Ten essential legal tips to consider with a startup at formation

Here are ten essential legal tips for startup founders.

1. Set up your legal structure early and use cheap stock to avoid tax problems.

2. Normally, go with a corporation instead of an LLC.

3. Be cautious about Delaware.

5. Make timely 83(b) elections.

6. Get technology assignments from everyone who helped develop IP.

7. Protect the IP going forward.

8. Consider provisional patent filings.

9. Set up equity incentives.

10. Fund the company incrementally.

Conclusion

These tips suggest important legal elements that founders should factor into their broader strategic planning.

As a founder, you should work closely with a good startup business lawyer to implement the steps correctly. Self-help has its place in small companies, but it almost invariably falls short when it comes to the complex setup issues associated with a startup. In this area, get a good startup business lawyer and do it right.