business law Archives
Connecticut startups need money in order to survive. In the old days, that meant securing funding from a venture capitalist, or VC, in exchange for a significant portion of the company's equity. However, many of today's entrepreneurs are looking at alternative ways to raise funds that are not as costly and restrictive as VC funding.
Some business owners in Connecticut may find that it's beneficial to acquire other companies. However, it is important to complete due diligence prior to making an acquisition official. One step in the due diligence process is to look for any liabilities that the target may have. Once an acquisition becomes the official, the acquiring company generally becomes responsible for some or all of those liabilities.
Venture capitalists are often among the first to be contacted when entrepreneurs in Connecticut and around the country are unable to secure startup financing from other sources, but a new way to get the money they need is rapidly gaining in popularity. Angel investors provide business advice and emotional support as well as much-needed cash, and they will generally be more forgiving and less likely to pursue legal claims when the commercial ventures they back fail to meet expectations.
For many entrepreneurs with tech start-ups in Connecticut, intellectual property may be critical to the future of their businesses. Proprietary details, methodologies for creating products and even internal practices of the company could all be considered trade secrets, particularly if this information is not available to the public. When people think of trade secrets, they may think of famous secret recipes; however, trade secrets have a significant amount of modern relevance for people involved in innovative startups and programming initiatives.
When Connecticut companies think about how to grow and maximize profits, one of the most common and advantageous ways may be through mergers and acquisitions. By buying other businesses, a company can expand its market and intellectual property in order to enhance its value and profit-making opportunities. When going through a merger, business owners or executives may have to think through and negotiate extensive changes in order to integrate another business in a successful manner. Bringing two companies together successfully can help to eliminate redundancy, and it can be important to avoid bureaucracy and work for full integration as quickly as possible.
There are several reasons why a startup in Connecticut or elsewhere won't get funding from a venture capital firm. For instance, there may have been problems with the pitch deck that scared a potential investor away. Issues could be related to how the deck was designed or the fact that there were egregious spelling or grammar issues. A venture capital firm may also have an issue with the company's valuation.
Connecticut residents who want to leave their current job to start their own business may want to plan ahead to make sure they take the right steps to getting to their new venture. Being properly prepared can play a significant part in being successful.
Business owners in Connecticut and throughout the country can be so focused on growing their companies that they forget to plan for their exit. Those who own family businesses may also need to start planning for when and how it will be passed down to the next generation. If there is no successor within the immediate family, it could be necessary to look into selling to an outside person or entity.
Business owners in Connecticut should take care how they handle mergers and acquisitions as the two business moves can impact how their brand is perceived. Combining two businesses can be a complicated process, significantly impacting brands. However, brands can be protected if they are managed carefully and strategically.
Running a business in Connecticut or anywhere else can be expensive. However, many business owners may only take into account the cost of paying workers or buying equipment. What they may not be thinking about is the cost of business liability insurance policies. While prices may vary for an individual business, the average yearly insurance cost is about $741. Those who don't have coverage may be financially exposed in a lawsuit or other claim.