Photo by Flickr (Ed Donahue)

With the start of a new year fresh in our minds, it is an opportune time to step back and not only set up your personal resolutions, but resolutions and goals for your business.

What business goals have you set for 2014?

Perhaps a good goal would be to incorporate one of the lessons that we have been discussing over the last few months. Focus on one of the “mistakes,” and take steps to make sure your business is on the right track.

An example could be taking the time to make sure all of your contracts are in writing or taking the time to finally sit down and draft an employee handbook that clearly sets up your expectations for the workplace. Another example would be making a point in your networking efforts to identify some individuals that would serve as positive mentors or additions to your professional support network. Or perhaps you could set up a resolution to focus on record keeping once a month — making sure all of your files are organized and your documentation complete.

Just like your personal resolutions can lead to a healthier and more balanced life, setting up business resolutions this year can lead to a healthier business!

This month, we’ll discuss the importance of documenting the rights of business partners. As a reminder, while these are general tips, it is important to consult with an attorney individually if you have specific questions or concerns. The following is not intended to be legal advice.

Mistake # 6 – Not Clearly Documenting Rights of Partners

Going into a new business venture with a trusted partner is an exciting and scary time. It is a time filled with endless creative brainstorming coupled with seemingly limitless opportunity. Your business partner could be a trusted friend and confidant or someone that came into your life more recently, but regardless of your personal relationship with a business partner, it is important to plan for the future at the beginning!

It may not seem important to take the time to plan now, but we as humans are prone to change, disagreements, and other unexpected circumstances popping up and ruining our best-laid plans!

Taking the time now to agree on how you and your partner will handle disagreements, a partner’s disability or death, a partner’s retirement, or how a partnership would be resolved is invaluable and avoids future conflict. The risk of not completing the appropriate planning now is that you and your partner may be unable to reach a consensus once an issue or problem arises since there will be personal, and likely conflicting, interests at stake.

Save yourself the headaches by documenting these rights when you and your partner are starting your business relationship and are clearly on the same page for the direction and expectations of your partnership.

Next Month: “Mistake #7 – Protect your Intellectual Property!”

 

About Leah Barteld Clague, Esq.

Leah Barteld Clague is an attorney with McLaughlin Law Group, a boutique law firm focused on corporate (small business), estate planning, and estate and trust administration, and tax law. McLaughlin Law Group, started by L. Content McLaughlin, serves clients throughout Maryland. Leah started with the firm in August 2012 after graduating from the University of Maryland, School of Law. Prior to law school, Leah completed her MBA and worked as a financial analyst in both the private and public sector.

In addition to estate planning, Leah has a passion for working with small businesses. As a student, she helped grow a program called “The York Business Academy” that provided brief classes on marketing, management, financing, and legal issues for small businesses and aspiring entrepreneurs. More recently, she consulted for a number of for-profit and non-profit clients and developed business plans, financial models, and marketing strategies that were presented to venture capitalists.  

Feel free to contact Leah at leah@mclaughlinfirm.com or 410-660-2095.