Establishing a strong legal structure is crucial for startup founders during the early growth of their business. Often, you’re so eager to get things going, that you forget to safeguard the one thing you’ve been working on for so long. What’s the first thing you can do to protect your business from patent trolls, ownership claims or disloyal employees? Sign documents that outline rights, duties, and relationships between all the parties involved. Make sure your business is legally protected right from the start.
Earlier, we discussed Richard Branson’s tips for starting a successful tech startup. Here, we’ll focus on basic legal forms you should marshal first off to avoid any legal issues and secure your company’s future. Time is a precious resource for any startup, and the good news is that you can fill out and e-sign all these forms online all by yourself from any device.
Intellectual property assignment agreement
This is a key legal document that investors look for when deciding whether to fund you.
An assignment agreement transfers the rights to the intellectual property from the creator to another entity. Employees sign the document to assign to the company any ideas, work products, or inventions related to the company business.
Secure complete ownership of all intellectual property assets. Avoid costly patent claims and companies trying to copy your business model.
Bylaw
Bylaws set forth the rights and powers of the stockholders, directors and officers.
Establish how to settle disputes, select leadership and outline the rights and powers of shareholders. Bylaws also institute voting thresholds for approvals to certain actions by the corporation, like electing new board members or entering into debt.
Non-disclosure agreement
This document safeguards your founder and employees’ ideas and your intellectual property.
A non-disclosure agreement is a legally binding arrangement between two parties. One or both parties classify confidential information and prohibit the other party from disclosing shared information.
Make sure the agreement is detailed and says exactly what proprietary information will be shared. Otherwise, you might risk losing valuable work to a competitor and cause major setbacks in making your company a success.
Employee contracts and agreements
An employment agreement is a legal contract between an employee and your organization. This legal document is key to ensuring employees understand what’s expected of them.
Shareholder agreement
A shareholder agreement outlines rights, obligations, and relationships between shareholders. Also, it regulates daily operations and formalizes processes to follow when an investor leaves the company or new investors buy-in.
Yet, this is a complicated agreement and you should always consult an attorney to help you draw it up.
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