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30 SepMaking Sure Your Company Owns Its Social Media Presence

I’ve previously described the trouble some companies have gotten in when they utilized social media presences for their companies that were created by employees off-the-clock, by freelancers, or even by persons unconnected to the company (later acquired or endorsed by the company). When the company attempts to take control over the account and kick out […]

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26 SepIs Rule 506 General Solicitation a Bust?

A recent Forbes article pointed out that the Rule 506(c) exemption authorized by the JOBS Act has been less utilized than initially predicted. Rule 506(c) permits companies to make a general (public) solicitation of securities being sold in a private offering under Regulation D. The catch with Rule 506(c) is that all sales must be […]

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23 SepShould You Have Liquidated Damages Clauses In Your Contracts?

In all likelihood, you’ve agreed to a contract that includes a clause to the effect of “In the event of a breach by Party A, the parties agree that Party B shall be entitled to damages in the amount of $10,000”. This is what is known as a liquidated damages clause. Liquidated damages are a […]

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12 SepClosing Down Your Startup

Sometimes, entrepreneurs have to close down their company. Of course, it’s not really apparent how this is accomplished from a legal perspective — that is, how to formally close the corporation or LLC. Legally closing down a business occurs in three phases: 1) the company dissolves; 2) the company winds up its affairs; 3) the […]

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05 SepLeaving Your Job to Start a Company? Make Sure You Don’t Hit These Tripwires On the Way Out

If you’re leaving your 9-to-5 job to launch your own startup, and especially if you’re in the white-collar or tech sectors and your startup is in the same industry or uses similar technology as your current job, you will likely need to worry about employment agreements you may have signed that include restrictive covenants. Such […]

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02 SepI Have a Corporation, But What’s a “Secretary” and What Are “Minutes”?

If you have a corporation for your startup, you’ve hopefully elected or appointed officers, and one of those officers is the corporation’s secretary. It is the secretary’s job to keep the corporate records, such as the corporation’s articles of incorporation and bylaws, and to keep minutes and records of the corporation’s meetings. “Wait,” you interject, […]

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29 AugCreating and Protecting Trademarks

I’ve previously discussed many times what trademarks — which also include service marks (marks that identify a service rather than a product) and trade dress (the packaging or look of a product or service — think of the design, colors, and even uniforms, in every McDonald’s restaurant) — do. Although they are a right held […]

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26 AugAccelerator Firms Introduce New Seed Funding Structures

Two accelerator firms, 500 Startups and Y Combinator, have introduced two new structures for early-stage equity financing in the past few months. Y Combinator’s structure is called SAFE (which stands for Simple Agreement for Future Equity); 500 Startups calls their structure KISS (for keep it simple security). SAFE appears to be a form of convertible […]

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22 AugFounders’ Protections Against Dilution

I’ve had founders come to me worried about dilution of their equity stake cause by bringing on investors — although they’re more worried about keeping control than simply a bigger chunk of the company, they ask me how it’s possible to keep their same equity stake. The fact is, founders are going to get diluted. […]

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19 AugWhy You Might Need to Delete Your “Ask” Slide from Your Demo Day Pitch Deck

Two of the constant fixtures of the junction between startups and private equity have been the “demo day”, and the securities registration exemption of Rule 506 under Regulation D. The demo day has frequently been a way for entrepreneurs to introduce their ventures to the world, as well as, to one extent or another, make […]

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