For a new startup to find success in increasingly competitive markets, they need more than just the drive behind their entrepreneurial spirit. They also need the advantage of a legal strategy that protects their interests from launch to landing.
At Malone Law, we aim to advise entrepreneurs from the conception of their business idea through its entire lifecycle. The early days of a startup can be fraught with crucial red tape that may seem overwhelming when your priority is simply getting your product or ideas off the ground. Seeking out competent legal guidance from the onset enables you to focus your time and energy on your business while simultaneously ensuring your entity is structured correctly with room to grow.
Entity Formation Matters
The way you structure your new business should be based on a strategy that considers the present and facilitates the future. In particular, entity formation in the e-commerce, tech, SaaS, and digital marketing industries can be uniquely strategic. For example, tax liabilities vary depending on whether you decide to form an LLC or to incorporate. That said, some tax protection strategies won't come into play until income from your business reaches certain benchmarks. If you are at the point where incorporation makes the most sense, you'll need to understand what type of corporation to form and the necessary legal agreements required for each.
Corporations are more difficult to form and are additionally pricier to maintain. Regardless, there is the benefit of having defined corporate hierarchies wherein individuals have clear roles in the corporate structure. In some cases, incorporating a tech startup will be ideal for those looking for angel investors or investments from venture capitalists—these investors are almost always more inclined to invest in an incorporated business.
If incorporating is not best for you at present, then structure options such as limited partnerships, limited liability partnerships, or limited liability companies are available to you as well. These business types are easier to form and maintain, but they each come with their pros and cons—for example, a limited partnership doesn't provide the same personal liability shield you will have under the other two. These examples aren't exhaustive, and we can help you determine what type of business best suits your business goals.
Ongoing Virtual General Counsel
Maintaining your business continues long after you have formed your entity, and post-formation, Malone Law is here to help you with the next steps—because there are always a next steps. Partners, investors, and board members will come and go throughout your business lifecycle, and each time they do, it will require legal legwork. Corporate governance can be a difficult and time-consuming task that also necessitates amending articles of organization, bylaws, operating agreements, succession plans, shareholder agreements, and much more. At the state level, ongoing required filings must happen within the Secretary of State's time parameters for your business to remain in good standing. A business that fails to make the filings will be subject to penalties that could create collateral damage on top of the fees required in returning your company to a good standing status. Our job is to ensure you are fully aware of these procedural pitfalls.
In addition to corporate governance and entity maintenance, Malone Law will service the universe of your business's contractual needs. For example, as your business scales, we will advise you on and prepare equity agreements and arrangements, buy-sell agreements, partnership agreements, employment or independent contractor agreements, licensing agreements and customer agreements. The best way to ensure your business is entering into not only the appropriate contracts, but fully enforceable contracts, is by maintaining an open line of reliable communication with your business legal advisor.
Malone Law prioritizes consistent and timely communication with its clients because we don't operate under a call-when-there's-a-problem model. Running your business is nuanced, and consistent communication with your advisor will result in all parties being better able to anticipate needs and circumvent problems as your business grows.
Successfully running your corporation like a well-oiled machine often comes down to finding personalized legal guidance from a firm that is dedicated to proactive legal protection. That firm is Malone Law.
Malone Law provides ongoing virtual general counsel at clear and consistent rates to help you manage ongoing and legally imperative responsibilities throughout your business lifecycle.
TAX & ASSET PROTECTION PLANNING
Malone Law provides a holistic and integrated service uniquely designed to help business owners and real estate investors proactively tax plan, protect their assets and achieve generational wealth. Starting, implementing, and maintaining your business requires dedication from you and those guiding you. Malone Law believes that successful tax and asset protection planning strategies involve ongoing communication with various professionals. We pride ourselves on building a relationship with you and serving as your communication hub to prepare protective business plans and strategies.
Tax law is everchanging and requires a constantly evolving plan to ensure you are neither overpaying nor underpaying your business taxes. When you initially structure your business, we will help you do so with your tax obligations in mind. Rather than being merely reactive, we believe in high impact, forward thinking and proactive tax strategies. By leveraging the tax code, our mission is to optimize the profits of your business ventures by providing tax reduction and wealth transfer strategies.
When your position changes as your business grows, we will work with you to restructure your entity to protect your hard-earned wealth. Competent asset safeguarding approaches will help shield assets from the ongoing risks of running a business. Owning and operating a business is often layered with stress. That's not to say there isn't significant opportunity and reward along the way. Still, even when all is running smoothly, most high-earning business owners and real estate investors will lose sleep over what could be waiting around the next proverbial corner. Business owners operating in high risk and high reward environments should utilize every tool to mitigate business risks.
Malone Law offers more than just practical startup guidance. We also work to ensure that you are managing your ongoing business operations while continuously prioritizing tax, asset protection and other planning strategies to meet your unique goals. We are in it for the long-haul because you are too.
Business Entity Structuring & Succession Planning
The formation and organization of your business can offer a considerable amount of liability protection. Limited liability companies and corporations alike offer a certain amount of protection from claims against your personal assets. In these scenarios, it's important that you've maintained your personal assets and your business assets separately.
Business owners need to consider their succession plan long before they intend to step away from their businesses' roles. Maybe your goal has always been to sell your business, or perhaps you know you want to transfer your business to family in the distant future—either way, a succession plan will serve to ensure an effective change in ownership. In preparing your succession plan, you need to consider whether you would like to gradually step away while still maintaining some control over the operations or prefer to transfer ownership entirely at a definite point in time. You also need to account for unfortunate life events.
Other considerations for preparing an effective succession plan include preparing a roadmap for implementing the plan along with tax management strategies for the transfer. While succession planning is easy to put off, preparing now can help business owners avoid bitter litigation that jeopardizes the hard work they have put into building a successful venture.
Succession plans should be tailored to each business, and Malone Law understands the need for a uniquely designed succession strategy that suits your intended needs and evolves with your ongoing wishes.
Most business owners and real estate investors require more than the basic will or generic estate plan. Although common for individuals with relatively few assets, the actual administration of a Last Will & Testament can be contrary to your intentions and a burden to your heirs. If your assets are devised via your will, your heirs must endure the delay and associated expenses of probating the the will. Since this must be done through a Court proceeding, the docket is public record.
The trust is a widely popular tool for high net worth individuals who wish to avoid the probate process in distributing assets to their heirs after their passing. When these assets are held in trust, the trust agreement dictates how your ownership interests will pass. The transfer of ownership to your heirs is triggered upon your death, vesting them with real estate or other interests in accordance with your last wishes.
The trust can also be a powerful mechanism in Tax & Asset Protection Planning. A trust is a legal tool that allows a third party, known as a trustee, to hold legal title to business assets. Although transferring ownership of your assets to someone other than yourself may seem counterintuitive, it's important to understand that the trustee must act in accordance with the terms written out in the trust agreement. It's imperative that you speak with an experienced attorney when you create your trust because an ineffective trust agreement can lead to serious complications.
There are various trust types, and Malone Law can help you determine which trust is best for you and your assets. The type of trust that will work best for you depends on your current assets and your specific long-term goals. It is natural to experience hesitation when committing to long-term strategies in your business's startup phase, especially because you know your assets will change over time. Generally, trust agreements can be prepared to account for these changes or, if the changes are significant, the trust agreement can be amended. When you have an ongoing relationship with an advisor who knows the ins and outs of your operations, you will be advised of when the appropriate time to amend a trust may be.