At Citron & Deutsch we are a boutique Los Angeles based law firm who handles a wide variety of matters for companies and executives across several industries including newly formed startup companies. Our ability to understand each client’s situation gives us the opportunity to provide dynamic counsel and services in various circumstances, tailored to specific business needs. We act as general counsel for businesses in various industries. From conception to mature and established companies, we advise them on financial transactions, employment law issues, trademarks, manufacturing, distribution, mergers, acquisitions, and licensing. Our Start Up Attorneys in Los Angeles provide companies in any stage of development the legal resources they need. We believe that every company is different and we will work with you and your team to personally assist in creating the best plan for your company. We take pride in ensuring that we personalize each experience to best fit the needs of the company.
A Start-Up Legal Resource for Your Los Angeles Business
A startup is basically a company that is in the first stage of its operations. Startup companies often attempt to capitalize on developing a product or service for which they believe there is a demand for in today’s world.
Before starting work, every small business and startup company should create a business plan. Every business and startup company should have a plan, setting forth the goals of the management team and a direction for reaching those goals. There are numerous books, easily available at your local bookstore or online, which give the key elements to the business plan.
These elements include 1) General Summary, 2) Background for the Company, 3) Product(s), 4) Management and Personnel, 5) Markets and Marketing, 6) Manufacturing Process, 7) Financial Information, 8) Risk Factors and Rewards, and 9) Objectives, Timelines, Milestones and Benchmarks.
There are several purposes for developing the business plan. Most commonly, it is written in order to raise capital for a business. In this regard, it is important to keep in mind that the plan needs to be created and modified in such a way that considers who is going to read it. The same idea and business can be described in many different ways to cater to the distinct qualities prospective sources of capital (i.e., the private investor, banker or venture capitalist) are looking for.
Another purpose for the business plan is to provide direction for your management team and employees. Establishing goals is a key element to business success. Many businesses have an evolving business plan, in simple form, which is adjusted to the realities of the marketplace on a periodic basis, sometimes as often as monthly. The new movement towards Internet businesses almost requires this periodic updating because technology is moving so fast, and so is the competition.
If the business plan is intended as an internal document to provide management direction, it can be in outline form. However, if it is to be used to raise additional capital for your company, the plan should be reviewed and commented on by as many people as possible. Allow the red flags to be discovered by friends before taking the plan outside for fundraising.
The business plan can be reviewed but should not be written by a person outside the management team. The business plan should be an expression of the entrepreneur’s vision, not that of an outside writer. Sophisticated investors know the difference between a plan that has been written by a professional outside consultant, and one that is written by and pronounces the vision of the founders of the business. If your management team does not have the expertise to draft the plan, expand your management team to include those people who fill in the management gaps.
A business plan is a management tool, which you can use not only to direct the business and raise capital but also to attract management talent. Many investors go right to the resumes within a plan before reading the plan. They want to see a well-rounded and experienced team of full-time people, and complementary consultants and advisors. The better your management team and support personnel, the greater the chance for success. You can take a fabulous idea or product and mix it with an inexperienced management team, and create a formula which will have difficulty succeeding. On the other hand, with an experienced management team and an average product or idea, the chance of success is much higher. Solving problems takes experience, and people like to see that experience mixed in with the entrepreneurial founders of a company.
In summary, the stronger the business or start-up plan is, the stronger the management team, the more likely your funds will come in, and the more likely you will be able to obtain the valuation you want from your investment source and be able to control your company’s destiny. Being prepared and ensuring your plan is as accurate as can be allowed outside sources to easily learn and understand your plan and what future your company can bring. Call us today and speak to one of our transactional attorneys who can legally help create your newly formed startup company.