be wary of money from the government, there are often strings attached that are not conducive to business
• RocketLawyer is a good resource for cheap legal help, competitor of Legal Zoom
• Brad Feld is a good resource, follow his blog

We are tremendously grateful for Mark’s time taking the stand and all his great advice! If you would like to contact him, he can be reached at mark@stansburylegal.com. He has offered to give a free hour of basic advice to help move you in the right direction if you need it!

HEY THERE! I'm the VP of Communications for the Business Builder's Club. Feel free to communicate with me anytime!

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