Get your lawyer up to speed before the first call

Questions worth asking

1. Given how we plan to raise money and exit, what kind of company should we be, and when?Qualified small business stock can shield $15 million or more of a founder’s gain from federal tax. Only C corporations can issue it, and for an LLC the 3–5 year holding period starts only when it converts.^4,5
2. What should move from a founder’s name into the company’s name, and how?
3. Is our name clear to use and register where we sell?
4. What personal information do we collect, and does our privacy notice match it?About 1,822 data-privacy class actions were filed in 2025, up from 1,488 in 2024.²

Records to have ready

• Trademark searches, filings or registrationsYour brand name is part of this.
• Records of who owns your domain and key accountsSome accounts or assets may not be in the company’s name.
• Your privacy policy and a list of services that handle customer dataYou collect personal information.

Questions worth asking

1. What should our terms with customers cover before the first one signs?
2. Does the company own what contractors and early contributors made?Under U.S. copyright law, a contractor owns the copyright in what they make unless it falls in one of nine narrow categories with a signed agreement, or they sign it over in writing.^10,11
3. What personal information do we collect, and does our privacy notice match it?About 1,822 data-privacy class actions were filed in 2025, up from 1,488 in 2024.²
4. Do our renewal and cancellation terms meet the rules where we sell?Within a few weeks in 2025, at least 12 class actions were filed against online retailers over renewal terms. The FTC and California prosecutors each reached $7.5 million settlements.³

Records to have ready

• The contract your customers sign todayIt shows how you sell now.
• Agreements with contractors and other contributorsPeople outside the company may have made work you rely on.
• Your privacy policy and a list of services that handle customer dataYou collect personal information.

Questions worth asking

1. What should we look for in the retailer’s or distributor’s terms before we sign?
2. Does the company own what contractors and early contributors made?Under U.S. copyright law, a contractor owns the copyright in what they make unless it falls in one of nine narrow categories with a signed agreement, or they sign it over in writing.^10,11
3. What should our agreement with the manufacturer or supplier cover?
4. Is our name clear to use and register where we sell?
5. Can we back up the claims we make about results, health, safety or performance?

Records to have ready

• Terms from retailers or distributorsYou sell, or plan to sell, through someone else.
• Your agreement with your manufacturer or supplierSomeone else makes or supplies your product.
• Trademark searches, filings or registrationsYour brand name is part of this.
• Anything showing contributors signed over their workIt’s unclear whether the company owns everything it uses.

Questions worth asking

1. Should the people doing the work be employees or contractors?In California, knowingly misclassifying a worker as an independent contractor can bring a civil penalty of $5,000 to $15,000 for each violation.⁶
2. What needs to be in place before our new hire starts, given where they’ll work?
3. Does the company own what contractors and early contributors made?Under U.S. copyright law, a contractor owns the copyright in what they make unless it falls in one of nine narrow categories with a signed agreement, or they sign it over in writing.^10,11

Records to have ready

• Any offer you’ve made or discussed, including pay and equityWhat you’ve already promised shapes the paperwork.
• Agreements with contractors and other contributorsPeople outside the company may have made work you rely on.
• Anything showing contributors signed over their workIt’s unclear whether the company owns everything it uses.

Questions worth asking

1. Which terms in the investor’s offer matter most for us?
2. What should we clean up in our ownership records and earlier SAFEs or notes before we close?
3. Given how we plan to raise money and exit, what kind of company should we be, and when?Qualified small business stock can shield $15 million or more of a founder’s gain from federal tax. Only C corporations can issue it, and for an LLC the 3–5 year holding period starts only when it converts.^4,5

Records to have ready

• Your cap table: who owns what share of the companyRaising money or selling starts from who owns what.
• Any SAFEs, notes, options or equity promised to anyoneEarlier promises affect what you can offer now.
• Your formation documents and founder stock agreementsThey show how the company was set up.
• Any draft agreement, term sheet or letter from the other sideSomeone else is on the other side of this deal.

Questions worth asking

1. Who will own what we build together, and what happens if the deal ends?
2. How do we protect what we keep secret when others need to see it?Under federal law, information counts as a trade secret only if its owner takes reasonable measures to keep it secret.⁷
3. Is our name clear to use and register where we sell?

Records to have ready

• Any draft agreement, term sheet or letter from the other sideSomeone else is on the other side of this deal.
• Trademark searches, filings or registrationsYour brand name is part of this.
• Licenses for software, content or data you useYou rely on someone else’s content, software or brand.

Questions worth asking

1. What should the founders put in writing about who owns what, and what happens if one leaves?If founder stock vests over time, an 83(b) tax election must be made within 30 days after the stock is received.⁸
2. What should move from a founder’s name into the company’s name, and how?

Records to have ready

• Your cap table: who owns what share of the companyA question between founders starts from who owns what today.
• Your formation documents and founder stock agreementsThey show what the founders agreed when the company was set up.
• Any SAFEs, notes, options or equity promised to anyoneEarlier promises affect what you can offer now.
• Records of who owns your domain and key accountsSome accounts or assets may not be in the company’s name.

Questions worth asking

1. What will a buyer ask to see, and what should we fix first?
2. What should move from a founder’s name into the company’s name, and how?
3. Does the company own what contractors and early contributors made?Under U.S. copyright law, a contractor owns the copyright in what they make unless it falls in one of nine narrow categories with a signed agreement, or they sign it over in writing.^10,11

Records to have ready

• Your cap table: who owns what share of the companyRaising money or selling starts from who owns what.
• Any SAFEs, notes, options or equity promised to anyoneEarlier promises affect what you can offer now.
• Your formation documents and founder stock agreementsThey show how the company was set up.
• Any draft agreement, term sheet or letter from the other sideSomeone else is on the other side of this deal.

Questions worth asking

1. What deadlines apply to this, and what are our options?If a company is sued in federal court, its answer is generally due 21 days after it’s served. State courts set their own deadlines.⁹
2. What should our agreement with the manufacturer or supplier cover?

Records to have ready

• Any letters, emails or papers about the dispute or complaint, with datesYou said there may be a dispute, claim or complaint.
• Your agreement with your manufacturer or supplierSomeone else makes or supplies your product.
• Contracts and policies you already haveYour lawyer will start from what you have.