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Starting a business is part of the American
Dream. It is what makes this country great. Our office structures
many different types of transactions and works closely with clients to build a
business with a solid foundation and to grow the business in a stable and
reliable manner. Starting a business throughout the United States
is quite easy. Here a some issues to think about:
- Remember that there are three
governmental jurisdictions: the Federal Government, each applicable
state government (e.g., the State of Pennsylvania) and each applicable local
government (e.g., the Municipality/Township of XYZ). Each of these
governments will regulate your business in some manner. We call these
the BIG 3G. Generally, each of the BIG 3G generally will tax
your business. These taxes have different names and forms. But,
remember, "BIG 3G."
- Okay, having said that, the first thing to
think about is the product or service. There is no reason to
start a business if the product or service is not in demand. Now,
remember, "good ideas are a dime a dozen." A business is a commercial
entity. The idea must be commercialized; that is, placed into commerce
and sold ultimately for a profit. Mistake #1: Loving your idea.
It has been said that "where love begins, wisdom ends." So be it.
Loving your idea can impassion you to proceed, but it does not necessarily guide you.
We will be glad if you privately love your idea, but think that others will
hate your idea. That keeps you thinking. It makes you sell, it
makes you strategize. Acting like you love your idea drives the
failure that results from the misconception that you just need to do some
little act and everyone will beat down your door to buy it. To think
that way is to have the commercialization plan called, "I am really lucky."
Planning to be lucky is really bad business and will not impress investors.
- Next, think about you. Not
everyone can be an entrepreneur. It is hard. Moreover, rarely
does any one person have the qualities, time or overall resourcefulness to
do it all. Do you have the
Vision, Knowledge,
Courage and Tenacity to make it happen? If so, great.
Otherwise, you need to put together a team that can supply the personal
resources that you need. Remember, to have others supply
resourcefulness and talent, will cost you, often money and/or part of the
business, but 50% of something is better than 100% of nothing! It has
been said that you need to "give your children roots and wings." Same thing
with commercialization of ideas. Sometimes you need to let your
inventions, as proverbial children, go to school and grow up. It can
hurt, you lose some control, but it is part of the commercialization
life-cycle. Always stay open-minded to options for resource teaming.
- Okay, if you have the right product and
you're the right person or you have the right team, then you need to think
about the commercialization vehicle. Initially, that may mean choosing the form of business entity.
See our publication on
this issue. For more structured scenarios, often to accommodate
investors, consider establishing a corporate family of
parent/subsidiary/sibling company relationships; this allows you to
encapsulate business, legal and other operational issues in separate
entities.
- Once you have the the organizational
foundation laid, you need to think about the relationships you need to form,
and the contracts surrounding those relationships. For example,
partnering agreements, shareholder agreements, client agreements, etc.
Remember, never do business with someone you do not trust, because even the
best contract will not remove the appurtenant problems, but, with someone
you do trust, have a detailed written contract to avoid and to resolve
misunderstandings.
- Protect your intellectual properties, such
as your
copyrights, trademarks, trade secrets and patents.
- Pick the right attorneys. Attorneys
are advisors. The job of an attorney is to advise you. In
business law, you need attorneys who know and understand business.
But, even so, your attorneys should not be telling you how to run your
business, but advising you of possibilities and probabilities of legal
problems as it relates to business implementations. Quite frankly, we
have clients that have proceeded with business transactions amidst great
risk, but have been extremely successful. Our best clients will work
with us to develop business plans to minimize risk and maximize reward, and
after developing the strategy and potential implementation, assess the
situation and proceed in their best business judgment. All deals have
risks, you need an attorney who can clearly explain the resultant risks and
help you resolve to a firm conclusion and plan.
Contact us for more information:
Z e g a r e l l i
Home Page (click here)
Zegarelli Law Group
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Upper St. Clair Administrative and Postal Office:
2585 Washington Road, Suite 134
• Summerfield Commons Office Park
Pittsburgh, PA
15241-2565 USA
Pittsburgh Office:
301 Grant Street, Suite 4300 • One Oxford Centre
Pittsburgh, PA 15219-1407 USA
Voice: 412.833.0600
Fax: 412.833.0601
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