Baby Start-Ups


Baby start-ups are those that have somewhere in the neighborhood of 3-8 people who are working on an idea. None of these people are usually employees, exactly, because as of yet the company isn't that organized. The most common baby start-up is a group of friends working on a project together, with the idea that the project will be worth some money when it's more developed. Baby start-ups generally don't have a lot of money, but they have an exciting idea and people who are enthusiastic about working on it. 

One thing we highly recommend for a baby start-up is a simple operating agreement, in which everyone who's on board agrees to some basics about the company. What share should everyone get, if there's ever any money? Usually it's equal shares, but it's good to get that on paper. How does someone quit? A group email is fine, probably, but just disappearing can make things complicated. Is anyone fronting their own money to buy basics? You probably want to write down whether and how that'll get paid back. 

We also strongly recommend some form of basic IP protection. This can be as simple as a Non-Disclosure Agreement (NDA) that everyone signs, or as complex as a long-term non-compete built into the structure of the company. Really the only thing you have as a baby start-up is an idea, and it's important to protect that. 

Both options are easy to do. Verbeck Law will have a quick and easy talk with the people involved in your start-up, and draft documents that are both easily understood and agreeable to everyone signing them. Getting these things on paper now can save you a ton of expense, angst, and time down the road, and hopefully we can help make sure that everyone is on the same page. We aim for our consults to be low-energy, non-confrontational, and appropriate to the business involved. You can wear a tie if you want to, but we're not going to.