What to Ask: Business Operations and Startup Tips | Khai Kwan, Esq.
Starting a new business? UpCounsel attorney Khai Kwan explains what every startup should be asking their legal team about business operations and startup tips2 min read
What is the best way a small business owner can protect personal wealth and assets from business risks?
Don't open a business. get a job.
What specifically are small business owners most confused about when you first meet with them?
They are not confused, they have a problem that need fixing which they can't solve themselves like going to court.
How can quality legal services help a small business grow?
They have to be experienced in the type of small business they are advising else is a waste of time.
How can quality legal services help small businesses save money?
Reduce the paper work needed for compliance is a first step.
How can small businesses maximize the value of their legal team’s services?
Small business should focus more time on their business rather than on legal matters. the only reason I can think for them to need legal services is because at the outset they did not seek legal advice first (mostly to save a few bucks). The best solution is to find lawyers who will give them free advice from the outset. They can be friends.
Should business partners have the same amount of equity in a company? Why or why not?
Depends on the relationship of the partners, some may contribute money, some want to contribute their skills, so one need to be able to figure out who is best at what before forming a partnership. But at the end of the day, there must be a leader or captain, hence having same amount equity may be great for fairness in terms of work applied but one still need to consider controlling interest. who is better to lead the small business at the early stage.
What are the top three things a small business owner should be aware of when purchasing an existing business?
Accurately determine the value, Due diligence reviewing customer lists, sale records, advertising materials, and employee contracts, Find out if there are any human resources issues or outstanding lawsuits pending against the company.
Do you have any other essential legal guidance for startups that you haven't already included in this survey?
Make a list of things (by contract) each partner needs to commit to and delegate. Startups are about managing people/resources and that is usually where the entrepreneurs failed because it is hard to have both high IQ and EQ.