Business & Non Profit
"After all, the chief business of the American people is business"
- President Calvin Coolidge
So, you want to start a business, but what kind of business structure should you have? Should you not do anything? (a solo proprietorship). Should you incorporate - perhaps a C-Corp, or an S-Corp? Or maybe create a partnership or multi member LLC?
A good lawyer can walk you through the differences, the risks and advantages of each structure, and how it can impact your bottom line, especially if you have partners. More importantly, how you structure the business, will be absolutely crucial if you have partners.
For instance, can one partner leave, or only if all the other partners agree? Who in the business actually owns the intellectual property, the one who came up with the idea, or all the partners? What if an outside investor offers to buyout one partner but not the others? Are you the partner who provided the starting capital for your mutual enterprise? Maybe you want to get paid back some before everyone else takes a profit?
These can be complicated questions, involving not only your lawyer but also your accountant. Either way, someone needs to walk all the partners through each of many important questions. When your lawyer is done, you should have an agreement you all understand, that will prevent future conflicts between you all. Starting a business is difficult enough - but the worst thing is failing because everyone was not on the same page in terms of assumptions and expectations of who should own or get what. Don't you think?
Non Profits on the other hand present unique challenges. Most Board Members are volunteers but don't realize they are held to fairly high standards of making decisions in a reasonable manner. Further, Board Members need to be extremely careful not to accidentally misuse nonprofit money or engage in any conduct that is an actual or even *seeming* conflict of interest. Good counsel can prepare good policies for your nonprofit and better yet, train the board to avoid issues.