Originally posted on VentureBeat:
This is a guest post by startup lawyer Jennifer Berrent
When launching a startup, legal issues often get brushed aside in order for founders to focus on building the product. But making the wrong legal decision early on in the process of starting your company may lead to thorny problems in the future. Frequently, issues can be avoided by taking action in three key areas: choose the right entity, allocate equity and protect your intellectual property.
Choose the right entity
Once you are ready to move forward with an idea, you should formally form your startup as an entity. One important benefit of setting up an entity is that you can protect yourself from liability, since, in general, only the assets of the entity (rather than your personal assets) would be at risk. Depending on your business, either a C-corporation or a limited liability company (LLC) would likely make most sense. …
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