Although every startup is unique, there are certain common avoidable mistakes that can lead to legal complications which jeopardize the long-term success of the business. I’m not suggesting that every startup needs a lawyer, but you should definitely pay attention, and not be afraid to consult legal counsel if any of these raise qualms for you.
Like other environments, most legal issues don’t result from fraud, but from ignorance on specific requirements, or simply never getting around to doing the things that common sense would tell you to do. Here are five of the most common examples:
1. Failure to document a founder agreement at the beginning. This oversight can lead to the so-called “forgotten founder” problem. Early co-founders often drop out of the picture due to disagreements, and you forget about them, but they don’t forget about the verbal promises you made.
To read the full, original article click on this link: Startup Professionals Musings: Five Legal Traps Every Entrepreneur Should Avoid
Author: Martin Zwilling
