

Legal costs of startup? - brianm

What are the unavoidable legal costs to get a typical web based startup off the ground and into a beta launch? Guy Kawasaki pointed out Truemors took just under 5k USD, is that typical?
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sgoraya
Depends - We had our lawyer draft the incorporation docs (c-corp) and
investment term sheets - We spent approximately $7,500 on the aforementioned
items

That said, we quickly spent close to $15k to include: Employment contracts
that included equity allocations, IP docs and contracts for two of our larger
clients (the bonus here is that we can reuse the contracts that have been
tailor made to protect us)

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Stubbs
In the UK it's worth contacting your local Chamber of Commerce to see if they
have a local BusinessLink. Sheffield Enterprise Network Trust Asc. have so far
paid all my legal fees for writing the T&C's & other documents.

They can also provide financial help in other areas too, merket research,
branding and general business guidence, all the stuff someone with a tech
background might struggle with.

There are limitations to what their funding will cover, and they don't require
any equity in return.

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NoBSWebDesign
I'm on my 3rd company (first web startup), and I've never spent more than
$1500 to start. If you're willing to get down and dirty with legal docs, you
can easily draft everything yourself (this of course takes great attention to
detail and enough confidence in your ability to rid yourself of the notion
that they're too difficult for common folk to write) and just get a lawyer to
review it.

Then, if you're equally willing to throw yourself into the code and server
setup, customer interaction, and the networking that goes along with starting
a business, again, it doesn't cost much.

I like LLC's personally because they're simple, protective, and structurally
transparent. Then again, I don't usually go out and seek investment funding. I
like to startup out of pocket, launch early the agile way, and then fund
development with revenue.

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corioliseffect
If you're spending more than $5k on a standard C-corp you're paying too much.
These docs are boilerplate at any reasonable firm. $15k is out of line.

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mightybyte
Is a C-corp what most web startups are using? Everything I have seen seems to
indicate that an LLC or S-corp are better to start with.

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jam
Starting as a C-corp from the beginning makes it much easier for you to take
investment. If you aren't planning on doing that, though, then an LLC or
S-corp are fine.

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chaostheory
according to a lawyer I talked to at DLA Piper it is

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SamanthaG
Hi - is your business based in the UK or in London?

