Four Key Legal Steps from US Perspective
As part of our Entrepreneurship degree in Reichman University we had the opportunity to hear one of Carolyn Hochstader’s Entrepreneurship lectures. Carolyn is the managing attorney of her self-owned boutique international practice focusing on businesses and bankruptcy law, and a seasoned lecturer at the Wharton School, teaching a course on the Legal Aspects of Entrepreneurship in the US.
The lecture covered the most important points in the legal aspects of Entrepreneurship using a 4-step process, with focus on US-based entrepreneurship: Securing a robust IP portfolio, choosing a state and entity form, dividing the pie, and hiring talent.
In this lecture we came to learn that Intellectual Property (IP) protection has become increasingly important in the last two centuries for entrepreneurs. By definition, IP refers to the “ownership of ideas” – unlike tangible assets to your business such as computers or offices, intellectual property is a collection of ideas and concepts. This includes trade secrets, trademarks, patents and copyrights, and the process for acquirement and protection of each was explained to detail.
In the next step, “choosing your state and entity form”, Carolyn expanded on the relevant laws, strategies and tips for state registration and how choosing different entities affects tax and financing in the United States.
Thereafter, dividing the pie: understanding your capital structure and how to share the cake among founders, workers, advisors and investors – this step made us understand the key do’s and don’ts of financing your business, planning tax implications, and even how to target VC’s, how to bring the product to the market and how to assess strengths and weaknesses of a team.
The last step, hiring talent, taught us the main differences between independent contractors and employees, vital information regarding tax and wage penalties, labor law distinctions and unique tips and strategies for hiring.
Looking back, Carolyn provided us with the most fundamental and significant principles in the legal aspect of entrepreneurship. Although the lecture focused only on the United States, as entrepreneurship students we had not yet been exposed to different legal issues or strategies regarding start-ups and entrepreneurship. Carolyn’s vast experience in the business law space was extremely beneficial to our understanding of these key legal points and every single student’s question was answered in detail. On a personal note, I feel that our grasp of legal aspects is key to continuing our entrepreneurship studies and this was one of the most informative, imperative lectures we have received this semester.