WHY HIRE A LAWYER?

INTRODUCTION

The enthusiasm of starting a business oftentimes cloud the founders from seeing the need to hire/consult a lawyer. There is a popular saying that ‘an ounce of prevention is worth a pound of cure’ but some entrepreneurs are easily starry-eyed optimist ignoring any foreboding waiting till something bad happens before they consult a lawyer. 

Legal guidance in setting up of a business is of great importance in ensuring the success of the business.

''I have never met a successful business person who never had a brilliant lawyer''.... Olufemi Awoyemi (Founder and Chairman of Proshare Nigeria Limited)

An entrepreneur needs to be legally guided in every facet of his business from; incorporation procedure, regulatory compliance, trademark and copyright protection, insurance, raising capital, obtaining patent.

3 REASONS WHY START-UPS NEED LAWYER

1.   Legal Structure for the Entity

2.   Safeguard Intellectual Property

3.   Drafting and reviewing contractual agreements

1.   Legal Structures for the Business Entity

Start -Up founders sometimes make the mistake of taking on many roles in the setting up of their business. They want to act as the lawyer, accountant, marketing analyst, sales rep. etc, neglecting the availability of professional advice. A lawyer is knowledgeable in the legal issues which pertains to the right legal structure to adopt for business.

The notion of saving money and time by not contracting professionals for advice can far outweigh the possible expense of going astray when selecting the business structure for your firm. The dynamism of law makes it of utmost important to consult a lawyer who is abreast with the latest regulations and requirements necessary for the choosing of the right business structure.   

 The choice of the best business structure depends on factors such as; liability, taxation and record-keeping. The form of business under the law to be chosen from are;

a.    Sole Proprietorship

b.   General Partnership

c.    Corporation

These business options have their advantages and disadvantages, its best the lawyer relates the pros and cons

                   2.Safeguard Your Intellectual Property

Start-Up founders make the mistake of relegating the idea of having a good IP strategy for their business but focus on other aspect of their business. They are oblivion to the fact that the most important aspect of the business is the Intellectual Property which must be safeguarded and avoid the risk of third-party intellectual property issues.

Safeguarding your IP will mean different things to different start-ups the common aspects are protection of your software, Industrial designs or brands, patents, copyrights, trademarks. The less common IP related rights include, database rights, trade secrets etc.

A lawyer understands the fact that having an IP strategy that aligns with the ideation of the startup business is very crucial and it aims at ensuring the new venture has a solid foundation for future growth, expansion and investment.

His role is to ensure he identifies and register your idea, designs, technology or artwork under respective copyrights, trademarks, and patents. This will prevent the unlawful use or reproduction of the idea you have under IP, and where it’s discovered that someone copying your idea, the lawyer would push for legal steps against the violator.

 

3.   Drafting and Reviewing Contractual Agreement

One of the greatest pitfalls of startup founders is the Bartimaeus attitude while entering contractual agreement at the initial stage of the business mostly due to the enthusiasm of starting a business oftentimes cloud the founders from seeking for a second view on the contractual agreement before executing same.

Having a lawyer either draft or review your contract before it is executed ensures that your business’s best interests are protected. He will draft in the favour of his client, coupled with his expertise knowledge in the industry, he can offer advice on typical contract terms that would benefit the business.

Having a lawyer helping with the drafting and reviewing of contractual agreement, would pay far more and prevent lose of valuable property, or exposure to unnecessary business and financial risks, including costly lawsuits.

While some startup founders cultivate the habit of drafting contractual agreement by self, risking leaving out key terms that are necessary to make the contract enforceable. A template agreement found on the internet may be outdated or may not consider the laws of your state or the specifics of your transaction.

 

CONCLUSION

We all can agree that it’s best to seek legal advice and have safety net before you need it. The aim of the article is to lay emphasis on the fact that start-up founders need not learn the hard way by falling into unobvious traps in the early stages of their startups. In the words of JAMES CAAN, he posited that;

‘’ Regardless of the nature of your business, industry or sector, when it    comes to establishing a startup, you will come across legal issues’’

The aforementioned reasons are inexhaustive as we have other reasons why you need to hire a lawyer as a start-up founder. It is worthy to note that just like a lawyer can help form the business, it can help develop policies and guidelines on how the business can come to an end.