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What are the most common legal mistakes made by startup companies?

On Behalf of | Apr 9, 2021 | Business Law

Some North Dakota entrepreneurs who are launching a new venture make a lot of legal mistakes that can backfire at a later time. There’s a significant amount of work required to start a company, and many people fail to track their expenses by keeping receipts for tax returns. Failing to protect your intellectual property to prevent other parties from claiming the rights to your designs and ideas is a common issue as well.

A lack of proper licenses can also affect your ability to function as a business without violating local and state regulations. It is important to obtain the right authorization in order to avoid significant fines and other penalties.

How to make your startup successful

When you have a startup business, you’re likely aware of how it can quickly fail in the first few years. According to statistics, approximately 50 percent of startup companies fail in the first five years. You can avoid being one of them by getting an understanding of the operating costs. Knowing how much money it can take to operate your business will reduce the risk of filing for bankruptcy or getting into too much debt to keep it running. You should also have the necessary skills to run the business, and you should have conducted a market analysis well in advance of the launch date.

Who can you contact for legal assistance?

If you want to protect your business and avoid legal mistakes, contact an attorney who has business law experience to guide you through the process. The attorney can inform you of your obligations and help you to complete the organizational documents correctly before they are submitted. Once the company has been formed, an attorney can assist with contract preparation and review and provide advice and counsel on regulatory compliance.

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