One of the most important people you can have when developing a new business is an attorney. Certainly, the entire focus of this website has been and will continue to be on business planning needs but having an attorney by your side will ensure that you are operating within the letter of the law as you develop your business and as you progress through your business operations. An attorney is especially important if you are raising capital from the private investor or a number of angel investors.
Foremost, these types of activities can fall within the realm of securities laws. As such, an attorney can assist you in determining whether or not your capital raising activities need to be examined by a state and the federal regulatory agencies overseeing the sale of securities. There are a number of safe harbor rules and other regulations allow for the sale of private securities without having to go through an extensive registration process, but only an attorney is qualified to make that determination on your behalf. Most business attorneys are able to properly examine these issues and provide you with qualified legal advice as it relates to your capital raising operations. In some cases, and as we have discussed throughout this website, you may need a private placement memorandum in order to ensure that investors understand all the risks that are associated with providing capital to your business.
Beyond the startup phases of your business, an attorney can assist you with ongoing legal questions that may arise as you conduct revenue generating activities. This is especially true if you operate within a heavily regulated industries such as finance, healthcare, telecommunications, or specialized online based businesses. Your attorney will be an invaluable source of information as well as it relates to general business operations. Most lawyers have extensive training in regards to thinking strategically, and they can not only provide you legal advice but business advice as well. Of course, billable hours by lawyers are very expensive she may want to keep these down to a minimum but they can be very helpful if you are formulating a new strategy as it relates to providing a new product in the market.
Often, your attorney will work very closely with your certified public accountant to make sure that your business operations fall completely within the letter of the law only from an operating perspective but also from a financial perspective as well. Some entrepreneurs opt to hire a tax attorney who can provide them with both advice regarding the general operations of business coupled with insights as it relates to the company’s financial operations. Most tax attorneys are very expensive, and only large-scale small business were medium-size corporation typically retains a tax attorney on an ongoing basis. On an ongoing basis, we are going to discuss the professionals that you’re going to need to hire not only during the start of phases of your business but also as you progress through expanding and developing her operations.
As it relates to startup functions, your attorney can assist you not only in developing a business plan but also developing the operating agreement that may be required if you are starting a limited liability company. Most attorneys also will provide services as it relates to registering a corporation or a limited liability company. In some cases, your attorney’s office can also double as a registered agent. However, make sure your attorney provide the service before you list their address as the service of process address on any incorporation forms that you are producing.
In closing, your attorney can be a great ally as it relates to the development and expansion of your business on an ongoing basis. You can estimate that on a yearly basis attorneys fees will generally run about 4% of the revenues generated by your company. However, for certain smaller businesses feel advice may just be needed on the incidental basis but it is always good to have an attorney on retainer in case an important matter needs to be discussed.