- Hi, everyone.
I'm Attorney Aiden Durham with 180 Law Co in Colorado,
and you are watching All Up In Yo' Business.
(bright lively music)
On this episode of All Up In Yo' Business,
we're gonna go through some of the important steps involved,
legal steps involved, in starting a business
and the things that you should be doing,
or at least thinking about,
to make sure your business is legally protected
and set up for success from the beginning.
But first, don't forget to like, subscribe, and share,
and check the description
for links to additional information.
I've got a new business checklist
that you can download for free.
The link is down there in the description
for all of you to enjoy.
If you want some additional tips
on the steps involved in starting a business.
All right, so a lot of stuff, of course,
goes into starting a business.
If you're a brand new business owner, or entrepreneur,
or aspiring business owner, there's a lot involved.
I'm gonna focus on the legal things involved,
the legal aspects of starting a business,
and not so much some of the administrative
or more business planning kind of things.
I'm talking just the legal stuff.
And so, when we're starting a business,
of course, one of the first things we need to do
is think of a name for our business.
Unless of course, you're gonna be just operating
as a sole proprietorship under your own personal legal name,
you're gonna want to think of some name for your business
or your brand.
If you've got a few name ideas in mind, jot all those down,
make a list of some of your top choices
of names for your business.
But before you go committing to one,
or registering a DBA, or an LLC,
or getting your logo drawn up, anything like that,
let's make sure this name is actually available
for us to use and potentially register as a trademark,
if that's something you're interested in.
But more importantly,
let's make sure this name is actually available
so that we can get the social media handles,
we can get the domain name,
we can show up on search results, and more importantly,
make sure we don't get into legal hot water later on
if somebody else turns out to already be using
the name that we decided to use.
So we'll want to do some searching.
Go to Google or your favorite search engine,
type in the name that you're thinking about using
and see what comes up.
If another business pops up
and that business is really similar
to what you're gonna be doing,
then maybe that name's not available.
Search Instagram, Twitter, social media,
see if there are other accounts
already using a handle with your business name.
And then of course, searching the USPTO
or the United States Patent and Trademark Office
is gonna let us know if someone
has already registered a trademark for this name
or if there's a pending application for the name.
We want to cover all of our bases.
The best way to do this
if you've got some money to put into it,
is of course, to hire an attorney
to help you perform a clearance search.
Most attorneys, most good trademark attorneys,
they'll search for registered uses and non-registered uses.
So like common law use across the Internet
and on social media, and state-level registrations as well.
If you can't afford to work with an attorney,
there are websites, there are services online
that will do a trademark clearance search for you
and give you a full report of everything they find.
These can be helpful,
but I've found that if you're not a lawyer,
if you're not familiar with what you need to be looking at,
some of these reports
that you can get from these search websites
might be overwhelming,
it might be more information than you really need
to determine if that name's available for you to use.
But at a bare minimum, do a Google search,
go on the USPTO's website and use their T-E-S-S,
their test system to do a search for the business name
or names that you're thinking of and see what else comes up.
Make sure it's available for you
before you commit to any name for your business.
Once you have decided on a name and you're pretty confident
that it's available for you to use, a good idea,
of course it's not required, but it's a really good idea.
If you're thinking about getting that trademark registered,
file the application now on an intent-to-use basis.
If you file a trademark application
on a 1(b) intent-to-use basis,
that kind of starts the application process
and that registration process
before your business is even launched.
You will need to have launched your business,
actually be doing business,
selling your product or selling your services
before the trademark will be registered,
but you can get a headstart on that process
and get that ball rolling beforehand
by filing on a 1(b) intent-to-use basis with the USPTO.
If you're not sure of how to do that,
if you can't afford to work with a trademark attorney,
check out my online course called BRANDISH,
where I teach you step-by-step
how to conduct a clearance search on your own
and how to prepare for and file that trademark application
with the USPTO.
And I covered the 1(b) filing basis
if we're doing an on an intent-to-use
and the steps involved with that.
So you can check the description
to learn more about BRANDISH
and how to file a trademark application
on your own without a lawyer.
All right, so we've got our name picked out,
we've perhaps started the trademark registration process,
where do we go from here?
We want to register the name with the state.
Whether we're gonna be operating as an LLC
or just as a sole proprietorship
using a DBA or a trade name,
either way, that's gonna need to be registered
with the state where you want your business to be formed,
or located, or registered.
In most cases, it's gonna make the most sense to register,
if we're doing an LLC, registering an LLC,
in the state where you live
or where you plan to operate your business.
Or again, if we're not going the LLC route,
we're just operating as a sole proprietorship,
most states require that if you're not doing business
under your legal name,
that you have to register a DBA or a trade name
for whatever that name is going to be.
Typically, if we're gonna form an LLC,
we'll be filing articles of organization
with the Secretary of State.
The terminology kind of varies from state to state.
Sometimes it's called a certificate of formation
or some other document title,
but in most states
it's gonna be called the articles of organization.
And that's what we'll file to form the LLC
and get the entity actually formed and in existence.
So now we've got our name picked out, we've registered it
either as an LLC, or a trade name, or DBA
with the Secretary of Sate,
next thing we're gonna want to do for many of us,
not everybody, is apply for an EIN
or employer identification number or tax ID number
with the IRS.
Now, an EIN isn't required for single member LLCs
or for sole proprietorships, unless you have employees.
If you plan on hiring employees
once you start your business,
then you're gonna need that EIN either way.
