Can you keep employees from competing?

Finding great employees for your team can be tough, and sometimes holding on to those employees can be just as hard. Losing quality employees to competing enterprises is a fact of life for many business owners, whether to an existing competitor or because an employee wants to strike out on their own. What can a business owner do to protect their company from an exiting employee stealing customers or encouraging Read More

Business Funding Alternatives: Pre-Selling

Pre-selling products and services is an increasingly popular way to raise much-needed startup capital. Early supporters can typically buy in advance and provide you with the funds necessary to cover your operating or development costs without requiring you to comply with complex securities regulations, conduct expensive and time-consuming legal filings, or seek out angel investors. The Benefits of Read More

4 Easy Ways to Identify an Accredited Investor for a 506(c) Offering

The accredited investor exemption provides a way for businesses and investment funds to raise capital without having to file a registration statement in accordance with U.S. securities laws. To be considered accredited, a potential investor must meet certain criteria for income amount or net worth. Prior to September 2013, an issuer could rely on a warranty or representation from an investor regarding the Read More

Does My LLC Need an Operating Agreement?

A limited liability company (LLC) operating agreement is a contract that accomplishes two primary purposes: Defining the structure and operation of the company Governing relations between the members When it comes to LLCs, an operating agreement serves as a blueprint for the way those operations will be carried out and important decisions will be made. Are LLC Operating Agreements Required in Read More

Entrepreneurs: Avoid These 5 Mistakes When Buying a Business

Buying a business can be the best decision you ever make as an entrepreneur. Certain missteps, however, can turn a dream venture into a nightmare investment. Listed below are 5 common mistakes people make when purchasing a business, many of which can be avoided by doing your homework beforehand. Mistake No. 1: Choosing the Wrong Business It is surprising how many entrepreneurs buy a business that’s completely Read More

The Honeymoon is Over: Understanding the The Importance of Partnership Agreements

When two or more people enter into a business partnership (typically done through an LLC or Corporation, but can be done through general or limited partnerships), their main focus is on growing the enterprise and turning it from a concept into a successful creation. During this honeymoon period, everyone tends to feel energized and positive. They don’t take the time to define what it is they actually should be doing, Read More

Flat Rates: Focusing on the Outcomes Not the Hours

Most law firms bill for their services using “billable hours.” In other words, the client pays for the time of lawyers to complete the project for them. This practice can be inefficient, not reflective of value conferred to the client, and susceptible to abuse. The billable hour was widely adopted by law firms in the 1960s. A lot has changed since then, including unbelievable technological advancements. For Read More

Blurred Lines: Understanding the Difference Between Employees and Contractors

The question of whether someone you hire to work is your employee or independent contractor can be a potential minefield if you aren’t somewhat familiar with these two different and distinct categories. The minefield that occurs when the lines between the two are blurred and misunderstood can be expensive, in both time and money. Colorado starts from the presumption that all people who work for someone else are Read More

A Brief Introduction to Drag-Along Rights

In its simplest form, a drag-along right is a provision that  entitles the majority shareholder to force the minority shareholder to sell his shares upon the same terms and conditions at which the majority shareholder is selling his stake. This right prevents the minority shareholder from refusing to sell his shares in case a buyer wants to buy all the shares of the company. When is this right Read More

The Advantages and Disadvantages of an Earn-Out Agreement for Sellers

As the owner and potential seller of a business, it’s only natural that you may value the company at a greater amount than a prospective buyer. So what can you do when you and a potential buyer are at odds over the fair purchase price of the business? One option is to utilize an "earn-out” agreement. An earn-out agreement is a mechanism in a transaction whereby a portion of the purchase price is contingent (and Read More