Connecticut entrepreneurs, especially those involved in a tech start-up, often don’t think they need lawyers when starting their businesses. Unfortunately, even in the tech space, such an attitude toward attorneys exists. The problem usually is that they don’t understand the benefits of having an attorney. Furthermore, many business people believe that they only need lawyers when they get into disputes.
However, this belief is wrong. The aversion towards lawyers eventually makes tech start-ups run into issues after kicking off. When they finally call a lawyer, their business may already have suffered great hits. Therefore, tech start-ups should work with Connecticut business lawyers right from the business conception. An excellent lawyer’s guidance can shield them from legal mistakes start-ups make.
5 Advantages of Lawyers to Connecticut Tech Startups
There’s a lot that an intending tech CEO can benefit from hiring a business lawyer. You can read some of them below.
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Choosing the Right Type of Company
Tech start-ups usually start as companies. However, there are many types of companies. For instance, there are corporations and partnerships. Whatever company type a young tech start-up chooses will significantly impact the business. For example, this decision will affect tax liabilities and corporate governance structures.
That’s why the best professionals to advise Connecticut start-ups on this issue are lawyers. An excellent attorney can listen to your business idea and determine the right company for you. In doing this, they’ll consider your goals, vision for the business, and even your financial status.
Furthermore, they’ll advise you on the merits and demerits of each company type. Consequently, you can then make an informed decision when registering the company.
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To Draw Up Non-Compete and Non-Disclosure Agreements
Many of the founding members of tech companies eventually leave for other companies. However, while they are with the first start-up, they will come across important business information. If they ultimately disclose these facts to another business, it’ll put their former company at a disadvantage.
Similarly, if they start their own tech business with the same knowledge, they’ll make a tough competition. Therefore, it’s crucial to know whether you require non-compete and non-disclosure agreements. A non-compete contract restricts a former employee’s ability to compete with their previous employer.
On the other hand, the NDA prevents such former workers from disclosing any privileged information. Fortunately, an attorney can identify which of your staff are in sensitive positions requiring such contracts. Then, they can draw up a binding agreement that protects your tech start-up.
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For Employment Agreements
Staffing a tech start-up is a big issue. Tech start-ups now draw up employment contracts. However, resorting to self-help here can be destructive. This is because once signed; an employment agreement is difficult to amend. Furthermore, different classes of employees require various contract types.
For instance, an independent contractor and a full employee can’t sign the same contract. You’ll also have different legal responsibilities towards both workers. If you miss it at this point, it can hurt your company. So, it’ll be best to let a lawyer draft a standard contract for your staff.
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To Protect Intellectual Property
Tech start-ups thrive on intellectual property (IP). IP includes the rights to ideas, innovations, trademarks, and patents. Therefore, you need a lawyer to determine who will own specific intellectual property rights in the company. For instance, who owns lines of code could become an issue.
Many tech start-ups would prefer that the IP rights remain in the company and not individuals. However, only a lawyer is best equipped to make this possible. Furthermore, an excellent attorney can also devise means through which you can make money off your company’s intellectual property.
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Funding
Finally, raising funds is usually a challenging point for many tech start-ups. There are many fund-sourcing options for tech start-ups. For instance, you could use equity financing. Furthermore, you can raise money by selling shares or approaching venture capitalists. Bank loans are also feasible. However, not all these financing options are favorable for all business types. So, you’ll need an attorney who understands your business to make the right choice.
Connecticut’s Best Tech Attorneys Can Handle the Legal Aspect of Your Business
Are you an aspiring tech CEO in Connecticut? Have you already started your tech company? If you fall into any of these classes, you need the best Connecticut business lawyers on your side. Navigating the tech ecosystem and having to deal with the legal aspects of your actions can be challenging.
That’s why it would be best to rely on Aeton Law Partners. Our team of lawyers has extensive experience advising and representing Connecticut’s tech businesses. Furthermore, we understand the legal and regulatory aspects of the tech space. So contact us today for more information on how we can help you.