But as a single member LLC,
it's not required by federal law,
the IRS doesn't require it,
but a little foreshadowing for the next step, by the way,
we're gonna need it to open a business bank account
for the LLC.
Most banks require, if you wanna open an account for an LLC,
the LLC needs its own EIN or tax ID number.
Sole proprietorship,
banks really aren't typically going to require it
because it's still you individually doing business
and opening that business account.
But there's nothing that's preventing you
from getting an EIN as a sole proprietorship.
So you can always do it anyway.
And we do this by applying with the IRS.
You can go to irs.gov and use their online EIN application,
or there's a paper form that you can mail in or fax in
to get that EIN for your business.
And then, surprise, surprise,
once we've got the EIN ready,
we can go open a business bank account.
Now, this is super important if you're operating an LLC,
because we need to keep the LLC's assets, the money,
separate from our own personal money.
We don't want to be depositing money from the business
into our own personal checking account.
That is a big time no-no if you're operating as an LLC,
especially a single-member LLC.
If we're operating as a sole proprietorship,
then it's not quite as important.
Again, sole proprietorship, we're doing it personally,
it's us doing business anyway, there's no separate LLC.
So a bank account dedicated for your business
isn't quite as legally important,
but it's still a good idea.
Just to keep things separate makes it easier for bookkeeping
and accounting purposes.
It's still a good idea to just have a dedicated bank account
for your business's incomings and outgoings.
I am a big fan of Novo
when it comes to business bank accounts.
Novo is a completely online bank
and you can open a bank account online,
again, really easily, whether you have an EIN
or if you're just using your social security number.
The customer service is very helpful,
and best of all, it's completely free.
There's no monthly fees, there's no fee to open an account,
there's no fee to do ACH or wire payments,
it's all totally free.
So you can check the link in the description
if you want to learn more about opening an account
with Novo as well.
Now we want to take care of some of those legal formalities
if we're operating as an LLC.
This isn't gonna apply
if you're operating as a sole proprietorship,
but I imagine most of us are single member LLCs,
so we're gonna be going that route.
And so what's involved in that
is having your operating agreement prepared for your LLC.
This is super important
in order to keep that limited liability protection
that we get from the LLC.
We wanna follow these corporate formalities,
like having an operating agreement.
Sometimes we'll have an organizational resolution
or organizational meeting minutes.
Most of these things aren't required by your state.
Some states do require it,
but the majority of states don't require it.
But we know from case history, legal precedent,
things that we've seen in the past,
we know that it's still a good idea
to have an operating agreement even if it's not required.
Next, we want to think about any licenses or permits
that we might need.
So, there might be some professional licensing
that might apply to your business
depending on what kind of business you're gonna be doing.
If you're a lawyer, you'll need to be licensed
wherever you're gonna be practicing law.
If you are an aesthetician,
you might need a license from your state.
If you're in construction, there might be licenses,
any kind of profession related
or profession-specific licenses that might apply to you,
of course, make sure we've got those.
And then there might also be license or permit requirements
depending on where you're located.
Many cities and counties, some states,
might require a general business license
just to operate a business within that location.
So again, this is always gonna vary
depending on where you are,
but check with your state, and your city, and your county,
your local jurisdictions
to see if there are any home-based business requirements,
permit or license requirements, or any other kind
of business privilege license requirements,
anything like that,
and make sure you get those taken care of too.
All right, we are almost at the end
and ready to start doing business.
But before we do that, before we start working with clients,
before we start working with hiring employees,
before we start really doing anything,
we want to have contracts in place,
whatever kinds of contracts might apply.
This might be independent contractor agreements
if you're gonna be working with independent contractors.
If you're a service provider like a business coach,
or a health coach, or life coach,
having a coaching agreement,
of course, is going to be very important,
an agreement between you and your clients
that sets forth the terms of your relationship,
what you're gonna be doing for them,
what they should expect in the end,
what your expectations for your clients are,
having all of that in writing
is going to be huge in preventing issues, legal issues,
from coming up in the future.
If you've got a website for your business,
you wanna have a privacy policy and terms of use
or terms and conditions for your website.
If we're doing a membership program, a membership agreement,
some terms related to what your members can and cannot do
within your program.
If we're gonna be working with affiliates
and affiliate agreement,
any kinds of agreements
that might apply to you and your business,
we want to have those ready to go
before we start working with anybody
'cause we want to have all those terms in writing,
of course, before we start working with anybody.
And lastly, insurance.
Insurance is such an important thing
even if you're operating as an LLC,
especially if you're operating as a sole proprietorship.
But in either event, insurance is gonna be super helpful.
Depending on your industry, you might need
some kind of professional liability insurance.
If you're giving anybody some kind of advice
then professional liability is gonna be a good idea.
But for everybody, for most everybody's at least,
just a general liability policy is gonna help protect you
from legal issues that might arise from your business.
So make sure you talk to a good insurance broker
that you trust,
who can advise you on the proper types of policies
and coverage limits that you'll need for your business
and your specific situation,
'cause everybody is gonna be different.
And there you go, there you have it,
we are ready to start doing business,
and more importantly, start making money and depositing it
into our dedicated business account, you guys,
put it in a business account.
Even if you're not an LLC,
put it in a business bank account.
Can't say it enough.
That's all for this episode, folks.
Drop a comment below, let me know what you think.
And again, don't forget to check the description
for links to additional information and resources
like my free downloadable new business checklist,
or if you want more info on my online DIY Trademark course
to help you file a trademark application
by yourself without a lawyer.
Thank you all so much for watching.
I'm Aiden Durham, and I'll see you next time.
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