Business Start-Ups

What is a registered agent?

You’ve taken the first steps towards starting your new business by selecting a business entity, but now you need to choose a registered agent for your business.  Naming a registered agent may seem like a formality, but it can have important implications for your business in the future.  As such, it is imperative that you understand the role of a registered agent and what you should know before choosing your agent.
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What are the advantages and disadvantages of a partnership?

Selecting a business structure is one of the most important decisions you can make for your new business.  Your business structure will impact your ability to grow and raise capital, designation of business duties, taxes, and much more.  For business owners with a partner, the most obvious choice for your new business may be a partnership.
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What steps should I take to open my own business in Texas?

So you have decided to open your own small business. Congratulations! You have taken an important step towards obtaining financial security and becoming your own boss, but there are several critical steps you must take to start your business off right.  Review our guide to opening your own small business in Texas and contact our Austin, Texas business startup and formation lawyer at the Kumar Law Firm PLLC when you are ready to get started.

What surprises might await you when you purchase property for your new business?

A news story that appeared recently thanks to an anonymous whistleblower in Lubbock, reminds us all that buying a local business can be trickier than it first appears. This is why, no matter how savvy you think you are, you should always hire a skilled, knowledgeable business attorney before purchasing a business.

Case of Uncommon Building Codes

In the case mentioned, a local business owner approached KLBK and EverythingLubbock.

Why is Austin attracting so many startups and entrepreneurs?

Austin continues to be a magnet for startups for  a variety of reasons. The region offers a favorable cost of doing business, a well educated labor force, a good lifestyle and good weather, all of which are attracting young people to the area. Combine these factors with no personal income taxes, and a low cost of living, and it makes for an environment well suited for entrepreneurs.

Growing Workforce

The educated workforce is due in part to the University of Texas at Austin and other area universities, that also attract foreign students. A educated, diverse population is beneficial to employers and a boon to business growth.

What is the state of the medical marijuana industry in Texas?

For some time it has been known that marijuana has many medicinal uses. Over the past couple of years there has been huge support for legalizing marijuana for medical use. Legislators finally listened and many states have passed laws that make it legal to use certain forms of the drug in these instances. So what are the business implications of legalizing pot? We can get a good idea by examining the happenings in our Southern most state.

One state that has recently passed a

What types of insurance do I need to protect my business?

In addition to choosing the right business organization, starting a small business requires obtaining the maximum protection for your company. By having the following types of insurance, your business will have maximum protection from a variety of situations that can lead to lawsuits.

Property Insurance

Obtaining property insurance should be a primary consideration for protecting your tangible investment, including essential merchandise, equipment, tools, and buildings. It is critical to protect your business property from the potential for loss and damage from a number of events, including fires, vandalism, theft and storms. In addition to protecting the actual building, furnishings, inventory and equipment, business property insurance may also cover other costs such as equipment breakdowns or the cost of clean up after a covered loss like a fire or storm.

Regardless of the size or type of business, it is critical to obtain general liability insurance. This type of insurance protects you in the event you are faced with a lawsuit arising from accidents, injuries or claims of negligence. General liability insurance coverage protects you if your products, services or employees cause property damage or bodily injury to a third party. For example, if someone is injured on the premises of your business and files a lawsuit against you, general liability insurance may help to recover some of the costs, depending on the situation.

Errors and omissions (E&O) is insurance that typically covers doctors, accountants and lawyers. For medical professionals, E&O usually comes in the form of malpractice insurance. At the same time, lawyers, accountants, architects and engineers are covered by professional liability insurance. Moreover, even businesses like advertising agencies and commercial printers, in fact any business that provides a service to a client for a fee, needs E&O coverage.  In short, E&O coverage protects you from error or omission on your part that has caused a financial loss for your client.

While the particular rules differ from state to state, employers are required to buy workers' compensation insurance. Generally, this type of insurance protects businesses from lawsuits arising from workplace accidents. Workers' compensation also covers medical bills and compensates lost income for employees injured on the job, whether on the premises or elsewhere, regardless of who was at fault. Workers' compensation also covers employees who are injured in auto accidents while on company business or who suffer work-related illnesses. It also provides death benefits to surviving spouses and defendants.

Small business owners should consider how they would manage if a fire or other disaster damaged their business premises so that they were temporarily unusable. If you are conducting business in an area that has a high risk of natural disasters, investing in business interruption insurance will compensate you for lost income if your company has to vacate the business premises due to disaster-related damage.

Every business is different, and each faces a variety of risks; however, by investing is the right types of business insurance, a company can protect itself from a wide range of losses and liabilities. 

“Authentic brands don't emerge from marketing cubicles or advertising agencies. They emanate from everything the company does...” (Howard Schultz, CEO Starbucks)

Whether you take coffee or not, most people are familiar with the Starbucks brand. Not every company is a renowned franchise like the international Barista. Branding , however, is essential for every small business. A brand helps customers identify a company's products and services and distinguish them from the competition.

Brands, Logos Trademarks

A company's brand stands for its reputation, and this is often a matter of customers' perceptions. Customers need to know who you are and a brand identity helps to clarify your target customers. Having an effective brand strategy allows a business to communicate with customers in a variety of ways.

Often, this starts with a logo or a trademark which serves as the basis for packaging, the domain name of a website, media communications, as well as advertising and promotional materials. Having a trademark, moreover, requires registering that mark with the US Patent and Trademark Office. This is a complicated process that requires the advice of an attorney in order to prevent a trademark infringement lawsuit that could possibly damage your brand.

