Columbus Startup Attorneys & Lawyers

What Are Corporation Pros and Cons?

Weighing corporation pros and cons is important when you start a business; deciding whether to incorporate is a big choice. Both have their advantages and disadvantage. Creating a corporation might prevent you from personal liability, while not incorporating might protect you from double taxation. Because of the impact on your business and personal life, it's important to weigh the pros and cons of forming a corporation.

Why Are Weighing Corporation Pros and Cons Important?

Weighing the pros and cons of

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Updated October 28, 2020:

What Is Carried Interest?

Carried interest, also known as carry, is a share in the profits that general partners receive in compensation for the management of a venture capital fund. These profits can be long-term gains, dividends, short-term gains, or interest and a total of 20 to 25 percent of the fund's profits. However, general partners aren't required to invest their own money. Instead, these funds are intended as motivation for a general partner that is only available at the sale of the fund.

The best way to picture carried interest is through an example. Imagine you give a friend $100 to put on roulette when they go to Vegas, and they win $200. If you agreed to a 20 percent cut for your friend, you'll pay $20 on the interest. This is how carried interest

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What is a Convertible Note?

A convertible note is a security instrument, typically used by an angel investor or a seed investor, that takes the form of a short-term loan, either secured or unsecured, to provide seed capital for a business. The convertible nature of the note allows the debt to be converted into equity in the company (typically in the form of preferred stock) at some specified future event, often in connection with the company’s valuation in a later round of funding. Convertible notes are often preferred by seed investors as a way to fund a new company while avoiding the need to value the company in its earliest stages when accurate valuation may be difficult.

Should a company fail before the note is converted, the investor’s interest in the convertible note has priority over an equity interest (st

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What is Required to Value a Company?   

To value any company requires applying one of several processes and corresponding set of procedures that will help you to determine valuation.    

What are the Most Common Processes Used in the Valuation of Companies?   

To value a company, you must determine the most suitable process to use, based on the type of business and the business’s liquidity. There are three common processes: asset-based, market-based and income-based. Here's how each one works:

1.  Asset-Based

The asset-based process places dollar values on both the company’s assets and liabilities. The basic formula for this valuation process can be stated as:

Assets – Liabilities = Company Value

Valuation factors to consider with the asset-based process inc

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Updated June 24, 2020:

A master service agreement is defined as a contract two parties enter into during a service transaction. This agreement details the expectations of both parties.

Master Service Agreement: What Is It?

A master service agreement is when two parties agree to a contract that will settle most details and expectations for both parties. It'll state what each group has to do to honor its end of the bargain. It'll also show which services apply in the master service agreement.

The goal of a master service agreement is to make the contract process faster. It also should make future contract agreements simpler. A master service agreement (MSA) is also called a service level agreement (SLA). It spells out:

• Confidentiality: The parties both agree they won't share any secrets of the company with outside parties.
• Delivery

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