Business Start-up: Partnership Agreements
A key document in a business start-up is the partnership agreement. It defines the terms and roles of each partner involved. When entering a start-up partnership agreement, it’s essential for the wording of the document to be correct. James Braden, a San Francisco business attorney, could assist anyone in setting up their business partnership agreement.
The Importance of a Business Partnership Agreement
A business partnership agreement is a foundation for a new start-up made through a partnership.
No business should begin with an oral agreement between the partners. Having everything in writing will avoid a messy legal disagreement between the partners.
The wording of a partnership agreement clearly outlines how the business’s day-to-day operations will take place. The documentation will define the rights and responsibilities of each partner.
The absence of a partnership agreement could result in a costly legal battle that becomes a financial nightmare for all parties.
What Should a Startup Partnership Agreement Cover?
Every start-up business partnership needs some form of a written agreement. Remember, it’s a legally binding document that outlines the business operations and each partner’s ownership stake (financial and decision-making power) in the start-up. It’ll make every partner’s expectations and responsibilities clear to avoid any potential misunderstandings between all parties.
The written agreement should include the following:
- The immediate and long-term goals of the start-up business
- Which areas of the start-up business are the responsibility of each partner
- What titles in the management structure will each partner hold
- The distribution of the profits during the fiscal year
- Have a process in place if the partners agree to dissolve the business
It’ll help to gain some clarity and resolve all disputes about which partner holds the controlling rights in making all final business decisions. Think of the start-up partnership agreement as a guide to running the business’s day-to-day operations.
For instance, a proven marketing strategy is the focal point of your business. Before you launch the partnership, you should have secured protection for intellectual property in the business partnership agreement.
The wording of the clause should detail what intellectual property is eligible for protection. If written correctly, you’ll ensure that all your ideas and other marketing strategies are protected. A lawyer can enhance this agreement by acquiring copyright, patents, and trademark registrations that will protect every aspect of your business.
A San Francisco Business Attorney for Partnership Agreements
A business attorney will play a key role in a start-up business’s success. They provide valuable advice on numerous matters, such as potential business transactions.
A business attorney can foresee all potential legal issues that could affect the success of your start-up business. Their helpful insight will avoid a messy lawsuit by providing a solution that protects your start-up business and keeps all legal troubles at arm’s length away.
You want to select a business attorney who’s ultra-focused on protecting your brand’s reputation in the marketplace. They need to be detail-oriented, knowledgeable, and have excellent communication skills, especially in creating your partnership agreement. It’ll help to research potential lawsuit cases, draft contracts and negotiate labor agreements.
James Braden is a San Francisco business litigation attorney who offers various transactional services to businesses. Some of the services provided include the preparation of contract agreements, the sale and purchase of businesses, assistance with obtaining financing or funding for businesses, employee contract negotiations, and other business issues. Our team has experience transforming start-up businesses into becoming successful ones with the right legal preparations. Call us and set up an appointment today.