 There are a number of steps a small business needs to take in order to develop its brand. The first is to define the brand and its purpose so that you capture the interest of customers. One way to do this is with a "mission statement" that explains what your business stands for and what your products and services do.

Once your mission is established, the next step is to identify your target market. Not every customer will be drawn to your product or service. However, there is a customer base that is likely to buy from your business, especially those that identify with your brand. In the end, your target customers will decide whether or not your brand has value.

Lastly your brand must have a personality and represent your values. The values of your brand are the core principles that foster relationships with your employees, customers and vendors. Ideally, these values should be the foundation for a positive business culture. Put simply, a brand is important to a company and its products and services much like someone's personal or professional reputation is to him or her. 

Your brand tells customers what to expect from your products and services and distinguishes you from the competition. Your brand strategy is essential for communicating and delivering your message which is really a promise to your customers. In other words, a brand flows from who you are, influences customers' perceptions and allows them to identify with you. Ultimately an effective brand strategy can give you an edge in the market place.

If you are considering starting a business or have already done so, an attorney can advise you on legal matters affecting your business.

One of the first question a business must ask itself is “how should we organize?” Of course, the answer to this question varies significantly based on context, however the legal organization of one’s enterprise should be of preeminent concern from the get-go – and here are a few reasons why:

            #1: Liability is Everywhere: It’s true – just ask any one of the thousands of business facing expensive, time-consuming litigation each year. From the food industry to technology, there is no private sector business that is immune to liability, which means the savvy entrepreneur must take steps from Day 1 to protect against its pitfalls.

            #2: Exposure May be Reduced: There are a number of positive action steps a start-up can take to help limit exposure to liability – and many are inexpensive, no-brainer type options that can make the difference between booming and bankruptcy. More on that in a minute.

            #3: It’s an Investment: For the start-up, expenses like legal fees and organization consultations may seem beyond the budget. However, the costs of litigation far exceed that of a short legal consultation and incorporation package – so think of it as the company’s first official investment in its future.

When it comes to incorporating in Texas there are several options to consider when forming a business, including:

• Private domestic corporation
• Close corporation
• Benefit corporation
• Foreign corporation
• Non-profit corporation
• Limited liability company
• Partnership
• Professional associations & corporations (e.g., law, medicine, architecture)

Of course, each option carries distinct benefits which may be best-suited to the particular endeavors of a start-up entity – and an experienced Texas business attorney can help officers choose the best way to incorporate from the outset, keeping in mind the factors listed above.

Is Texas a good place to start a business?

When we think of new business startups, our minds wander to places like New York City, Los Angeles and Silicon Valley. While these are great places for entrepreneurs to get started, are they any better than the state of Texas? Billionaire Mark Cuban doesn’t think so.

Cuban is a self-made billionaire who got started in the Lone Star State. Initially, he made his money by creating a streaming radio service, which was eventually bought by Yahoo! in 1999.  Now, he is a star of the hit TV show "Shark Tank." On this reality show, entrepreneurs have the opportunity to pitch their companies to wealthy investors who might financially back them if they like what they hear. Cuban has now invested in over 100 companies as a result of his spot on the show. 

Cuban was asked to speak at the North Texas Commission annual meeting. His topic was “how to think beyond the pitch.” During his presentation, he explained to the audience that he thinks Texas is one of the best states in which to start a company. While places like Silicon Valley are known for billion dollar buyouts, Texas is a great place to grow a business into an empire.  He also mentioned that he is trying to move some of the manufacturing he does in China back into the United States, specifically to Deep Ellum, Texas. Some of Cuban’s companies had booths at the meeting and were selling products or handing out samples and coupons to attendees.

According to Mark Cuban, if you are an entrepreneur in Texas, you can rest assured that you are in one of the best locations in the country. Nonetheless, nothing does more for your business than the representation of a knowledgeable and experienced business law attorney.

What are the benefits of incorporating my small business in Texas versus other states?

When starting a business, one of the first steps to consider is where to incorporate? Legally speaking, deciding where to incorporate is one of the most pivotal decisions an entrepreneur can make, as the company will be subject, as it grows, to the laws of not only the state(s) where it does business, but its state of incorporation as well. Accordingly, businesses should take into consideration the various tax, civil, procedural, and dispute resolution laws in place when making this decision – all of which will undoubtedly impact at some point during the life of the business.

In a recent survey conducted on thousands of small business owners in Texas, the Lone Star State ranked first as the friendliest small business state in the U.S. The survey reviewed several areas, including: ease of starting a business, state employment regulations, taxes, zoning, and environmental laws. Receiving an “A” in nearly every category, small business owners touted the relative ease with which a start-up in Texas can obtain the necessary licensing  as well as benefit from the overall unobtrusiveness of state environmental and zoning regulations. Small businesses also reported favorable tax treatment, including paying virtually no income taxes in most cases.

If you operate a start-up business and are considering incorporating in Texas, working with a reputable business attorney is one of the first steps to take to ensure a seamless transition. While the steps to incorporate and gain legal recognition of your business entity may seem straightforward, working through the state and federal hiring and employment regulations may not be as easy. An experienced Texas business attorney can help ensure that your enterprise meets applicable zoning and permit laws. This is especially important if your business is in the industrial or manufacturing sector.

If you are in need of assistance with your start-up business, please contact the Kumar Law Firm in Austin, Texas today: 512-323-6060.