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Hey - fortunately, your problems aren't actually too bad. Of course, you can take my advice with a 'boulder of salt' ;) 1. Afraid of patent trolls? Well, the
by flignats 15y ago
Hey - fortunately, your problems aren't actually too bad.
Of course, you can take my advice with a 'boulder of salt' ;)
1. Afraid of patent trolls? Well, there are a few ways to get rid of this fear. First, if your product isn't successful, no one will care if you are infringing - even patent trolls (unless you are a big company/name I am not aware of). Second, Let's say you do become successful and a patent troll sues you and is in the right - your product is successful, be happy about that. You'll most likely be able to come to an agreement to use the technology or be able to build your own tech around the patent at that point and stop using the patent's tech.
2. This is an easy one. When do you think you will be taking on investment? If your product is a success and you think your company will take on investment in the near term, then make it a C corp. Why? Because you have to be a C corp to take on a certain amount of investment and who can invest in you. I believe it is 1mm - but I could be wrong. Bottom line - most successful companies eventually have to become a C corp. But, let's say your timeline is for the long-term. You can become an S-corp and skirt some tax laws, favorably. An S-corp automatically turns into a C corp when taking on certain investment, growing to a certain size, or falling out of their definition of an S-corp. It's cool if you think you need the tax savings, but if not then why bother with the headache. LLC is the easiest to setup yourself. It gives you full control, good tax laws, and you can easily convert into a C-corp by merging it with one when you need to be labeled as such.
3. You incorporate your business. Your product will go under so many evolutions, changes, iterations, that you may not even recognize it 1 year from now.
Try to think of it this way; these are all technicalities at this point. Get these out of the way so that you are not putting effort towards these resource sucking details. Put your attention back into your product and focus on building something great!
- VuongN 15y agoThank you so much for your words. I will definitely keep them in mind as I continue my research. In term of your suggestion about incorporating the business, I assume that I need to trademark the product's name and taglines? Is that enough protection? Again, thank you so much for your advices--very helpful!
- flignats 15y agoNp - let me just say though that I am not a legal expert, I've only gone through the process before is all and can share my own advice. Trademarks are always a good idea if you have certain intellectual property that is unique to your service (logo, taglines, ect). Unfortunately, I cannot give you a specific suggestion for your situation. However, I would say that if you expect to take on outside investment in the near future then you can save yourself a lot of headache by just starting as a C corp. If you are going to build your company slowly, bootstrapped, growth all in-house - an LLC is probably your better option.