Corporate Lawyers For Newly Formed Startups: Why Do You Need One?

Some people who decide to build their own companies have adequate resources to get started. But, they don’t know that new businesses sink because they fail to consider the legal implications of their decisions.

Typically, starting up a business involves some legalities that you should be aware of from the beginning. However, unless you’re an experienced lawyer yourself, you need someone who can take a look at your new firm’s legal framework. Besides, having a lawyer by your side can prove beneficial in operating a startup company.

Below are some reasons why you need corporate lawyers for your newly-formed startup: 

1. To Help You Choose Your Startup’s Business Structure  

As a startup, you need to make some decisions about your corporation’s structure. In most cases, having the proper business form is crucial. It helps outline your company’s legal responsibilities and possible liabilities. When you choose the wrong structure for your corporation, it may result in some financial troubles. This could even make it liable for the obligations of your employees or partners.

Because of this, hiring legal professionals, like corporate lawyers Toronto or wherever you may be, can be an excellent idea. They can help you decide on which business structure is most suitable for your newly-formed startup. For instance, they can assess the circumstances of your company and decide which of the following corporation sizes is perfect for your situation:

• C-Corp: A standard corporation form that’s a distinct and separate entity from the owners. Generally, owners can’t be personally liable for the business’s debts. However, there are exemptions. Some examples are when the owner injures a third party, or treats the corporation as an extension of themselves. Another exemption is if the owner participates in fraud that results in a business loss, and many more.
• Limited Liability Corporation (LLC): A corporation structure wherein the owners don’t have personal liability over the company’s liabilities.
• S-Corp: A business structure that has limited liability protection. It means that the owners aren’t personally liable for the legal claims against the corporation.

2. To Draft And Review Contracts For You  

Before operating your startup corporation, it’s essential for contracts to be signed by your clients, suppliers, and other key players of your company. A business contract refers to a legally binding agreement. It specifies the rights and responsibilities of the parties involved. It’s crucial to the relationships among shareholders, clients, partners, and many more. Without it, any conflict or dispute may not be resolved easily and quickly.

Hence, if you need help with your business contracts, working with a corporate lawyer can be the best thing. They can draft and review these documents for you to protect your company’s rights and interests. For example, they can examine the contract’s provisions to see if any loophole can result in significant financial losses for your company.

3. To Protect Your Intellectual Property 

It’s important to safeguard your intellectual property for a startup like yours. Since your business is pretty new, you need to protect it. This includes your logo, trademarks, taglines, inventions, and much more. This way, you can ensure no competitor will use them without incurring some legal consequences.

However, unless you’re an expert in intellectual property laws in your state, you’ll need the services of a corporate lawyer to protect your company’s own intellectual properties. They have adequate knowledge that can help register and trademark everything for your business.

4. To Handle Lawsuits 

Like other companies, startup corporations may also face lawsuits. These can arise from shareholder disputes, breach of contract cases, or employment disputes. However, dealing with these legal troubles can be complicated and overwhelming. When you don’t handle them properly, it may cost your company a considerable amount of money. Not to mention possibly ruining your business reputation.

Hence, if you don’t want lawsuits to affect your startup’s chances of success, it’s best to seek legal help from a reliable lawyer. They’re familiar with all the procedures and processes involved, making it easier to navigate a lawsuit. Also, if you have a case under trial, a legal professional can represent you in court. They take care of all the work while focusing on your business’s core aspects. These can include preparing the paperwork, collecting evidence, and many others.

Bottom Line   

Launching a startup corporation requires a lot of legal work to be successful. When these things aren’t dealt with properly, they can lead to some adverse consequences in the future. As a result, you may be unable to turn your startup into a thriving company.

Therefore, to make sure your corporation has a robust legal foundation, it’s best to work with a corporation lawyer from start to finish. By keeping the information mentioned above, you’ll better understand the reasons why you should seek legal help for your newly-formed business.