The founders of a new corporation must address the crucial issue of structuring the capitalization of the corporation. After determining the amount of money the corporation will need for fixed assets, materials and operating expenses, the founders must then decide whether to finance the corporation with debt or equity, the proportion of debt and equity, and the rights, preferences, privileges and restrictions of the stock. This Newsletter shall discuss the advantages and disadvantages of debtRead More…

That is the question most frequently pondered in the area of dispute resolution. Litigation is an imperfect process at best. Winners are often left with pyrrhic victories; losers sometimes lose that which they have struggled to achieve over the course of a lifetime. This Newsletter explores the considerations that are taken into account when deciding whether to litigate; in future Newsletters we will explore alternatives to litigation and preventive measures by which disputes can beRead More…

One of the first decisions to make when starting a new business is the selection of a business entity. This Newsletter will discuss the advantages of the conducting business as a corporation. 1. Limitation of Liability. A corporation which is validly formed, adequately capitalized, and which complies with necessary corporate formalities, protects the owner’s personal assets against business liabilities. This is particularly important if the nature of the business results in potential liabilities which cannotRead More…

Finding money for your business, once you are in business, is a very different process than funding a startup. You already have an ongoing concern and a track record to show your potential sources of capital. And, there is a process that works. Our interpretation of that process:

Most businesses have one or two key individuals who create the environment for success. In a smaller business, the loss of the owner can be a fatal blow. Planning for business succession includes the following options:

The recent fires and earthquakes in Southern California have caused many businesses to review their insurance coverage. Failure to carry adequate insurance, or carrying inadequate insurance, can result in an unanticipated loss, or even business failure. This Newsletter shall discuss the types of insurance carried by most businesses.

EVALUATE POTENTIAL FUNDING SOURCES Funds for establishing and expanding your business may be derived from various sources. These may include anyone from family and friends to a public offering. Focusing on the sources of funds best for your type of business and stage of development can be an arduous task. Targeting the right sources will be crucial to the success of your capital fundraising efforts.

Between the years 1400 and 1900 there were about a dozen inventions that changed the world. They include the printing press, steam power, the locomotive, the cotton gin, the internal combustion engine, the telegraph and telephone, and the automobile. Each of these inventions dramatically changed the way we do business. Just think, if you had been alive in 1945 and been able to predict everything from television to the microprocessor chip.

Capital has been plentiful for startup companies for the past three years. However, with changes in the international marketplace, particularly the recent collapse of the Far Eastern banking system, the availability of funds has been shrinking. With this in mind, companies looking to raise capital for their emerging, expanding, or in some cases, weakening businesses should take a long look at how their efforts are focused.