Anaheim Startup Attorneys & Lawyers

Updated June 25, 2020:

It takes money to turn a great idea into a great product, but “money doesn’t grow on trees” and you may not have thousands of dollars just waiting to be spent.  So how do you turn your dream into a reality?  Here are some of the best options.  

Self-Funding / Bootstrapping

Many entrepreneurs start with some level of self-funding (also known as bootstrapping) and, in fact, future investors likely will want to see that you have some “skin in the game”.  Even if you can only put in a little money, it is worth considering the benefits. For example, you don't have to worry about keeping investors happy. You also can keep more profits to yourself.  Many founders also hold off on taking a salary, consider tapping into the 401(k) retirement account, and/or have a side job to help make ends meet while they get their business up and running.

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Accelerator Programs: What Are They?

Accelerator programs, also known as seed accelerators, help companies learn how to run their business by providing mentoring, education, and financing. Mentors are provided to help entrepreneurs navigate the competitive and sometimes confusing start-up world and may even help with funding. The programs usually last for relatively short period of time (e.g., a few months) where the aim is to teach the participant several years’ worth of experiences and information in order to accelerate the timeline for success. The program typically ends with a public pitch event where business owners can present their ideas to potential investors. Accelerators generally ask for a small piece of the company in return.

Accelerators are similar to business incubators with some distinctions -- for example, incubators generally focus on growing an idea while accelerators generally

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What are Incentive Stock Options?

Incentive stock options (ISOs) are a type of stock option typically given to key employees or management to purchase stock in the company and can result in a better tax treatment.

Incentive Stock Options vs. Nonqualified Stock Options

Other options that may be available to employees who are not considered key employees or upper management may be eligible for nonqualified stock options or NSOs.

Unlike NSOs, an ISO would be treated favorably for tax purposes. When an ISO is exercised, the employee need not claim the income. When they sell the stock, the gains are taxed as ordinary income rates rather than at capital gains rates. It is important to be aware that the tax benefits are

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Choosing the right structure for your business is one of the most important steps you will take in your company’s journey. The right structure will protect you from liability, ensure maximum tax advantages, and position you for success. The first question is whether to incorporate your business at all.  This decision requires, at a minimum, a basic understanding of the advantages and disadvantages of corporations.

What are the Different Types of Corporations?

There are two primary types of corporations:

• General Corporations, or “C” Corporations, is the most common

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