Get incorporated and get busy

It is essential to realise that most businesses are legal and financial structures at the end of the day. Once the creativity and passion of the founders has taken a product or a service to the market, it is all about how you project your business. It is important to realise that you must formalize your entrepreneurial associations quickly and fairly early on, as it protects you legally and financially from potential problems in the future. Some mistakes that people make when they start out are

• Weigh everything in terms of trust and their past associations
• Neglect the legal and financial structuring of their association
• Make emotional assumptions about future prospects and revenue sharing
• Understate the importance of a severance / failure plan starting out

It is easy to plan for success, as it is a positive experience overall. Planning for failure and how it works is the most important thing for a start up with a product or service which is already working. If all the founders are clear about how they are positioned legally and financially within the organization, it provides a better environment for growth longer term.

The biggest reasons most companies are within families is because the above assumptions can be made safely when you know that there are social ways of policing the founders, but in most cases the only way to tackle a difficult situation within founders is legally. So, it is important that all entrepreneurs work with a CA and lawyer to work out how best their interests are protected in all their associations.

If you are someone who has seen the darker side, please feel free to write in to us. We are here to help all entrepreneurs get busy [and also incorporated if necessary]