Legalities – in class situations we often talk about the Legalities as the ways we protect the interests of the Founder, any Funders and the Followers (our staff,  customers and the wider community).

The Founders interests are often protected by the the business being formed as a Limited liability company – this means that in the (hopefully unlikely) event that the business gets in to trouble that the Founders liability is restricted to the capital they invested in the business. Other issues may include protecting your Intellectual Property by Lodging Patents, Registering Designs and ensuring Copyright is protected.

The Funders may seek to protect their interests by having some form of guarantees on any loans and non-shares based investments in the company.

The Followers – Staff are usually protected by having conditions of employment and employment contracts.

The Followers – Customers are usually protected by having Terms & Conditions of Order or as consumers by Consumer legislation. The Business needs to ensure the conditions meet its needs too.

Task 1 – Start to gather a list of all the things you think may need to be clarified / protected legally.

Formalities – these are generally a similar set of issues, some need to be covered by contract others do not.

some of the most common formalities include:

• Registering your self as self employed with HMRC
• Registering the Business as a Limited Company with Companies House
• Setting up a Business Bank Account
• Protecting your Intellectual Property

You can find links to relevant resources in the Links section – explore the links in Start-up section and more.

Task 2 – Start to gather a list of all the things you think you dealt with as Formalities.

Practicalities – as you have gone through the process so far, your ideas will have evolved and as they do so, it is important to update your notes.

In this section you should be thinking about all the practical steps needed to make or do what ever your idea is based on and aside that to think how that will be done.

We described this earlier as the Business Model.

Task 3 – Start to gather a list of all the things you think you need to deal with Practically.

You might also want to do a further Sense Check on your working arrangements. We have worked with lots of pre-start-up business and early stage businesses and many fail to take account of little issues like:

• You will need a business base – somewhere to do your administration, somewhere to keep equipment, tools, supplies etc.
• You will need to communicate – you will very likely need a telephone, computer, e-mail account etc.
• You will need to pay suppliers and take money from customers – so you will need a Bank Account and some form of Financial Record Keeping – all appropriate to the nature and scale of your business.

Please make sure the issues already identified are being dealt with in tasks 1, 2 and 3 above and add any new issue to the relevant lists too.