When a person or set persons start a new business venture, it is an exciting time when you just want to get to work already. I call this the “honeymoon stage” of business. Everyone is collaborating well, ideas are flowing smoothly and depending on your personality, you either start the work immediately because you are motivated and eager, or you take a step back to analyze and consider what needs to get done first. It is all a happy period of time where you can’t wait to move forward and grow. No one likes to consider the bad stuff that may come about later such as legal problems. Be wise, be that person that does consider such issues to prevent them.
If you have not yet started your business, take a peek at the following recommended points to brainstorm and consider before and after choosing a business name and registering a domain name. If you have started your business and are already growing it, take a moment and review some points that still require your consideration. These points usually stir up legal problems between businesses at some point in their life cycles if not considered properly.
1. Business Plan. Business plans are roadmaps for a successful business. It generally outlines the route a company needs to take to grow its revenues and profits. If you have time, develop a business plan – even if it is simple – so that you have a living document to refer to. As you carry on your business, the plans may change, but that is somewhat expected. These are helpful to keep you grounded and focused on your goals. It also serves as a great tool to measure performance per quarter or year.
2. Business Entity. Consider whether you are going to operate as a sole proprietor or a corporation/LLC. Each one of these options offers different liability shelters and tax benefits that are worth exploring. Besides performing general online searches about these topics, you best help yourself by seeking a consultation with a business attorney to really help you understand how each option would fit you. Sole proprietorship, corporations, and limited liability companies (LLC’s) are used for different business needs. Analyze your immediate and long-term needs under each business type. Business entity planning is of even greater importance when dealing with 2 or more business partners. More often then not, partnership issues develop – even with family-owned businesses – where improper planning and document preparation was not in place. Review Buy-Sell Agreements, Shareholder Agreements, and other similar options available to adequately establish your 2+ person business relationships.
3. Business Names. Business names are fun to develop. A business can be named just about whatever it is you want and can be as creative or simple as you desire. However, note that you do not find two companies called “Coca-Cola” or “Pepsi Cola” for a reason. Trademark protections, copyright protections, domain name protections, and state laws exist to limit what you can name our business. As a basic example, if you want to be the next big App developer, you know your space is in the computer and information technology field. You won’t want to use a business name and slogan that is already in commercial use in that same technology field because if you do, it will be a matter of a trademark infringement lawsuit coming your way. Therefore, when doing something as simple as selecting a business name, be sure to perform your due diligence and determine whether anyone else is using that same name at a City, County, State, and Federal level. Also determine whether they’re using the exact or similar name in your industry.
4. Domain Name Registrations. Before registering for a domain name, perform your due diligence in this step as well by looking for other domains and businesses (both domestically and internationally) already registered. Under business laws, trademark laws, and copyright laws, certain domain names may infringe on an existing business’s rights the minute the domain name becomes registered. Avoid a trademark infringement claim when choosing a domain name. As a simplified explanation of the standard, if the new domain name causes confusion to the public between the new domain and an existing domain, it is likely an infringing domain. To avoid infringement issues, search the United States Patent & Trademark Office’s website for registered marks, potentially conflicting marks and marks which can cause general confusion.
6. Online Agreements. Do you know the difference between “browser wrap” and “click wrap?” These are two ways in which an online website visitor agrees to an agreement on your website.
7. Monitoring and Enforcement. Once you register your business name and/or trademark name you then have to monitor for infringement. Unless you enforce your rights to your business name and domain, you may wind up diluting the value of your business and losing your rights.
The above summarizes some points to review before and after moving forward with a new business. However, there are many other points to consider both during and after these stages. A lot of points are purely based on the type of business you plan. Business attorneys experienced in helping sole proprietors and business partners in different industries can be beneficial to you. Consider a consultation for representation with these initial matters. Business attorneys can also help you in the long run with various business transactions. See more and request a consultation.