Choosing a Business Structure
Startup founders in the US have several options for legal business formation. The most common structures include Limited Liability Company (LLC), C-Corporation and S-Corporation. Each has distinct features regarding taxation, management and investment attraction. LLC offers management flexibility and pass-through taxation, while C-Corp is the preferred form for startups planning to attract venture capital.
Intellectual Property
Intellectual property protection forms the foundation of most tech startups. Key aspects include:
- Patenting technologies and inventions
- Trademark registration
- Copyright protection for software
- Drafting rights transfer agreements between founders
Regulatory Compliance
Depending on the startup's industry, various regulations may apply:
- For fintech projects - licensing and compliance with SEC, FINRA
- In healthcare - HIPAA and FDA compliance
- For user content platforms - DMCA compliance
- In AI - emerging regulatory initiatives
Funding and Investments
Raising investments requires thorough legal preparation:
- Drafting investor agreements (SAFE, Convertible Notes)
- Preparing documents for funding rounds
- Crowdfunding compliance
- Currency regulations for international transactions
Tax Obligations
The US tax system includes:
- Federal income taxes
- State taxes (and sometimes city taxes)
- Taxation of international operations
- Tax incentives for startups
Employment Matters
Special attention should be paid to:
- Worker classification (employees vs contractors)
- Visas for foreign specialists
- Non-disclosure and non-compete agreements
- Employee stock option programs
Corporate Governance
Effective management structure includes:
- Role distribution among founders
- Forming a board of directors
- Documenting key decisions
- Conflict resolution mechanisms
International Aspects
For startups with global ambitions, it's important to consider:
- Export controls
- Data protection laws (GDPR for EU)
- Operating in foreign markets
- International tax planning
Timely attention to these legal aspects allows startup founders to build a solid foundation for business growth and avoid costly mistakes in early stages.