Many questions arise while forming a business – financials, taxes and the legalities can all seem a little daunting. Our office helps hundreds of entrepreneurs every year get established and off and running. A few nights ago, I was asked to be a speaker at a young entrepreneur event from TwinPortsConnex as a business law consultant. A fellow regional attorney and myself answered questions from folks in all the different stages of business ownership; from serial entrepreneurs to those just in the idea stage.
Q and A: Legal Tips for Entrepreneurs
Q: How should I go about choosing a name?
A: If you plan on having a website, check your domain name first. Test out your business name options on a few domain purchasing websites like JustHost Domain Typer to see if they are available. More often than not, it’s more difficult to get the domain name you want then it is to get it through registering through your state.
Q: How do I determine what type of business entity to file? How do I file?
A: Historically corporations have been the most popular type of business type. Today though, Limited Liability Companies are simple to set up, can cover almost any type of business venture, and with similar legal protection to a corporation. Read our descriptions for the different business entity types here. In Minnesota, you can file your business or nonprofit at the Minnesota Secretary of State office. There is a fee to file, and it is always a good idea to have an attorney look over your paperwork before you file. A lot of time and anguish can be saved by filing all of your necessary papers correctly the first time, than trying to change or undo them in the future.
Q: What would you say is a mistake that some entrepreneurs make in their first year?
A: Taking on too much debt. As tempting as it may be, avoid taking out extra credit lines and racking up the business credit card. Make a financial plan and stick to your budget.
