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27 FebSplitting Equity Among Co-Founders

One of the first big questions that co-founders have with each other is how to split the founders’ equity. Many teams simply decide to quickly move past the questions by deciding to split the equity evenly. However, myself and most commentators believe that this is usually the wrong decision. Splitting the equity evenly means that […]

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24 FebThe Costs of Starting a Business

If you’re thinking about starting your own business, you must be mindful of the costs of starting up a business. The first category of costs are the incorporation and licensing costs. Most startups are formed as either corporations or LLCs, both of which carry filing fees in order to register with the state. startups who […]

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17 FebDo I Have to Pay Workers When We’re Closed for Weather?

Startups and small businesses in the Greater Boston area have been repeatedly faced this winter with the prospect of closing down and/or asking their employees not to come into work. However, founders and managers may not be sure of whether they have to pay their employees when the company closes for winter storms. Employees who […]

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13 FebWhich State Should I Incorporate In?

The question of which state an entrepreneur should incorporate or organize his or her business in is an important, if sometimes overlooked, question. Some startup founders simply choose the state in which they live; others choose Delaware without considering why Delaware is a preferable choice and whether the benefits of Delaware are even applicable to […]

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10 FebMassachusetts Adopts State Crowdfunding Exemption

Last week, the Massachusetts Securities Division adopted an equity crowdfunding exemption to the securities registration requirement under Massachusetts law, effective immediately. The new rule, 950 CMR 14.402(B)(13)(o), is an emergency regulation adopted by the Securities Division without legislative activity, is available to a business entity that (1) is formed under Massachusetts law, (2) is authorized […]

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03 FebEquity Does Not Equal Wages

Many early-stage startups lack the cash to be able to pay wages to their workers, and so the founders decide to part with equity instead in order to compensate these workers. However, by doing so, startups can run afoul of the wage laws in their states. For example, minimum wage in Massachusetts effective January 1, […]

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23 Jan114th Congress Tries Again To Pass Startup Act

At the start of the 114th Congress, a bi-partisan group of sponsors have reintroduced the Startup Act, a bill that has been kicking around Congress several times over the past four years. The bill has languished during previous attempts to pass it, but the bill’s primary sponsors, Sens. Mark Warner (D-VA) and Jerry Moran (R-KS), […]

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20 JanHow Startups Fail to Protect Their IP

Startups sometimes make lots of mistakes with using or protecting their intellectual property. Oftentimes such mistakes boil down to a failure to appreciate of what intellectual property is or how to protect it. The first IP mistake entrepreneurs can make is using intellectual property from their current employer (or former employer if you’ve moved on […]

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16 JanWhen Should a Startup Set Up Its Employee Equity Option Pool?

Many founders wonder when they need to plan out how much of the equity will be made available to compensate the key employees of the company — this is the process of creating or setting aside an “option pool”. The best time to do this is at the beginning of the company, when it is […]

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13 JanRule 144 — How Restricted Securities Are Sold

This week I guest-authored another article over at CrowdExpert, which you can read here. The article discusses Rule 144, which is one the primary mechanisms by which restricted securities — securities sold in private offering transactions such as Rule 506 are restricted from being resold — are resold, and have enabled the rise of “secondary […]

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