Choosing a common or trendy name for your startup opens your company to risk. You might like the name “Company XYZ,” and you might think you’re the “Company XYZ” of your field, but “Company XYZ” might disagree with you. If you are looking to choose a brand or product name, you need to think about trademarks earlier than you think.
Previously, we outlined the most common exit strategies for startups and why it is important to think about those strategies early. One of the most common exit strategies is mergers and acquisitions, or “M&A”. For a startup, this means the sale of all or a part of your company to another person or entity. Although M&A can refer to a sale of assets or equity of a company, we will primarily focus here on equity.
There are two types of M&A transactions which are distinctly different exit strategies: strategic and financial. A strategic M&A transaction would be the sale of your startup to another larger company that is a competitor, within the same industry, or that would enjoy some synergy with its current business by acquiring your company. Think of Amazon acquiring Whole Foods, Facebook acquiring Instagram and WhatsApp, or Google acquiring YouTube and Waze.
The influence of the Internet of Things (IoT) will undoubtedly be transformational with a total potential economic impact estimated to be $3.9 trillion to $11.1 trillion a year by 2025. In the race into the IoT marketplace, there are both known and unknown legal hurdles that will affect those who offer of goods and services during the proliferation of the Internet of Things.
Some of the current and potential legal hurdles related to the IoT are well known, some are not, and some are the result of the intersection between the physical and virtual worlds, and the collision between two intersecting major drivers of innovation in IoT. On one hand, there are the established manufacturers of products and consumer goods whose expertise in developing, testing and manufacturing products puts them in an advantageous position. On the other hand, there are the technology companies who are used to developing software and whose expertise lies in software development, data collection, and data processing. Continue Reading Hurdles the Internet of Things Must Clear for Manufacturers and Providers
We think it is relevant, even at this early stage at the commencement of 2018, so close to the 2017 holiday season, to note that the e-commerce explosion will continue in full force and will in the natural course of events bring transportation intermediaries more into the 3PL space in the delivery of fulfillment services. This is inevitable for those who intend to survive and grow. Larger multinationals are already substantially involved. However, it is especially important for small and mid-sized intermediaries to recognize that they must embrace digitalization in their industry even more so than they currently do in order to compete in this environment. The current view is that small and mid-sized intermediaries can survive and thrive in this new competitive zone. Continue Reading The E-Commerce Trend Continues in High Gear: How are Ocean/Air and Other Transportation Intermediaries Responding?
Husch Blackwell is proud to be a sponsor of Milwaukee Startup Week 2017. This series of events showcases the entrepreneurial spirit of Southeast Wisconsin and provides opportunities for startups to showcase their ideas, network with fellow innovators, and attend workshops with business, marketing, and legal experts. Husch Blackwell is sponsoring the Startup Showcase by Startup Milwaukee event on November 7, 2017. The showcase will provide local entrepreneurs the opportunity to present their products and services at the City Lights Brewing Company. Additionally, Husch Blackwell will have attorneys present on legal issues that affect startups during the Launch Conference on November 9, 2017, and other events throughout the week.
“What is your exit strategy?” This is one of the most common questions that startups or early stage companies are asked, but many entrepreneurs have not given their exit strategy much thought. An “exit strategy” does not refer so much to your departure from the company (although it might), but rather how an investor will make a return on his/her/its investment. Although it may seem counterintuitive, giving some thought to your exit strategy up front can help you determine how to structure and operate your company, and many investors will want to know your ideal exit strategy before they invest. Keep in mind that these various strategies are also not mutually exclusive, and your company may experience one or more of these through its lifetime. Continue Reading Exit Strategies for Startups
Last week startups, entrepreneurs, and investors gathered from all over the Midwest in Kansas City to attend TechWeek KC. It was a prime example of how startup culture (and success!) is not limited to the coasts. The best panel, in my opinion, addressed the unique challenges that come with trying to close a large institutional client as a B2B startup, as well as processes and hacks to overcome these particular hurdles. What follows are the high points from that panel, as well as from my own experience in a B2B startup before transitioning to legal practice.
Challenge #1: No one gets fired for keeping the status quo. If you’re pitching your product or process to big boys like Amazon, Coca-Cola, etc., then let’s all assume that you truly believe it’s something of value to them. It’s amazing how, while you can perfectly see that your piece of innovation is going to change the game for them, your initial point of entry to the (prospective) institutional client often doesn’t seem nearly as excited. What you’re not seeing is the calculus going on in their head: what’s MY risk versus MY reward if I were to pitch this to my superior? Unfortunately for you, and your contact’s company, most people fear failure. They’d often rather not try than fail and face any potential negative consequences, especially embarrassment among coworkers.
Football season is upon us again and, with it, the excitement, the thrill of moving the ball forward for a touchdown, and the agony of defeat. Ups and downs like this are what most start-ups experience. In football, it is important to protect the ball, to play good defense, and to avoid penalties. Similarly, start-ups need to protect their assets, defend their intellectual property, and avoid incurring unnecessary costs in the future. Following a few simple “rules” can help your start-up do all of these things.
RULE NO. 1: Stop the rushing game and avoid “illegal formation” penalties. Avoid quick-fix company formation tools you find on the internet. I know, start-ups hate paying lawyers. (This isn’t unique to start-ups.) You may like your lawyer, enjoy talking to her, appreciate the insights and ideas but, in the end, I know you’d rather not pay me for all of that (why can’t we just be friends, you ask). Why do smart clients nonetheless retain lawyers (like me) knowing full well we have to be paid? Because smart clients, like a good coach, recognize that starting a business is a process and that investment on the front end can lead to considerable savings on the back end.
It seems like we hear about a new data breach every week. Thanks to one of the most recent breaches, you could be only ten dollars away from getting in touch with your favorite A-list celebrity. Instagram — the Facebook-owned photo sharing company — was recently hacked due to a flaw in the program. Most recent reports indicate up to six million Instagram users’ email addresses and phone numbers may have been made public due to the data breach.
While the breach initially appeared to affect only celebrities and verified accounts, it has now been shown to affect a much wider range of accounts.
Imagine having a great product that is created and honed in your company for years potentially walk out of your office unrestricted. This same great product could end up in the headquarters of one of your competitors when there are no protections set in place. The fear of losing talent and ideas is a very real concern for all employers, including startups. Accordingly, there has been an increase in usage of non-compete agreements by employers in all sectors to combat the potential loss of valuable confidential information and trade secrets.